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I don't know about ClearChannel, but one of the most successful radio stations in the country, KROQ, would face fees that are four times their yearly revenue, and would grow to twenty times yearly revenue by 2010.

http://www.idobi.com/news/?p=25408

This is the crux of why everyone is so upset - it's impossible to grow to any significant size and be ad-supported under the new rates.

An example:

KROQ, "the nation's top rock station", would owe $1.4 _billion_ in royalties in 2010, if they paid the new internet rates. Their annual revenue is around $67 million. They are a highly successful radio station, and don't have to pay the per-user bandwidth fees that internet stations do (economies of scale). See the problem?

I run idobi Radio. We're an alternative/rock station that's doing fairly well, in terms of popularity.

The rates set by the royalty board is incredibly high and completely unfair. I agree I'm bias on the issue, but if the current rates are upheld, we would be required to pay $900,000/year just in royalties.

The current rates, if applied to traditional radio, would require a station like KROQ in Los Angeles to pay $1.4 billion/year just in royalties. Last year, they mad $67 million in revenue. If one of the most successful traditional radio station cannot afford these royalties, how can any internet radio station that still developing a revenue base be able to?

http://www.idobi.com/news/?p=25408

. Radio, whatever the transmission medium, is advertisement.

they want to charge Radio stations for royalties? great, let them

Internet broadcasters have problems because bandwidth cost money. For an internet broadcaster, the more popular you become, the larger your overhead in bandwidth costs.

In my experience in running and internet radio station (idobi Radio), i have to weight advertising the station against our ability to support new listeners. A successful campaign means we double our listeners, but it also means we have to allocate bandwidth to support those listeners. Advertising income does not yet match internet radio listenership, and depending on instream advertising to pay for your station is currently a losing proposition.

If anyone has ideas, I'm open to them.

Except to be a fair comparison, the picture should be more like this.

That ain't going to happen when your album is out of print because you are one of those 9 out of 10 bands that were not popular enough.

Except we're talking about allofmp3.com, and none of those albums are out of print...

You really are quite naive about the way the American music industry works.

I run http://idobi.com/... a lot of my friends are in bands, both indie and major. Some of my friends run indie labels. I'm hardly naive about how the record industry works. Bands may fail to make a second album, but that's because the label decide that they are not profitable. Not buying albums or paying in royalties won't help the situation.

Radio stations don't pay RIAA. They pay performance royalties to ASCAP, BMI, and SESAC.

And artists could very well be paid more for radio play than they do off CD sales if they wrote their own songs.

idobi Radio - Music that doesn't suck