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Music Media

Webcasters and Record Industry Both Appeal Royalty Ruling 190

Posted by michael from the play-it-by-ear dept.
jonesvery writes: "Both Webcasters and record companies are appealing the proposed royalty structure suggested by an arbitration panel, according to this LA Times story. It should surprise no one that the Webcasters feel that the proposed royalties are absurdly high, while the record companies wants them to be higher -- at levels set in independent deals negotiated between the RIAA and a couple of dozen companies. The fact that many of the companies that made these independent deals with the RIAA couldn't make enough money to both pay the royalties and stay in business doesn't seem to worry the record companies much. Funny, that..." We did an earlier story about the royalty ruling. The internet radio community seems to be just a bit upset about the whole thing.
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Webcasters and Record Industry Both Appeal Royalty Ruling More

Webcasters and Record Industry Both Appeal Royalty Ruling

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  • Good Info... (Score:3, Informative)

    by pirodude ( 54707 ) on Sunday March 10, 2002 @12:20AM (#3136762)
    DJ Ari from Digitally Imported has a lot of good information on what it means to the larger of the (still) free stations. They also have some information on what you can do to help them out.

    http://www.di.fm/sos.php [www.di.fm]

  • enforcement (Score:4, Interesting)

    by asv108 ( 141455 ) <asv@nOspam.ivoss.com> on Sunday March 10, 2002 @12:27AM (#3136780) Homepage Journal
    The fees under protest by both parties are:

    The fee is $1.40 per thousand listeners for Internet-only stations, and 70 cents per thousand listeners for over-the-air stations that simultaneously broadcast online.

    How would the record companies enforce such a payment structure? It seems to me that would be no method of counting the listeners that couldn't possibly be altered by the webcasters especially with all the different webcasting programs out there. Does anyone have a clue how the Record Companies were planning to accurately count listeners?

    • Re:enforcement (Score:4, Insightful)

      by dirk ( 87083 ) <dirk@one.net> on Sunday March 10, 2002 @12:35AM (#3136793) Homepage
      The fees under protest by both parties are:
      The fee is $1.40 per thousand listeners for Internet-only stations, and 70 cents per thousand listeners for over-the-air stations that simultaneously broadcast online.

      How would the record companies enforce such a payment structure? It seems to me that would be no method of counting the listeners that couldn't possibly be altered by the webcasters especially with all the different webcasting programs out there. Does anyone have a clue how the Record Companies were planning to accurately count listeners?

      FOr non-commercial stations, I don't know how they would accurately count it. For commercial stations, it would be easy, the station would do it for them. The station is going to keep an accurate count of listeners (or even an inflated count) because that is what they use to price and sell advertising time. So if they keep these stats already, that is what the recording industry will use to charge them.
      • using the statistics of demand for pricing has a parallel that should be obvious: as anyone who's run a website that's been slashdotted or had their website run up some high bandwidth bills can probably tell you, getting charged for being popular is NOT fun. The real problem is not that webcasters are in trouble, it's that the RIAA _wants_ them in trouble so that they can take over the webcasters' market.

    • Re:enforcement (Score:4, Interesting)

      by ShaunC ( 203807 ) on Sunday March 10, 2002 @12:39AM (#3136803)
      >Does anyone have a clue how the Record Companies were planning to accurately
      >count listeners?

      Probably by purchasing legislation which mandates that every personal computer in the free world can run only hardware and software designed/purchased/approved by the record cartels. With that amount of control, figuring out how many people are listening to which internet radio station doesn't seem such a daunting task...

      Shaun
      • the daunting task is creating such a foolproof system. There hasn't been an effective DRM solution on a mass scale like this before, and this one would have to be right the first time, and 100% secure. unpossible
    • How would the record companies enforce such a payment structure?

      A groundless estimate that is an order of magnitude skewed in their favor, of course.

    • Re:enforcement (Score:4, Interesting)

      by Trekologer ( 86619 ) <adb@@@trekologer...net> on Sunday March 10, 2002 @12:41AM (#3136806) Homepage
      The earlier story [slashdot.org] linked to this page [radiohorizon.com] which lists what the radio stations would have to report to the RIAA, under these proposed rules. The record companies aren't planning on counting listeners. They are hoping that the radio companies won't be able to jump through these hoops just for the opportunity to pay the royalties in the first place. The goal is to kill Internet radio on their path to put the digital music "toothpase" back into the tube.

    • Re:enforcement (Score:2, Interesting)

      by grapeape ( 137008 )
      Most web streaming applications tell you and log exactly how many streams are in use. I think its fairly obvious that what the RIAA wants is complete control over what is heard over the internet. If they can price the small independants out of business it means less competition for whatever deals they make with Clearchannel, Chancellor or any of the other major radio conglomerates.


      The internet community can take this as facing the inevitable or as a challenge. Id prefer the later. There are many listeners out there or this wouldnt be an issue. What if the independant small broadcasters all started gearing themselves towards only braodcasting non-riaa artists and original content?


      Ive been attempting to get a grass roots effort like his off the ground for years, unforntunately I dont have the talent to do the code needed myself, and I dont have the money to hire people to do it, but this is what Im looking for..


      1) Shared playlists between independent stations, basically play the same game the riaa does, if one station plays "Joes Garage Band" they arent likely to gain much following but if 20 stations do....this doesnt imply that all stations should have the same genres but those that do can share artists. The same goes for cross promoting of content.


      2) Produce original content, talk shows, live guests, game shows, radio drama, whatever will bring in people and get attention.


      3) A Centralized real time channel listing for all participating stations.


      4) An open sourced client and server that can be modified and customized via a plugin type method.


      There is alot more to it, but right now its just a pipe dream that I have had for many years. Ive had a business plan (yes there is a revenue model) finished for quite a while, but have had it dismissed by investors with comments like "its really cool but its star trek...just not possible" even though its totally researched and documented. Frankly I dont know where to take it. Im looking at source forge but am up for any suggestions.


      I really think the only hope for the future of streaming media is a united front but so far everyone I have talked to is looking for "cornering the market" or building their own conglomerate, is there any hope for folks that just want to share and communicate? I really think the best way to fight the RIAA is to not fight them at all but play the game the same way they do. The internet is still the greatest equalizer of all current forms of media. One person with determination and a good idea can create something that is just as competative and just as compelling as anything a big company with a wad of cash can do, and many people working together can do that 100 fold.

    • Practicality is of no concern to the RIAA. It isn't THEIR job to implement the technology, the tech people at other companies have to do that. Just look at the SSSCA - is hardware copyprotection easily implemented, if possible at all? No. Do the RIAA/MPAA etc. care? No.
      • Why does it have to be a technical solution? There is no technical mechanism for determining TV or Radio viewing/listening figures but the industry seems to manage. So could the same techniques not be used for measuring webcasting audiences?

  • Killing the Business (Score:4, Insightful)

    by pgrote ( 68235 ) on Sunday March 10, 2002 @12:35AM (#3136796) Homepage
    This quote from the article says it all, "The rates should be closer to the deals negotiated between the RIAA and more than two dozen companies, RIAA attorney Steve Marks said, even though many of those companies are no longer Webcasting or even in business."

    Did I miss something?

    Wouldn't you want to partner with those who are distributing your product to ensure your revenue is generated? If you price your product too high you cease to get ANY revenue at all. Period.

    What is going on? Why is the RIAA hellbent on staying in the 20th century? Seriously ... if anyone can answer that for me without being flippant, I'd love it.

    Have we ever seen any industry at any other time do the same thing?

    • Re:Killing the Business (Score:3, Insightful)

      by Anonymous Coward
      Buggy-whip manufacturers probably went through a similar period of bizarre behavior.

    • Re:Killing the Business (Score:4, Insightful)

      by gilroy ( 155262 ) on Sunday March 10, 2002 @12:44AM (#3136809) Homepage Journal
      Blockquoth the poster:

      What is going on? Why is the RIAA hellbent on staying in the 20th century? Seriously ... if anyone can answer that for me without being flippant, I'd love it.

      I would think that this is obvious: The RIAA wants unshared control of the music industry. Are they opposed to downloading songs? Not at all -- witness PressPlay and such. They are of course opposed to anyone else having a say in downloading songs.


      I imagine it's something similar here. They like Internet streaming but don't like the idea of small, free stations providing it. They can set the rates high enough to drive out every competitor. Don't be surprised in a year or two if you see RIAA-supported "Internet radio", wherein the major labels make sweatheart deals with one another to get around the exorbiant fees they'll charge every else.


      Once more, with feeling, from Cosmo of Sneakers:


      There's a war out there, old friend. A world war. And it's not about who's got the most bullets. It's about who controls the information. What we see and hear, how we work, what we think... it's all about the information!
    • They (RIAA) want to control it all. I seriously they doubt they give a rats ass about the chump change the internet generates in comparison to CD sales. It's quite obvious that most of the independant internet broadcasters (or really, more traditional radio broadcasters w/ internet casting as well) can't afford this price, and surprise surprise, the RIAA is using the legal system to squash an industry that they don't financially own.

      That, and guess what? The RIAA can use this to threaten legal action against anyone who broadcasts music online.

      So there's your answer. Manipulation of an already corrupted legal system to tighten their fist around everyone and everything. That's why they are doing this.

      • That just sucks. I didn't really even think about that considering that the industry attempts at even anything resembling what others have offered is putrid.

        Wouldn't that put them in a precarious legal position? Shut out the competition then open up your own shop? Wouldn't that invalidate their arguments?
        • Wouldn't that put them in a precarious legal position? Shut out the competition then open up your own shop? Wouldn't that invalidate their arguments?

          They won't open up their "own" shop - it ends up as a sister company - that way they still push the same legal agenda but there are all sorts of wonderful tax breaks for certain business setups.

          Of course, if they do manage to destroy Internet music, they could just partner with Napster and be the only option.

    • Wouldn't you want to partner with those who are distributing your product to ensure your revenue is generated? If you price your product too high you cease to get ANY revenue at all. Period.


      True, it wouldn't make much sense to price Webcasters out of business. As you point out, even a small amount of revenue is better than none at all...


      ...unless the major labels were planning on introducing their own webcasting plans. Then those other webcasters become not revenue, but competition.


      Admittedly this is just speculation at this point. However it does make a lot of sense, especially when one considers how the RIAA has gone after P2P programs. The RIAA wants to be in exclusive control over all music distributed over the Internet. In its eyes, a webcaster is little better than Napster since it is something that it cannot control, and thus not profit off of.


      I hope these guys win their lawsuit. I know I've been entertained listening to Shoutcasts that have played obscure stuff I've never heard on the radio before.

      • They *obviously* have their own webcasting plans. Think of the captive audience being channeled to their online music sales sites.. Or the little applet-- says what song is playing... A "Buy Now!" link...The music never stops..

        The nice thing for the RIAA is that the members already own 90% or so of popular music. RIAA members will be playing their own music so the costs for *their* streaming will be next to nothing b/c it will simply "net out" between them. The indy stations which promote a diverse set of indy music (I like to code to Somafm.com) from a diverse set of labels would not only have prohibitive fees, but prohibitive paperwork. Any fees will place the indy streamer at a competitive disadvantage.
    • What is going on? Why is the RIAA hellbent on staying in the 20th century?

      Because the 20th Century was history's best century for tyrants and liberty-crushers of every kind.

    • What is going on? Why is the RIAA hellbent on staying in the 20th century? Seriously ... if anyone can answer that for me without being flippant, I'd love it.

      Some observations:

      The RIAA does payola to get the manufacutred 'hit' music air.

      The RIAA doesn't give a damn about independent minded station, so long as they pay the royalties, to them of course

      The internet comes along and viola, listeners can actually select what they want to listen to, give immediate feedback to stations, and usurp control from the highly engineered controls the RIAA has spent decades putting in place, as the number of outlets mushrooms (remember for a moment how the Congress protected local TV stations in cable markets?)

      The RIAA resists, makes it painful to broadcast over internet, download music listeners actually want, in effect trying to maintain control

      Rather than find and develop talent, the RIAA, if not already, will probably develop computer generated 'hits', hire professional actors and dancers to just mouth the words and so on (it has actually been the case for decades that companies assemble writers, peformers and studio musicians for manufactured pop, now imagine it without the studio musicians and writers, just a fine tuned program)

      Technology being as advanced as it is, home users or small groups of interested parties can manufacture thier own music and distribute, even sell MP3's, bypassing RIAA altogether

      RIAA becomes less relevent if they lose control. As those who hold stake in such companies apply pressure to maintain profit and share value, the battle intensifies to maintain control, pushing legislation to cripple technology and make fair-use rights moot

      Pundits and forum posters lament the seeming idiocy of the RIAA in the face of a new fronteer

  • There are lots of good internet raido broadcasts and broadcasters. Im listinging to my favorite one right now and hes gonna have to take his stream off line soon because of these money grubbing bastard companys.

    This saddens me. the whole RIAA/MPAA/DMCA stuff just pisses me off. i think im gonna move to another country this is all such BS.
  • With webcasting you know EXACTLY how many listeners you have. With over-the-air radio, you do it by sampling. Why the hell should an exact plus over-the-air company pay twice as much as an only over-the-air network? Is the total audience of the over-the-air networks EXACTLY equal to the internet audience?!

    Basically just another way to screw more money out of a new media outlet. WABC (New York AM station) had to stop streaming because they just streamed their live feed to the 'net, but got sued out of it because they didn't pay MORE MONEY for their Internet ads!

    Do the advertisers for AM radio stations REALLY think that people on the Internet will pirate their ADs in digital format to spread them as MP3s!!!!!!

    Hell is approaching Earth at a scary speed.
  • Expressing my concerns, that the rates are meant to remove the pioneers "Small Business" in order to make room for Large Corporations. Here is how it works, you innovate, someone else sees it, and proceeds to force you out of business. I guess it is too hard these days to offer better services.
  • Does anybody else suspect that the RIAA has the impression people'll be able to keep the music they stream?

    I think they're worried ppl will use streaming broadcasts to thwart copy restricted CD's, so they're limiting that to only the companies willing to shell out $$$ to play them.

    I feel sorry for the people getting burned by this, but every time the RIAA makes another heavy handed attack on the internet, I feel like they're that much closer to being dissolved.

    • Easy way to prevent capture and redistribution of streamed music: Require DJ's to talk over the music, like they already do on radio stations. Problem solved.
      • I think you are fundamentally right, but the potential problem is that DJ's only work 8 hours a day. The internet removes all time zones, basically.

        There are ways around that particular issue, of course, but I just wanted to mention that it's not as simple as that.

        Maybe an automated thing? I dunno..

        In any case, unless the RIAA requires what you suggest (that'd draw MORE heat I bet...), then they won't find that an adequate solution.
    • They seem to be missing the point. Heck, even if you change the point, they seem to be always missing it.

      Streaming is verboten, because that might be something that they could charge for. However, noone will pay for it (a la, major league baseball internet-cast).

      But on the other hand, they won't support any form of open access to the media. So what do you think happens? piracy.

      That's not much of a surprise. I hate to see it as much as anyone else. I think it's a shame, but until RIAA actually offers an alternative that people can use, noone should be surprised that the chinese are cracking down on protesters.

      • No one paid for the major league baseball internet-cast? As a Mets fan out in California, I gladly paid my $10 for the entire season's (every team, every game) webcast. I'll have to see how much it is for the season this year before saying whether or not I'd do it again.

  • International broadcasts (Score:1)

    by Anonymous Coward
    Again... how do you apply this outside of the USA? Obviously the net suddenly doesn't stop at national boundaries (unless you're in China), so whilst the various parties keep arguing over royalties just listen to stuff from abroad, like the ogg stream of BBC Radio 1 [bbc.co.uk].

    It would be prudent for US broadcasters to place their servers outside of the USA, or do they determine royalties from source of origin?
    • In Australia the Australin Performing Rights Association (APRA) looks after some licencing (including collecting fees from business premises for the use of radio broadcasts) and at least one Australian based net-only radio station says it has arrangements for fees. Quantum Radio [quantum-radio.net]

      I presume that if the RIAA deal gets off the ground they will pressure local licencing authorities around the world to match the fee structure.

  • The RIAA is shooting themselves in the foot. (Score:4, Interesting)

    by PhantomHarlock ( 189617 ) on Sunday March 10, 2002 @01:01AM (#3136860)
    This will be the end of such wonderful music resources like Groove Salad and Digitally Imported. These two stations are largely responsible for me purchasing any CD's at all last year. I don't like any of the ultra-narrowband content being shoved down commercial radio, I don't listen to it. The only music I purchase comes from college radio and netcasts.

    Instead of allowing natural forces to broaden everyone's musical horizons, the RIAA is stifling it back to the 20th century model. If they keep being sucessful in court, the only way to fight them will be to turn music into a grass roots listener supported movement. This can only be done by enabling good musicians to run their own businesses to support themselves. This means being internet-savvy and moving away from standard CD-distribution. It means not signing the deal with the devil and trying to make it on your own with live performances and micropayment downloads.

    Sites that facilitate this could act much like record lables in the promotional aspect - they would serve only to group together musicians of common genre. Instead of taking most of the artists' revenues away, they can charge a low, flat listing fee for each artist per month, which in quantity could still be quite profitable for the wise entrepreneur.

    It comes down to the fact that 90% of everything is STILL crap, and only the top 10% of musicians will make any real money at it. But it will still be 100X more than what the current RIAA model allows. It will be the breadth of availability, not the quantity of each genre, which will improve.

    When art combines with money, it can be a bad thing if not done right. When it is done right, it's a pleasure to make a living doing what you love.

    --Mike

    • To confirm that music is purchased due to hearing it over Internet radio...

      Last month, I heard something that sounded really good on the Drone Zone [somafm.com], looked up and saw the artist was called Fila Brazillia, downloaded a couple of mp3s via peer-to-peer sharing services, decided I really liked them, and ordered 2 CDs. I'll be ordering the rest of their catalogue very soon.

    • I know exactly how you feel. Dicky's Rockin' Radio, a real rockin' punk/ska Shoutcast station, has been a revelation for me. I have discovered some really great bands by tuning into Dicky's and other excellent punk Shoutcast streams, and I have made many purchases based on what I have heard. I always kinda liked punk rock, but there is absolutely NO punk or ska on regular radio anymore, unless you count pseudo-punk crap like Blink 182. Before Shoutcast, I had virtually no way of discovering new punk bands. Every radio station in the Bay Area that used to play punk has become yet another giant advertisement for crap like Linkin Park and Limp Bizkit (how bands like that became popular I will never know). It's great to have a place to discover new bands from a genre I actually like. I just wish I could listen to Shoutcast in the car. I would be devistated if the RIAA took away my only way of hearing new punk rock.
    • Because they want the power. The internet will eventually bypass the labels entirely, with bands distributing their own music from their own web site. No middlemen whatsoever. There would still be studios, but little neighborhood ones would be fine, and no distribution networks, no scouts running around the country scoping out bands, etc. This is what the labels fear most. They want to impress people with how important they are, in inverse proportion to how important they actually are. The internet threatens to show that they are wearing no clothes, and that scares the pants off them (so to speak!)

  • A + B = C (Score:3, Funny)

    by fleener ( 140714 ) on Sunday March 10, 2002 @01:02AM (#3136861)
    A + B = C

    A. Net radio plays corporate music

    B. People buy corporate music heard on net radio

    C. Corporations make more money

    Oh wait, that's silly math. Here's how the real world works:

    W + Q = Z

    W. Corporations charge net radio to play music. Net radio disappears.

    Q. Corporations continue to rape musicians up-the-butt with a silver broomstick. Musicians walk kinda funny.

    Z. Corporations whine when profits plummet, so they pull politico puppet strings to make tens of millions of Americans criminals and continue to consume corporate welfare and pass more laws to prop up their failed business models.
    • Look, I'm sure your A+B=C formula applies in some cases, let's be more realistic about this-

      B. People hit Bearshare to download the song they heard, and liked, on net radio. No one makes any money.

      I have no doubts that some people, although certainly less than what is claimed, actually do run out and purchase CDs after hearing a song either on net radio or via any number of P2P set ups, but I'm willing to bet that a vast majority don't. I don't. None of my close friends do. In fact, I don't even know anyone at all who does. Is it dishonest? Yes. Do I care? Sadly, no - I have no excuses or utter bullshit "free use" rationales. It feels great to take money away from the RIAA and terrible to take it away from artists, a pathetic cut it may be. The bottom line is that I have all kinds of music that I would -

      a) not have bought anyway (one good song on the CD syndrome).
      b) not have been able to afford on a student's fixed income.

      And, honestly, I sleep just fine. Ask around - it is not an absurd claim to make that most of those who claim to purchase music based upon "samples" obtained from P2P services or net radio are lying or strongly exaggerating how often it happens.

      • The wins far outnumber the losses. Sure, there are people who do nothing but download and rip music CDs. The much greater audience is people who dowload and get exposed to new music and then go out and buy a CD containing that music. Why? Because most people have better things to do with their time than to spend it in front of a computer. You are not typical. The average person doesn't enjoy spending hours in front of a PC for the mere purpose of collecting songs.

        The price-point of CDs acts as a weeding mechanism so that people don't have a million CDs at home. They only have music they really really like. Naturally, paying for CDs also means exposure remains low - there is much music people would enjoy if they knew it existed. File sharing expanded peoples' horizons.

        It is the music industry that "doesn't get it." They are seriously inhibiting their profits by criminalizing tens of millions of Americans.

        Personal example: I spend 12+ hours in front of a computer each day (8 work, 4+ leisure). I recently had a need for TV show theme music to play at an event. TV music is one of the oldest forms of sound files to be shared via computer, (I remember doing it on BBSs and later FTP sites). I spent $110 at the mall instead of downloading files that are in abundant supply on web sites (not to mention P2P). I, of all people, have the time to download music, but it's more convenient to buy it. People who have $15-20 to spend on CDs instead of something vital (food, rent, etc.) will pay for that convenience. Yes, the CDs are overpriced, but that's just more evidence of the music industry's cluelessness.
  • The webcasters and the record industry both agree to do something!
  • just like everything else in the .com space over the past year, things need a little renegotiation. The courts will agree. While the plaintiffs want to thing in terms of contracts and black and white, the judges aren't idiots. The law tends to favor actions which enable businesses to stay in business.

    - SV

  • Webcasting Royalties? (Score:5, Interesting)

    by Synchis ( 191050 ) on Sunday March 10, 2002 @01:15AM (#3136884) Homepage Journal
    I'm not sure about other wedcasters, these are just my opinions.

    The very idea of having to pay royalties for the songs I play through a web cast is outrageous. I run a shoutcast from my computer, the playlist is managed by my girlfriend. The bitrate is set much lower than cd quality, and is really mostly for her and her friends enjoyment. The thought that the RIAA wants to charge me for broadcasting sub-standard quality music that one could record just as easily from a radio, is absurd. Radio stations broadcast music for several reasons:

    1. entertainment. This I would rank as the primary focus of radio stations... people want to be entertained, and the less it costs them, the better.

    2. To promote the artists. Lets face it, without radio stations and music video channels, most people would never buy the albums from the local music store. We hear a song that we like, find out who its by, and buy the album. I don't believe I have ever heard of somebody going into a music store and picking a random album and buying it because they thought it looked interesting. The music industry just doesn't work that way.

    Why should I have to pay the music industry to entertain there fans, and to promote there music? When was the last time you heard ANY company complain about free advertising?

    I could see the headlines now: "Microsoft Sues small-town software company for promoting microsoft software." This doesn't make sense, and neither does royalties on webcasts. Forcing webcasters to pay a royalty on a webcast is like making them pay the RIAA to promote the RIAA's product.

    There is no piracy involved in this. There is no music bootlegging, or recording and any such thing. If the webcast listeners want to record and distribute illegal copy's of 24kbs, 22.05kHz, Mono music, by all means, let them. But do not make the webcasters pay for this. We want to entertain, and we want to promote our favourite artists. This is all, and the only fee we should have to pay, is the fee to obtain legal copy's of the music to begin with. This would merely involve taking a trip to our local music store, and purchasing a copy of the artists album.

    • >The very idea of having to pay royalties for the >songs I play through a web cast is outrageous.

      hey, guess what. it's called copyright. to make use of copyrighted material, you have to pay for it. bitrate quality, or no bitrate quality.

      i work for a public radio station. we have a rather shitty transmitter. the sound is rather hissy. probably the equivalent of your shoutcast. should we forfeit on our royalty payments because of that? no, because it's the law, and we do what we have to do.

      >1. entertainment.
      >2. To promote the artists.

      as much as we'd all like to believe that, 99% of radio is about stroking the announcer's ego and getting advertising/sponsorship sales.

      for many artists, radio royalties are the only way they make any money. if your song gets played on a station that submits playlists to the royalty company, and you have submitted a claim, bingo! i know someone that actually made something like $30000 in radio royalties one year, but sales of the actual product were tiny.

      >This would merely involve taking a trip to our >local music store, and purchasing a copy of the >artists album.

      sorry, you've bought yourself a single person license which allows you to play your one copy only on one stereo at one time, and you may not make copies unless you are a licensed broadcaster - in that case you can make one 'ease of use' copy.
    • I don't believe I have ever heard of somebody going into a music store and picking a random album and buying it because they thought it looked interesting.

      I did that once. I bought this CD [towerrecords.com]. It wasn't great.

  • Copyrights vs Patents (Score:4, Informative)

    by cybermage ( 112274 ) on Sunday March 10, 2002 @01:18AM (#3136885) Homepage Journal
    I wonder what the founding fathers would have thought of these guys taking copyright to such an extreme that it threatens the usability of new technology.

    Engineers have taken the time to create, patent and license technology to stream audio over the web. Now, copyright holders of the audio content are trying to price content so high that the use of the patented invention becomes infeasible.

    I would think that copyright was never intended to be a weapon to strangle invention.

    Just my $.02. Keep the change.
    • The founding fathers would probably also be surprised that there was a debate over extended unemployment by 13 weeks and that every American pays income, social security, and medicare taxes.

      But just because some copyrighted material will require licensing and payment, that doesn't mean all streaming audio is affected. If I record a program, which I do every week, I can put it online and stream it, because I own the copyright, and the technology to do that exists. Just because we have a new medium (internet streaming) doesn't mean we throw out the existing laws on copyright.
      • But just because some copyrighted material will require licensing and payment, that doesn't mean all streaming audio is affected. If I record a program, which I do every week, I can put it online and stream it, because I own the copyright, and the technology to do that exists. Just because we have a new medium (internet streaming) doesn't mean we throw out the existing laws on copyright.

        I'm not advocating trashing copyright. What I'm saying is that using copyright to choke off the technology is an abuse. Try comparing these figures:

        From the article:

        At issue are fees that online radio services would have to pay to artists and record companies for each song played. The fee is $1.40 per thousand listeners for Internet-only stations, and 70 cents per thousand listeners for over-the-air stations that simultaneously broadcast online.

        From BMI [bmi.com]:

        If the station is among the top 25% of stations which paid the highest license fees to BMI in the previous year, each performance of a popular song on that station will be paid no less than 12 cents total for all participants.

        Unless I'm misunderstanding something, the RIAA wants atleast $0.70 per performance to 1000 listeners over the net. Meanwhile, they charge $0.12 for X listeners at the largest radio stations (where X is likely to be greater than 1000.) If this isn't abuse, I don't know what is.
      • Blockquoth the poster:

        Just because we have a new medium (internet streaming) doesn't mean we throw out the existing laws on copyright.

        Actually, historically, it does mean exactly that. Then the laws are modified, pulled, twisted, reworked, and shoehorned so as to cover the new medium, but usually with new features.

        Originally, performed music wasn't covered at all by copyright, which was assumed to cover only printed works.

        Originally, mechanical reproduction of music wasn't covered (player pianoes, anyone?). Congress eventually invented the idea of a mandatory license.

        Originally, one could not have made personal copies of over-the-air broadcasts. Then VCRs came along and the courts -- followed eventually by Congress -- carved out new space for personal copies.

        The point I'm making is simple: Copyright law most certainly adapts to new technologirs. There is no a priori reason that previous models, like radio, should (or should not) be applied to Internet streaming.


        Take a lesson from 1984: The most effective means of control, for a tyrant, is to convince people that the terrible system in place (a) will always be in place and, more crushingly, (b) has always been in place. Don't subscribe to the manufactured history of the RIAA.

  • hmmm... questions (Score:2, Insightful)

    by nameinuse2 ( 553722 )
    why exactly is this a per *listener* royalty charge? shouldn't it be per *song*?

    what if they "own" exactly zero percent of the content being webcast?

    • Same reason the tax from Audio CDR's go straight to the RIAA, regardless of whether they were actually used to burn their songs. The idea that they do not in fact own all audio content in the world doesn't compute.

  • The CARP is out for revenge... (Score:3, Interesting)

    by Myrv ( 305480 ) on Sunday March 10, 2002 @01:40AM (#3136935)
    Ok, so the current rate for over-the-air broadcasters is $0.0022 per listening hour [pcworld.com] . Or assuming 4 and a half minutes per song,

    $0.0022 / ( 60 / 4.5) = $0.000165

    or .0165 cents per person per song. And they want webcasters to pay .14 cents per song. What the hell are they thinking?

    The people on the panel must have invested money at the height of the dot-com boom and figured it was payback time....
    • Thanks for the math. Very interesting. I see two potential explanations for this:

      The Internet is a magic place where money appears out of nowhere, and none of the old rules apply, because, well, it's the Internet.

      Or maybe they don't really want to license their music to anyone else.

      Take your pick.

      Rules are being remade. Soft money is being passed out like candy. At long last, they will control who is listening, when they listen, how often, where, and make them pay every time. What a beautiful time for the RIAA.

  • ARGH!

    We are dealing with numerous issues at the same time in situations like these, and we need to deal with each piece before we can really solve this situation.

    • Values: At the heart of the whole debaucle are our values. Most of us have something (software, silverware, clothes, etc) that we didn't pay for, and we don't feel bad about it. Well, we all add up. And as a whole, we are getting worse. I'm not saying we should all go out and buy a new copy of Photoshop, but somehow we bastardized "freedom of information" into "information for free" - just because it's not illegal to read a book doesn't mean you can just take a copy.
    • Interests: We all have our own interests at heart, and alot of us try to consider other people, too. If not, no one would have subscribed to /. - they would use junkbuster. Well, the record companies are out to make money. And if they don't make any it will be alot harder to get any music, bought or downloaded. The problem is the RIAA has a huge infrastructure to support. The guy-down-the-street store can put out something as good for a comparable price, but he can't put out 200,000,000 no matter how hard he tries. The RIAA wants money because it wants it and because it needs to support itself.
    • Rights: Even though the Apple iPod is set up so you can't copy songs to a computer (and there's a big sticker on it that says "Don't Steal Music") there are already two programs out there that let you circumvent that. Is that bad? No. Should we use it? Maybe. The problem is that security is only as useful as the conscience of the people using it. If the RIAA managed to shut down every media sharing program but streaming Internet radio was still free, programs to turn the music into standard mp3s would circulate like wildfire. Normally people have a privilege for a long time to think of it as a right. But we think of large-scale essentially anonymous p2p file sharing as a right, and that hasn't been around more than a few years. Many think of free music as a right, even some artists. But until we reach Gene Roddenberry's dream of not needing money and all just getting along, that just doesn't work. We aren't fighting over exact dollar amounts (though that does come into it), we are fighting over privilege versus right. Not something new to anyone who ever had a drink, owned a gun, or voted.
    • Newness: In case nobody else seemed to notice, the Internet is still brand-spanking new by "real world" standards. When was the last time a college student had a idea and revolutionized the telephone - striking panic into huge corporations? We are still dealing with technology the capabilities of which are still being discovered. We are at a point where access is getting easier, but there are still few ways to connect the user to the experience. (I don't mean this in the Big Brother sense, I mean this in the sense that I have to log into /. at every friends house - no way for it to come with me.) Basically we need something between having a World Identification Number tatooed onto our eye that it logged in the International Database of Everything Online and the anonymous free-for-all that is the 'net today.

    Alright, I'm down off my soapbox. Just remember that there are reasons, even if we don't know them. The goverment doesn't just keep secrets to piss us off, and the RIAA doesn't want our money just so we can complain about it. The RIAA wants our money so it can be there to complain about in the years to come.

  • That I agree with the RIAA. Let them make thier own deals with each company. Watch how very very few or even none at all come to them. Hence blocking off the entire source of income. I hope the RIAA wins it. Also I wish the streaming places to start doing more indie work along those lines. Perhaps if the RIAA can see that they will get either a small % or nothing at all we will see how greedy they are. then if the RIAA starts thier own streaming we can organize a boycott to deny them money.

    But the thought really hurts those who are making a living streaming the music as it stands. So my idea is probably a bad one. Tis a thought though.

  • Why would the RIAA want to fight streaming compulsory licenses? Because of Pressplay and Musicnet of course! The RIAA wants music to be pay-per-listen, and Musicnet and Pressplay, are an attempt at that. Letting other companies stream music competes with the 200 streams a month offered by Musicnet. Why take money from the middleman(Webcasters) when you can screw the customers yourself?
  • Does anyone know if there is currently any legitimate, ie. agreed upon by real law-makers, law or legislation anywhere that says radio stations must pay for internet broadcasts? If so, where would that information be found, and does anyone think that such a law could be effectively policed, given the vast number of radio stations across the US alone?
  • SaveInternetRadio.org [saveinternetradio.org] or http://208.3.135.80/ [208.3.135.80]

    Good clearinghouse on the whole issue and links to your representatives. Speak out now or shut up later.

  • Could Webcasters... (Score:3, Interesting)

    by Greyfox ( 87712 ) on Sunday March 10, 2002 @03:05AM (#3137068) Homepage Journal
    Could webcasters negotiate their own royalty structure with independent bands? Sure you're getting a mixed bag when you do that, but a lot of the local bands I've taken in in various cities have really good stuff. Why not just tell the RIAA to get bent and only do business with musicians who aren't owned by "The Man"?
    • Could webcasters negotiate their own royalty structure with independent bands?

      The time and overhead costs of dealing with 100's of independent bands would be prohibitive. It would be cheaper and easier to cut one check to the RIAA for the proposed amount.

      I'm not saying the proposed royalty structure is good, just that negotiating with lots of independents is worse. I think it covered in the article last time.

      -

  • Comment removed (Score:3, Insightful)

    by account_deleted ( 4530225 ) on Sunday March 10, 2002 @04:44AM (#3137210)
    Comment removed based on user account deletion

  • Here's an idea... (Score:5, Interesting)

    by JoeShmoe ( 90109 ) <askjoeshmoe@hotmail.com> on Sunday March 10, 2002 @04:46AM (#3137212)
    What exactly has been done to define "webcasting?" The very term seems completely outdated. No one uses the "web" (HTTP) to deliver music any more. So what is the difference between webcasting and standard radio? Let's examine.

    Is it having a web page? Of course not. Regular radio stations have web pages, same as webcasters. So clearly the web page itself is not the key factor.

    Is it being digital? I don't think so. Consider the new XM satellite radio systems as well as small regionalized experiments with digital radio transmissions. Yet these would seem to be considered closer to tranitional radio than webcasting.

    Is it being interactive? This is a big issue for the record companies...but how much control is required before something is interactive? Almost every radio station lets you e-mail song requests. So then, if a "webcaster" used the same mechanism, and disable any form of direct control, wouldn't they fall under the same category as radio stations?

    Is it the content delivery mechanism? Consider the hypothetical situation where my computer has an FM radio card. Clicking on a link tunes my radio card to a radio station playing the song I want. Now I'm doing something interactive, web-based, and on-demand...everything that would seem to point to it being a webcaster, but since the music is coming in over standard radio waves, is it?

    All of this brings me to my idea...let's grow 802.11 wireless networks specifically for broadcasting music. We aren't webcasting, it's radio wave transmission...same as regular radio stations. The 802.11 spectrum is licensed by the FCC, same as regular radio station.

    Then once we are all broadcasting music via radio waves in our localized region, let's join the NAB and pay the same low royalties as regular radio stations. Could they stop us? What could they use to draw a distinction between one form of radio wave carrying music and another?

    - JoeShmoe

    .

    • What could they use to draw a distinction between one form of radio wave carrying music and another?

      Probably the Commercial Radiotelephone License. 802.11b may be in a licensed band, but the license terms are that anybody may use it--the license follows the device. (Actually, it's more like an unlicensed band--as long as you comply with power, signal purity, etc. requirements, you can use it). Radio stations (traditional) are licensed for a broadcast of x watts on y frequency, plus individuals are licensed with CRL's. That's how I would differentiate between traditional and internet radio stations, if I had my head up my ass.

      • Radio stations (traditional) have to worry about stomping over another radio station that may be using the same (or nearby) frequency. So yes, there is a difference when you look at the technical level.

        But the "they" I was talking about was the existing royalty infrastructure, i.e. the National Association of Broadcasters. Do they distinguish one kind of radio wave from another?

        There are already three or four types of radio wave in use for the purpose of broadcasting copyrighted content (AM, FM, AM Stereo, XM, etc). XM is the most recent addition. Couldn't 802.11 (maybe call it iM?) be considered another a new one too?

        My point is that if I throw up an 802.11 antenna and start broadcasting music around my neighborhood, why can't I try to join the NAB? And if they tried to block my admission, wouldn't I have a good argument that the block is unjustified given the reasons mentioned in my first posting?

        On a similar tangent...the FCC was talking about allowing low-power FM broadcasting, so I wonder if I couldn't put up a local FM broadcast and then qualify for the lower rate webcasting fee, owing to the fact I'm rebroadcasting a radio signal over the Internet.

        - JoeShmoe

        .
  • It seems obvious to me why the "big 5" want the rates to be so high ...

    ... This is how they plan to steal the entire market for internet radio and put everyone else out of business...

    ... if the same five corporations that hold the vast majority of the important musical copyrights in modern popular culture all have "internet radio" divisions, then it doesn't matter how much the royalties are -- in fact, the higher, the better, for them.

    No matter what the rate is per song per listener, it won't put those five corporations out of business, because, for that specific list of five corporations that dominate the recording industry, royalty payments comprise what is very close to an in-house money transfer. They are in the unique position to be proportionally both the payer and the receiver, and if these royalty rates go through, they will have a guaranteed instant monopoly over internet radio. No one else could possibly afford to go into the business.

    Such an outsider -- someone else who wants to start an internet radio station. will have to pay the royalties, but unlike the big 5, who get most of the money back, they won't get ANY of the money back, because they aren't the copyright holders.

    Now don't get me wrong, the copyright holder should be paid ... but charging per-listener will create an instant monopoly. Like broadcast radio, the charge should be per-performance, irrespective of the exact listener count, and the rates should be identical to the broadcast rates. If anything, they should be lower, because internet broadcasts have markets that are smaller then radio broadcasts by orders of magnitude. Sky-high internet radio royalties serve no other purpose but to make internet radio uneconomical for everyone ...

    ... except for the "big 5", who are being handed a brand new monopoly on a silver platter.
  • Although I've been listening to Internet Radio in verious forms for some time now, it's only in the past two months that I actually became a broadcaster. It's a fascinating hobby.

    Speaking as someone who'd be directly affected by the imposition of royalties, I'm not opposed to them in principle. I think it's fair that I pay a reasonable fee for the use of someone else's product.

    Is the RIAA a bunch of evil monopolists? Probably. Are they hysterically trying to defend an obsolete business model by suing their enemies out of existence? Absolutely. Neither of those two characterizations change my opinion that it's fair to reasonably compensate someone for use of their product.

    My station is small, but growing. Under the proposed rate structure, my royalty liability for the past 30 days would be about $14 (9,683 performances multipled by $0.0014 per performance). That's inexpensive, but a 10x increase in my listener base (not that unreasonable, since I'm small) woudl jack that to $140 for the past 30 days. I'm not willing to pay that for a hobby that generates no income.

    The current proposal is unacceptable, but not because of the concept of royalties. It is unacceptable because it's designed to eliminate small webcasters. I'll support and adhere to a ruling that provides for fair and reasonable payment for use of the RIAA product.

    Duane
    dj@disintegrator.net [mailto]
    Disintegrator Internet Radio - The Best Of The 80s [disintegrator.net]

  • If you study biology, you will learn that the most succesful parasites are those that don't overly weaken their hosts. Parasites that suck the life out of a host kill the host, then they have to look elsewhere. Such parasites are more likely to die off.

    A lesson the RIAA (and MPAA) have not yet learned....
  • That's the wrong argument.

    As one industry website [saveinternetradio.org] points out,

    Note that the DMCA's rationale for granting performance royalties in the digital world was based on the concept that digital copies are "perfect" copies and thus the sales of CDs (called "phonorecords" in the act) might be at risk in this new "digital millennium." ...
    The myth of the "perfect digital copy" is just that -- a myth. This should be the heart of the attack. The argument that current royalty rates would put Internet radio out of business is irrelevent if you accept the claim that Internet radio is threatening to put the recording industry (a much larger industry) out of business.

    On the other hand, try this on for size.

    • Find a reasonably good quality net broadcaster.
    • Make a copy of a good song off of that net cast.
    • Make a copy of that same song off of the radio
    • Play back an original CD of the sound, followed by the netcast, and then the radio copy.
    • notice which is the best, and which is the worst.
    Although a 'perfect' copy of a CD is possible, it takes 300Kbits to do so. A 128Kbit MP3 is good, but I can tell the difference between a CD and an MP3 when played on my rommate's (MP3 CD capable) car stereo.

    Internet radion, on the other hand, rarely reaches those rates. looking at the Real audio's tuner page shows 3 station: [real.com]

    KASR FM Radio [real.com] (sports) broadcasts at 20Kbits/second (I'd describe it as grotty)

    Euromix Radio [real.com](" Pop to house, trance, techno and energy remixes from DJ Daizzy, ToolMix, Terry Tate and..") broadcasts at 32K bits/second. This is actually better quality than many netcasters, but you can definitely tell that it's a net cast. even with pure voice content in a language I can't understand. KASR radio [real.com] (specializing in classical music, and thus a good representative of the "high end" of the quality scale) broadcasts at 64Kbits/second. Decent quality, but -- at 6:30AM, on a Sunday -- they're at their audience limit. I can still hear the bite of audio compression (when I can reach them). --- In fact, they're not up to the quality of AM radio -- much less FM.

    Going to their search listing for "Seattle", (where Real Audio is based) shows stations rangingr from 20K bps up to 96K for Groove Radio (split between audio and video). I actually found a listing for a Chicago station that claimed 256K/sec, but I couldn't get to them. (I'm guessing that they're also a video/audio mix).

    When I worked at GlobalMedia.com (now defunct), we had people who could squeeze the last bit of quality out of a 64K audio stream... (some webcasters don't quite understand what the issues are for getting a decent quality webcast). Even so, the quality never stood up to broadcast radio -- much less the CD player on my computer going through my (25 year old) receiver.
    -----

    Once you debunk the 'perfect digital copy' myth, then you can get on to the question of what's a resonable royalty rate, as opposed to what would compensate the RIAA for their supposed loss of business.

  • Judges know when they've made a good ruling if both parties are unhappy. ;-)

    -Adam

  • royalty should depend on bandwidth (Score:3, Insightful)

    by uncadonna ( 85026 ) <<moc.liamg> <ta> <sibotm>> on Sunday March 10, 2002 @01:30PM (#3138112) Homepage Journal
    I think a royalty schedule is reasonable. It is realistic to charge such a royalty proportional to music quality. The simplest method is to charge reasonable royalties for CD quality stuff and to give away MP3s. An advantage of this approach is that any copyright holder can institute it deliberately and immediately without fuss or bother.

    Music industry: get a clue. Copyright violation is your enemy, but MP3 is your friend!

    Sites distributing MP3s and similar reduced bandwidth/quality representations of the CD material should not be punished. The folks who claim they should get rewarded, rather than punished for promoting the material with low quality copies have a point.

    If a major music label says "and we won't charge any royalties or enforce copyright on MP3 or other lower quality recordings because it *helps* our business move high quality digital product" it will be a gigantic PR and marketing victory with no downside to speak of.

    Such a policy would both contribute to the community of ideas *and* to the bottom line. Enforce copyright on CD quality reproductions vigorously, and give away the MP3s like business cards!

    You will

    • stop treating your customers as enemies
    • preserve intellectual property
    • revitalize the music culture
    • preserve and enhance revenue
    • win over your more reasonable and mature critics

    You don't have to get agreement from the other labels. (They may be forced to follow, but the first label to do this will get a huge PR boost.)

    Record labels: think! Read Drucker's Innovaton and Entrepreneurship. MP3s are your friend. Give 'em away, open-source-like. Hold the copyright but give away the right to low bandwidth copies.

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