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Webcasters and Record Industry Both Appeal Royalty Ruling
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.
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.
"Information wants to be expensive" - Stewart Brand, the same guy who said "Information wants to be free"
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."
... if anyone can answer that for me without being flippant, I'd love it.
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
Have we ever seen any industry at any other time do the same thing?
That argument is libertarian bullshit that's totally ignorant of history.
The record industry has historically abused its monopoly power at every chance it had. It's happening today, it happened when radio stations first became common, and it happened when phonographs where first introduced. (Did you know that early phonographs could only be legally played on some phonograph players (those who paid the bribes to the copyright holders), and the records could never be loaned, sold, etc.)
The abuse was so bad that Congress made an exemption for phonographic copyrights, and phonographi copyrights alone. ANYONE can produce and sell a compilation CD of ANYTHING, and the copyright owner can't do anything to stop it as long as the compilation producer pays a modest compulsary licensing fee set by statute. Likewise radio stations and other commercial users can pay a compulsary licensing fee and tell the RIAA representative to get lost when they try to force the station to pay more, or change the presentation, or whatever.
On the one hand I'm surprised that the RIAA is trying this same shit once again. The public may not be aware of its sordid history, but the industry lawyers and regulators certainly are and there is absolutely no chance that compulsary licensing will be enacted for webcasts. The only question is the amount charged... and this proposal is *way* too high, and the burden to documenting individual users is far too high. In particular I remember that small college radio station example - the numbers were so high that I think it would be cheaper for the station to pay the compulsary licensing fee and distribute free CDs containing their entire playlist to every student than it would be to operate the webcast for a few weeks!
On the other hand, there's a libertarian born every second. Libertarian principles aren't bad, but most libertarians have a big blind spot when it comes to the fact that there are some "bad players" who have a CENTURY (or more) of demonstrated history abusing the rights of others whenever they have half a chance. Only the government is able to stop this abuse - individuals and smaller companies simply don't have the resources to fight them.
For every complex problem there is an answer that is clear, simple, and wrong. -- H L Mencken
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?
Wouldn't it be wonderful if the RIAA priced their homogenized crap out of the broadcast market?
"Hello, Listeners! Tonight I'm playing an album by a very talented group you haven't heard of yet. They haven't signed a deal with the RIAA, so we can afford to play their music."
"Those of you who called in requests for Destiny's Child and N'Sync, sorry! We can't afford to play that shit anymore!"
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
As one industry website points out,
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.
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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
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Play back an original CD of the sound, followed by the netcast, and then the radio copy.
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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:
KASR FM Radio (sports) broadcasts at 20Kbits/second (I'd describe it as grotty)
Euromix Radio(" 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 (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.
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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.
Sometimes boldness is in fashion. Sometimes only the brave will be bold.