Royalty hikes still scheduled to cripple internet radio
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After news earlier in the year of a proposed dramatic increase in royalty payments, it looks like internet radio in the US is indeed about to be dealt a stiff blow.
Radio stations with internet capabilities are facing a massive hike in charges under a new proposal from America’s Copyright Royalty Board (CRB) which comes into force in less than a fortnight (15th July 2007).
The new rates, decided on after much consideration by the CRB back in March, will see an increase in royalty payments for internet stations of "between 300% and 1200%" according to savenetradio.org, and will be retroactive from 1st January, 2006. It is predicted to cripple smaller stations’ net services almost immediately, and means the bigger stations – like publicly-funded, awesome Seattle station KEXP, whose award-winning internet broadcasts reach over 60,000 worldwide – will face an additional six-figure sum over the course of the next year, in addition to what they’re already paying.
The decision will see song royalty rates increase from 2005's rate of $.0007 to $.0008 per song played in 2006, and will raise steadily to $.0019 per song by 2010. The initial hike is only a small one, but given that the rate is multiplied by the number of listeners that hear the song, fears are that it will soon mount up - for example, a site that plays ten songs an hour and attracts an average of only 1000 listeners looks set to be charged over $8,500 extra for 2006 alone, rising to over $100,000 extra when the charges hit their peak at the end of the decade.
But enough of the maths. Appeals have so far been overturned by the CRB citing lack of new evidence. In protest, a day of (internet) radio silence was organised last month (26th June), in an attempt to draw attention to their plight.
Last week, Xfm pulled Jon Hillcock's overnight show from their schedules (after gradually turning it from something good into a playlist-only show) in favour of an overnight play-list only jukebox which spouts enough bland twaddle to make Hard-Fi look inventive – seriously, ‘Walkaway’ by Cast?! – so we probably need internet radio more than ever.
Whilst there's no doubt that an increase in royalty rates will eventually mean a small amount of extra money will be transferred back to the artists and labels, is the possible demise of the smaller internet stations really worth it?
Given that DiS is a chiefly British site, we probably don’t have a representative on Capitol Hill, but we do love internet petitions.
An alternative legislation has been proposed – The Internet Radio Equality Act – in a bid to nullify the CRB’s plans.
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i've really never understood
why non-profit stations have to pay royalties in the first place..
Guuuuhh
This is a depressing development this one. Hopefully enough minor/unoffical streaming stations will manage to sneak under the radar.
Surely
But...why....wait a minute...how....
Its probably because
so many people just illegally download music now, companies will go down any avenue to get their artists and themselves monies to cover these acts.
Downloading without following up in terms of an album/single purchase is so shit.
I don't know
much about this but Kill Rock Stars think that SaveNetRadio that the charges are fair and that it's the only way that artists will get paid fairly for their work.
This news post is a pretty one sided take on a complex issue, it is a shame I don't have the last KRS email anymore to give a decent counterpoint.
i see your point
but wasnt KRS' email just AGAINST the Internet Radio Equality Act, not in favour of the royalty hikes?
jon!
jon hillcock!
^that's the entirity of my comment.
this:
http://takecountryback.wordpress.com/2007/07/01/should-we-save-net-radio-the-qa/
explains it in more detail i think..
it just makes me sick that radio stations are going to lose their business from a royalty hike that (arguably) wasn't even needed in the first place, when all they ever wanted to do was turn people on to new music..
This is a death for internet radio
what's going to pay for it? Banner space? I don't think so! Listener contributions? I larf!
No, we're basically fucked here. The Seattle station you mentioned is a real radio station, they'll be fine. It's the SomaFM's that'll be history.
I always assumed this was hatched by major labels desparate to stay afloat, but I'm surprised (if true) that Kill Rock Stars would be onboard with this. Internet radio.. the internet period has done more to support indie bands than any other source.
this..
is shit. "way to go captain obvious," i know. but seriously. this makes me really disappointed. i only listen to radio via internet. the radio stations in my area suck ass. damn. is there any way we can stop this? i'd doubt it.. it seems as if they've already put a lot of energy into coming up with these new rates.. but.. fuck. artists get more than enough money. unless they suck, and then they should revise their act and get themselves out there.. which is usually by net radio..? i dont know about any of you.. but when i hear a really great song/artist.. i usually follow up by getting their stuff. jesus. this is just so depressing. ooffgh
i love soma fm
i will be sad if it goes, it's turned me on to so much great music.
People always think...
... of a way around these kind of things. I don't really think there's much to worry about.
i'm thinking
what they might start doing is calculating what they CAN afford, and limiting the amount of people who can connect to the stream.
i look forward to seeing this
ERROR! TOO MANY USERS!
can't we just start making death threats to shareholders?
i don't know of whom, but this is my answer to everything at the moment.
seriously, what is with all these attacks on music fans recently? who is it who wants us banned, or just supressed?
Yep
Seems quite backwards. But then again most internet radio stations might just play good stuff from unsigned bands who send them promos, plus the odd established track which will incur royalties. It might be a blessing in disguise for unestablished acts...
Internet Radio death
Sadly , I have already had to shut down my Internet Radio station , HotWire Radio , due to the threat of possible fee's incurred upon me by the stupid CRB and SoundExchange , I made no profit , only paid for licensing , and servers. I had a great DJ from the UK , DJ Control1 , along with about 12 other DJ's that I was sad to have to let go. This is such Crap ! When internet radio is gone , what will be next ? Charging more for CD's ? Stopping the distribution and creation of MP3's ? These people are on a witchhunt to make themselves look big , who gave all this power to these jerks ? I think they should do away with this armorment of idiots and let the artists create their own association ( Not the RIAA - aka the music mafia )that will cut out the middle man and give them their richly deserved royalties. America is really going downhill , we got a president that is a war monger , an association that caters to the rich and kills the poor in business , sometimes I am ashamed to say I am an american !!!!
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