Internet Radio's "Last Stand" 316
We've been discussing the plight of Internet radio for some time, as the Copyright Royalty Board imposed royalties that industry observers predicted would prove lethal to the nascent industry. We discussed Web radio's day of silence in protest, which won the industry a reprieve, and the futile efforts to find relief in Congress. Now it's looking as if the last act is indeed close. Death Metal Maniac sends along this Washington Post story with extensive quotes from Pandora CEO Tim Westergren, who said: "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money... We're funded by venture capital. They're not going to chase a company whose business model has been broken." The article estimates that XM Satellite Radio will pay "about 1.6 cents per hour per listener when the new rates are fully adapted in 2010. By contrast, Web radio outlets will pay 2.91 cents per hour per listener." That's 70% of projected revenue for Pandora; smaller players estimate the hit at 100% to 300% of revenue.
What it comes down to is GREED! (Score:5, Insightful)
They also need an educational rate for colleges and schools and a non-commercial hobbiest rate for small 'bedroom' Internet stations
What are they thinking? (Score:4, Insightful)
By raising the rates, they're practically ensuring that they're not only pissing a lot of people off (almost everyone I know uses Pandora, for instance), but they're taking their revenue stream and choking it to death. Tons of net radio broadcasters are going to be forced to shut down over this, and I wouldn't be at all surprised if it means that, despite the increased royalty rates, they actually make far less in fees in the long run. And that goes doubly so for Pandora, which is one of the best ways I've seen for music fans to find new artists and new styles of music they may never have considered before. So much for that revenue-boosting avenue.
Silly Record Execs (Score:4, Insightful)
Royalty Pricing (Score:3, Insightful)
It's such a joke. we aren't going to have free radio anywhere anymore. Hardly anyone listens to XM or Sirus (hence the merger) and the radio already has so many ads that it takes more effort than its worth to constantly flip stations.
I was going to start using Pandora off my iPhone at work and on the way to work along with my normal playlists, but I'm afraid that web radio stations aren't going to make it after this price point.
I'm sure Pandora will stick it out since 30% of it's profit, will still be profit, but most places with limited ads on their sites will either have to increase their ads or ad revenue to stay afloat and knowing how little companies like to pay for advertising space this wont work out well for them.
I'm sorry everyone who listens to music for free, but doesn't download illegally, it looks like the music industry knows no bounds in how to FUCK PEOPLE OVER.
*sad face*
*middle finger* (D.C. beltway style)
it won't die (Score:2, Insightful)
No. Internet radio will not die. It will just move outside the more and more draconian USA.
Re:What it comes down to is GREED! (Score:5, Insightful)
Re:it won't die (Score:2, Insightful)
How many times can you shoot yourself in the foot (Score:5, Insightful)
I've been exposed to and promoted countless new bands that I never would have heard of on my own.
Re:Extreme capitalism stiffles faster innovation (Score:5, Insightful)
Re:What are they thinking? (Score:1, Insightful)
Is it really that complicated?
A recording label can only own so many artists. By limiting the total airtime available to promote artists they can improve the value of the big name artists. Sure, they lose money in terms of royalties, but they see themselves making a lot more on the other side of this equation. If all that most people can listen to is top 40, then people who own top 40 artists make a lot more money.
Exactly (Score:5, Insightful)
They'll claim that there will still be "radio" on the internet offered from regular radio stations. However, that is only a gimmick and advertising to promote another separate business (the original radio station), and means that an entire industry is being destroyed.
This move makes no sense other than to "test the waters" to see how far they can push business before they go bust.
Re:What are they thinking? (Score:1, Insightful)
Re:A small correction (Score:5, Insightful)
Re:Extreme capitalism stiffles faster innovation (Score:5, Insightful)
What we see in the US is not capitalism, it is corpratism, an unholy alliance between large corporations and the government. This is why you see laws created to make more profit for large companies, and bail outs from the government to large companies who lose a substation amount of capital due to bad business practices.
If we had real capitalism in this country, even capitalism with regulated markets (you know, laws to live by, like every other Individual has to follow) we would have a lot more innovation and new industries would rise up over night because they do not have to contend with being killed in the crib by a new law passed to favor established markets.
The Dark Side of the Greed. (Score:5, Insightful)
Ah, that's the Dark Side of greed.
The Light Side of greed sparks innovation because folks have an incentive to make money by creating something new.
The Dark Side always goes after the weak: the ones that can't innovate. It promises easy money, high barriers to entry with laws and regulations, keeping the status quo. Some greed masters like Masters Jobs and Wozniak break into a field of greed. They, being great greed masters, broke IBM along with another, though maligned greed master, Gates. But even then, The Dark Side can even ake the best of us as it did Master Gates. He seams to be coming back to the Light Side with his charity work.
Pay heed young greed patiwan, the Dark Side is always there for the lazy!
Re:The day the music died (Score:5, Insightful)
Now though... I work from home, I don't have a stereo with a radio in it. My only radio is internet radio. This is garbage. Ironically this will mean that RIAA and the like will be getting much less of my money. I'll be finding fewer bands whose music I like, buying fewer CDs as a result and they'll be getting no revenue from the Internet radio I listen to. I'm not sure what makes them think this is a good business choice.
Re:What are they thinking? (Score:5, Insightful)
If your mom-and-pop just plays the song once, there's no revenue to the record label from that. No great public interest is created in the song or the artist. The CRB and record labels are driving the current internet radio stations out of business to open the market up for major companies like ClearChannel to spring up their own crop of internet radio sites. Only since they'll be run by a corporate giant, they'll be more controlled and regulated to the labels' liking.
This is the only way (Score:5, Insightful)
There is a point when trying to fight the society with it's own rules is futile.
Think about what this sick society orders you: You have to believe in stupid jesus, you can't smoke pot, you can't have privacy, you can't listen to music, Save on your energy use so the big industries can have more oil for them, You can't say shit on tv, blah blah blah!!!
B U L L S H I T.
Screw them, most of what we do daily to maintain some level of freedom in our lives is illegal. If you really abide by all the rules, pay all the taxes, and stick to stupid society's moral rules, YOU ARE NOT ALIVE, you become a Zombie.
I'll sniff, drink, believe, take, download, copy, share, do, read, write, think, say, modify, film and build WHATEVER THE FUCK I WANT.
Re:Extreme capitalism stiffles faster innovation (Score:2, Insightful)
Ultimately, the responsibility lies with the consumer. We can blame the government all we want, but where the market is concerned, the buck does stop here. Literally. The real problem is that consumers have become lazy.
If you like Pandora... (Score:4, Insightful)
...then please consider paying the $3 a month to subscribe. Seriously.
I know the sentiment is that we don't want to pay for music unless it's in the form of a DRM-free, lossless file which we can give to all of our friends. We want it for $0.10 per track, and when the industry makes it available for $0.10 a track, we'll just say that we want it for $0.05 a track and go about our swashbuckling ways.
I fully understand that Pandora does not meet this requirement. It's just not their model. I just ask that you think of it it this way: does Pandora give you $3 worth of musical enjoyment a month?
Mainstream radio sucks. Supporting Pandora gives each of us a chance to be part of the solution, not the problem.
Re:Pirate Radio?? (Score:5, Insightful)
Re:Extreme capitalism stiffles faster innovation (Score:5, Insightful)
When laws are passed that drive a company out of business because it's no longer economical to consume their product (internet radio), that really is the government and not the consumer's fault. When a transaction is taxed for more than anyone is willing to pay for it, it stops happening legally.
Re:What it comes down to is GREED! (Score:5, Insightful)
The record companies don't want the revenue from internet radio, they want it gone. Internet radio allows easy discovery of music, something that the record industry has a pretty solid monopoly on currently. If they give up that monopoly, they risk becoming obsolete and actually having to work for their bread.
Re:Extreme capitalism stiffles faster innovation (Score:5, Insightful)
Sure, after a long time (50 years or so) the RIAA will be bankrupt and disband, but not before taking the US and any other "free" country to 1984.
Re:What it comes down to is GREED! (Score:2, Insightful)
is there any end in sight to this gross manipulation?
sadly, i think not. as an indpendent musician, this makes me sick. at the same time, there is still college radio and shows at which to whore out my musical wares.
Greed killed FM broadcast radio (Score:5, Insightful)
All the FM stations got bought out by Clearchannel and other conglomerates, and they all play the same songs broadcast from a central location. No more local DJs, no more local news, no more local weather, no more local music.
FM radio puts an emphasis on back catalog - rarely is there any new music that appeals to me. I do not care for hip hop, rap, etc. There is no variety in music, and there is a lot of music out there (esp independent labels) that is not getting played on FM radio.
Payola has pushed the independents out of FM radio. Nobody wants to admit that there is a white elephant in the room. Because the radio conglomerates have gotten greedy, the music variety suffers.
The obesity of advertising - way too much of it - has driven listeners away from FM radio. They are tired of the high ad-to-program ratio of program time. Radio conglomerates got too greedy when they consolidated all the FM stations and then tried to raise revenue through advertising.
The end result is a mass exodus of listeners away from FM radio. Many of my friends no longer listen to radio and they listen to songs on their ipods, their mp3 car radios, their internet radios, etc.
Independent labels found an outlet through internet radio and former FM radio listeners are embracing it enthusiastically. The FM radio lobby is extremely powerful and they conspired to use the royalty fees to drive the internet radio out of the market. That is not how capitalism is supposed to work.
Re:Pirate Radio?? (Score:5, Insightful)
However, I'm pretty sure U.S. laws still only apply to operations actually *in* the U.S., unfortunately, all of my favorite Internet radio stations are in the U.S. Despite that, there are many good stations out there that are not located in the U.S., worst case scenario I'll have to switch to one of them. (There's some good indie metal coming out of the Nordic countries these days anyway and I've always had a liking for some of the grungier J-rock)
I see no reason why "pirate" Internet Radio hasn't already sprung up all over the place. Find a host somewhere overseas who offers cheap bandwidth and set up a paypal account for your donations. It's easy enough to configure your sample rates and maximum allowed connections to keep under your hosts bandwidth cap. The only problem I can think of is finding a very cheap host who allows you to set up a Shoutcast/Icecast what-have-you server. I've oft been tempted to do just that myself, if only for my own use, but it strikes me as a way of going broke slowly. (Which is what i gather many of the existing Internet Radio stations are doing anyway.)
One last thought, I find it weird as hell that record labels have gone from paying DJ's to play the songs they felt needed promotion (Payola" [wikipedia.org]) to having to hit the DJ's over the head with a legal club to force them to pay for the privilege of promoting the band's material. They've cleverly but evilly managed to turn a marketing and promotion expense into another revenue stream, and it's one I have no doubt that the artists themselves don't get a piece of.
Re:Retarding progress of science and art again (Score:3, Insightful)
I would agree if you changed that to read "patents" instead of copyrights. Internet radio is a technology; the creation of the technology is already complete, and there are still players in that market who will work on incremental improvements because they're still turning a profit, even if that profit is not as big as they would like. What's being retarded right now is their ability to make a buck on other peoples' copyrights.
Further, you've provided no evidence whatsoever that even if copyright were to completely strangle Internet radio to death that it is still not a net gain. Nowhere in "promote the progress of science and useful arts" does it say it has to uniformly promote the progress of ALL technologies and useful arts. Agree with the concepts of copyright or not, the idea behind music copyright is to encourage creation of music, not to encourage the creation of radio. Radio is an offshoot business of music, and as it piggybacks on the rights of those content creators it is and should be subject to their terms. In a sense, their business model is not unlike the vilified RIAA's: They essentially provide some equipment to get somebody else's work out, and as technology marches on their equipment is less and less necessary in that task.
I sympathize with the position of Intenret radio companies in this case, but the group I'm truly angry at is terrestrial radio. Do you really think they didn't slip some money around to kill off their competition? What other reasonable explanation is there that their rates are lower than Internet radio's, per listener, while Internet radio clearly has a less lucrative revenue stream?
Revenue (Score:2, Insightful)
"That's 70% of projected revenue for Pandora"
Maybe thats high, but it seems less steep once you realize that 100% of their business is based on profiting off of other people's work. We often critique the record labels for being unable to find a business model that works, yet most of these Web 2.0 companies will fail once it comes time to actually pay the musicians for the work that draws the traffic to their websites in the first place.
Re:Pirate Radio?? (Score:5, Insightful)
... even if you play ONLY indie, free music, you are still subject to SoundExchanges fees.
That, above anything the recording industry has done-- aside from possibly the litigation/extortion campaign-- gets my goat. The nerve of those people, claiming to collect royalties for people who didn't ask for compensation of any sort. The fact that Congress let them collect and pocket indie music royalties, at rates decided by a few appointed-by-RIAA judges, is one of the best examples of how truly evil the recording industry is.
I have to ask those of you who are artists, lyricists, composers, and managers trying to scrape by under the cartel labels: Seriously, what makes you think that the execs who green-lighted the driftnet lawsuits, or the suits at SoundExchange with nothing better to do than sue people who play loud boomboxes in garages, give a rat's ass about how you're struggling to make a fair living? I'm betting that in order for you to get their full promotional and distributive services, you have to sign away the copyrights to your songs and become contractually obligated to make more at a factory's pace. Meanwhile, their lobbyists continue to tell Congress that a human's lifetime plus a half is still not enough to recoup the losses-- they want the copyright term to be longer and more indefinite. They're not going to let your work go where it can be seen or heard by everyone, they want to be the gatekeepers who dictate who gets to hear your works, when, and for how much. All they have to do to keep the prominent artists on their side is to entice them with lots of money and swag, and all they have to do to keep the lesser-known artists is to handcuff them with the contract, and/or feed them the RIAA propaganda that even a fleeting reference is a stolen song.
That a judge hasn't struck down the Bono amendment to the Copyright Act as unconstitutional, or the fact that SoundExchange essentially makes money off the backs of all musicians has not been challenged in the judiciary, is appalling on many levels.
Re:The day the music died (Score:5, Insightful)
I've found a ton of new bands that I love, and after discovering them, I've often purchased their music,
See, there's the problem. You finding new bands dilutes the revenue stream of the big players in the music industry. Web radio reduces the value of payola, distribution control and marketing. It reduces the artists dependency on crap contracts, and gives them a larger chance of succeeding on merits.
The very flexibility and customer use of web radio is what pits it against the industry interest; it allows people to build their own taste instead of having it built for them.
Play only royalty-free music, like DGF does (Score:3, Insightful)
The solution is simple, if draconian: stop playing music that isn't available royalty-free. And then either the royalty mafia notes the loss of the advertising force that comes from a wide listener base, and changes their grasping ways... or we all develop different tastes in music, and life goes on without royalty-impaired music.
In fact, here's a handy link to Digital Gunfire's royalty release form (used by permission):
http://www.digitalgunfire.com/radioplayrelease.rtf [digitalgunfire.com]
Re:Pirate Radio?? (Score:1, Insightful)
They came first for the Britney Spears fans, but I didn't speak up because I thought Britney Spears sucked...
(Apologies to Martin NiemÃller [wikipedia.org].)