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Copyright Office Publishes Final Webcasting Rates
Ghaleon writes: "The Copyright Office just released the final rates for webcasting. Looks like the rates are lower than the CARP recomendations, though I'm no webcaster so I'm not sure if these rates are good or not ..." nbrimhall points to a bit more at soma fm as well. Update: 06/20 21:54 GMT by M : See our last story for background information. The final rates are nothing to cheer about: most webcasters will not be able to afford them. Update: 06/21 03:13 GMT by T : An anonymous reader points out the continuing coverage at kurthanson.com, including reactions from Reps. Boucher and Inslee.
Well, the government has spoken, and the rates have been set, at a level high enough to kill webcasting as we know it. The RIAA must be cheering -- if they're not planning some sort of appeal to raise the rates even higher.
Personally, I think the RIAA has just finished the job of cutting its own throat.
Let's look at the facts: These rates apply to "commonly available" music, as a default royalty system. Webcasters are free to sign contracts with content performers and bypass these rates entirely. "But there's nothing good out there!" For now, perhaps.
Thing is, broadband is spreading like wildfire, as is the potential audience for webcasters, and more people will be edging to push their way into it. I'd expect to see underground webcasting stations pushing unknown bands grow common, and then some of them (both stations and bands) will grow increasingly popular. Meanwhile the bands pushed by the big labels (and big prices) will seem more and more stale.
The end result will be the decline and fall of the record companies, which will probably drag their signed artists down with them. Oh well.
Traditional radio stations pay the rates and fees that they do, at least in part, because they are given slices of the "public" radio bandwidth by the FCC for their broadcasts.
The biggest problem with the new rate structure is that completely non-commercial, amateur Internet broadcasts, which are entirely *legal* (unlike their radio equivalents) will be *effectively* prohibited by the fees, tracking requirements, and back royalties enforced by the FCC.
Today we see another fine example of the federal government becoming the enforcement arm for major corporate interests. This new fee system was not made to benefit consumers, or to protect the innovative world of Internet audio broadcast, but to answer the fears of the RIAA.
Big conglomerates already own something like 80% of the radio stations in this country, and this new set of regulations will give them all the bargaining chips in snapping up any popular Internet stations. So much for finding new, interesting music on the 'net...it'll be Top 40 for everyone, from here on out.
But all players are free to negotiate any other terms, including lower terms, and including free for bands that want to get more play for their music and don't want the revenue.
This is a maximum because if they ask for more than the .07 or .02 cents, an internet radio station can just invoke the compulsory license and pay that lower amount.
Think this through again. The norm for copyright law is you can't perform somebody else's copyrighted work without permission. This ruling (common in the music industry but not elsewhere) says that you don't have to ask permission, you can just pay this fixed fee. If you go get permission you can arrange any fee both parties want. This ruling came down because people could not agree on fees.
In the end, this might mean that independent labels, which can now band together and declare lower fees for their music, dominate the airplay on internet radio stations. They might even declare free airplay for their stuff. This could mean independent labels begin to dominate the big labels on the internet.
Already projects like the Creative Commons are defining ways for works that want to allow free play to encode it right in the file.
Frankly, I don't think the government should be setting the price of music at all, however.
In addition to the other good followups that have been posted, another difference between broadcast and Internet radio is that an Internet station cannot possibly serve as many listeners as a broadcast station.
The more listeners the Internet station has, the greater its bandwidth costs -- whereas with a broadcast station, more listeners in the broadcast area do not mean higher costs. That means advertisers would be willing to buy advertising on broadcast radio, giving them an income stream that Internet radio will never have, and that can be used to pay royalties.
I do think it's absurd that a 500-listener Internet station has to pay the same per-song royalty as a broadcast station that could cover an area with millions of potential listeners.
This is just another example of the media Goliaths destroying everything they don't already control.
- Have a picture
Seriously. I've had a lifetime of listening to recordings, and get far too little live music in my life -- and I seek it out and go. This ruling applies to recordings. But... imagine what a grand thing it would be to have an internet feed from a jam studio where musicians came to make *live* music, not Muzak. Where musicians came to make the music live and breath, to make mistakes, to laugh, to improvise meandering, soaring solos -- to share the joy that is true, live music. Why can't we have this? Recordings are so sterile, so frozen in stone. So the same-every-time. Let's have some real music.
Here is what will happen:
Internet Radio continues to grow/develop, outside of the United States.
The number of US-based listeners continues to grow.
Non-US based Internet Radio stations begin to generate revenue.
US-based groups and industries begin to realize that they are missing out on a large stream of revenue/listerners, and begin to look for changes.
Sometime in the (near) future, new laws are passed that open up the United States market for Internet Radio.
So while I'm disgusted by the Copyright Office's decision, I have to say that I'm cautiously optimistic. Optimistic that sometime in the future people will realize what a big mistake this was.