Congress Passes SWSA

signer writes "Congress has passed the Small Webcaster Settlement Act (House of Representatives link). Webcasters have until December 15th to negotiate Percentage-of-Revenue royalty payments, and they have the option of changing their status to non-profit and gaining a delay until June 30, 2003 to pay owed royalties from previous years. RAIN (www.kurthanson.com) has details."

Comments

The Real Question is?

[1stflight]

IS this settlement good or bad for the webcasters? Personally I'm of the mind that radio by defination is free promotion, the webcasters should be charging for it.

Re:The Real Question is?

[pla]

No, not all that great.

For one thing, the RIAA's slice of the pie still comes from *gross* revenue, meaning that stations operating with only a tiny profit margin will get very very screwed.

Another poster already mentioned the $500 minimum, but that I see as less of a problem, only affecting the smallest of webcasters. The percentage of the gross take, on the other hand, doesn't go away regardless of scale.

I have to admit I don't quite get the part about non-profit webcasting (the text of the bill HEAVILY references its predecessor, making it read almost exactly like a diff file). It sounds like they just have more time to decide to fold, but don't actually get significantly better terms. But don't quote me on that one.

Re:The Real Question is?

[mumblestheclown]

"free promotion."

That's up for negotiations to decide, isn't it? One side POTENTIALLY benefits from "free promotion", the other from having some filler between advertisements (or some other benefit).

Making things interesting is that in the marketplace of music, webcasters can always go to alternative music sources if they can't come to what they think is an equitable agreement with their first choice rightsholders--be that agreement the rightsholders get paid, pay, or whatever.

in life, you get what you negotiate.

Re:The Real Question is?

[FreeUser]

That's up for negotiations to decide, isn't it? One side POTENTIALLY benefits from "free promotion", the other from having some filler between advertisements (or some other benefit).

Well, that is the theory. But that assumes both sides come to the table more or less as equals.

In reality, the media cartels have a vertical monopoly on content from the artist's gitarre strings to the listener's earphone, whether that path passes through the radio or television spectrum as a traditional broadcast, or through the retail chain as a shiny 6" disc.

The relationship is more complex than this (the cartels are currently crying foul over radio payola ... not because of the payola, which gives them almost complete control over what we hear on the radio, but because of the prices they are currently having to pay. They are asking the government to step in and slap the otherside down, so they can maintain their control, but at bargain basement prices instead), but overall they enjoy a vertical monopoly they are loathe to give up.

mp3.com represented a threat to this, before the cartels coopted them into the regime. Web broadcasters represent a threat to this, as do p2p filesharing networks. Their concern isn't that their content is being played (indeed, they pay for exactly that privelege on traditional radio), their concern is that their content isn't the only thing being played and, worse, they have no way to control that.

Except, of course, to tell a webcaster to "play our play list or pay (exhorbitant) retail to broadcast our music", using their current market dominance to relegate those who say no to a tertiary status, and likely costing them the early listenership they need to stay in business.

Its not that they don't want webcasting, or that they expect to make a lot of money licensing webcasters. Its that they only want THEIR webcasters online, and no one with such a cartel/monopoly mindset will ever negotiate with a party such as the webcasters in good faith.

So, until copyright is reformed to no longer grant government entitlement monopolies, there will be no free market in which such negotiations can take place, indeed, no free market whatsoever, so one cannot reasonably expect acceptable results to arise from applying free market assumptions to what is essentially a planned and very precissely regulated market.

after they pay these royalties...

[Anonymous Coward]

they'll all be non-profit.

comments from somafm

[pengwen2002]

The folks at somafm have some interresting links and comments too.

There's nothing wrong with this bill

[SexyKellyOsbourne]

Honestly, how would you feel if something you put hours, days, and even weeks of effort, heart, and soul was being played FOR-PROFIT by a pay radio station by someone without your permission?

Whether non-profit p2p and netradio is stealing or not can be debated -- but when someone takes an artist's hard work and plays it over the internet with the sole purpose of making money, it is blatant thievery of intellectual property and disrespect of copyright, which does have a right to exist to spur innovation in an economy that is, was, and shall be capitalist.

Re:There's nothing wrong with this bill

[pla]

Umm... Have you looked at the business model of a conventional broadcast radio station, lately?

They do *exactly* what you say seems so "wrong" for webcasters.

And, to add insult to injury, the RIAA actually *PAYS* "normal" radio stations to play that copyrighted music.

The pigs are flying.

[DaveOf9thKey]

I've lived in North Carolina for more than 20 years, and this may be not only the first time Jesse Helms and I agreed on something, but the first time I wanted to stand up and applaud him for following through on it.

Clearly, the apocalypse is coming. Someone tell the FBI...

Non profit status =

[Crusty Oldman]

Non profit status = special license = jurisdiction = control

Just listen to webradio from other countries then

[hazzzard]

Well, I don't really care where the music comes from.
Even if you don't understand the foreign languages,
there are tons of webradios elsewhere
that will not suffer from these problems
(i.e. don't have to do massive advertisements to afford casting good music).

• Antenne Bayern (Bavaria, Germany) - click on "Live h\"oren"
• FFH (germany)
• HR XXL (Germany)
• BBC (UK)

Does anybody have some links to good webradios in Italy, spain, mexico etc.?? Please post!

well?

[Anonymous Coward]

Like most slashdotters, I have a busy, active lifestyle. And when I read about these new political events, I need to know up front: should I be please that the little guy is finally getting a break, or should I be pissed off that the MegaCorps(tm) are gorging themselves with another piece of the public pie?

Frankly, I can't tell by reading this summary. I'm forced to read the article and background information to form an opinion of my own, rather than sharing in the poster's rage (or satisfaction) at this travesty of justice (or victory for freedom)..whatever it is.

Please slashdot...let me know what I should think.. maybe an icon next to the story?

I've always wondered

[m0rph3us0]

I fully understand having to pay royalties for playing music that is copyrighted, but I am wondering if I play music that the owner of the music licenses me to play do I still have to pay RIAA? Maybe one of the legal eagles out there can answer this for me.

Thanks,

washingtonpost.com story has details

[rhwalker22]

washingtonpost.com's story quotes several small webcasters praising the compromise bill. According to the article, the bill "does not establish specific royalty rates for webcasters. Instead, it authorizes the music industry's principal royalty collector, SoundExchange, to negotiate binding royalty contracts with small webcasters on behalf of all artists and record labels." Strange footnote: Sen. Jesse Helms had a big stake in the bill as he successfully protected small religious webcasters from the royalty axe.

There seem to be TWO possible outcomes.

[JessLeah]

1) Web radio dies, or goes "underground" and just becomes a lot less popular, and a lot more scary to be involved in. (due to the new-found illegality thanks to this bill)

2) Web radio stations start playing works by independent (non-RIAA-affiliated) artists en masse-- thereby avoiding having to pay the RIAA a red cent.

Actually, there's a third that is somewhere in between: 3) Web radio stations start playing only "mixed" versions of RIAA tunes, claiming that by producing a "modified, derivative work" it is legal. Then this gets hashed out in court, or worse in Congress...

As I see it, though, (1) is by far the most likely. Lots of the SlashDot types might be interested in indie music... but remember, lots of the listeners of these online stations are/were regular Joe-Blows. They want to hear Queen and Sting and Madonna and Eminem and Snoop Dawg, not (insert obscure indie band name here).

Le sigh... But if outcome #2 was the case... that would be very nice.. and might even spark a nationwide change in buying habits (i.e. people would start buying more indie music, leaving the RIAA bit by little bit... of course, this would only affect the mostly young and relatively Internet-literate (not necessarily computer-literate, but they're familiar with the Net and much of its underlying tech) folks who use Web streaming...)

Re:Percentage-of-Revenue royalty payments?

[mumblestheclown]

Probably not percentage of revenue, but were you to use Led Zepplin's "The Lemon Song" playing on a jukebox as part of your stand's self-promotion, it would probably be wise to come to a flat-fee licencing agreement with the rightsholders in order to protect yourself. This is not meant to be funny. Don't mod it +1 Funny. Don't!

Sade

[dolo666]

I'm not normally a Sade fan, and I remember holding some disdain for her music in years past (80's). But after hearing some of her recent stuff (downloaded via Gnucleus), I bought her album and went to her concert with my wife.

Exposure sells and it's the RIAA who are scared because maybe we don't want to buy the crap they are carpet bagging... maybe we will hold out for something better. They don't trust themselves.

One hit wonders shouldn't sell any records because the rest of their albums suck. While good musicians and artists who sweat blood to make amazing albums are still left behind. If the internet could do anything, I think it would even things out so real musicians would make the money they deserve and fluff bands get downloaded for the song that's good and passed over for concerts and cds.

Good music will always sell.

Re:Annual minimum royalty

[Liquor]

There is an annual minimum royalty of $500, which means that the smallest of small webcasters may not be able to afford it.

Umm... I think it's even worse than that.

I'm no expert at translating from legalese, but it sure seems that $500 is for past revenues, in 1998 - and there's a $2000 per year minimum after that, i.e. $6K for 1999, 2000, and 2001, and then another $2K minimum for 2002. And that's just to settle PAST broadcasts. So there's a minimum outlay of about $8500 for ANY webcaster that's been around for those years.

Even if a webcaster is non-profit, with no income, they want 5% of expenses - still subject to the minimums.

Oh, and you're a small webcaster until you make more than a $1.25 Million?

What the hell?

[JanusFury]

Why on earth do non-profit stations have to pay royalties? What the hell's up with that? I mean, come on. Isn't the idea of being non-profit that you won't have to pay excessive fees because you're not making any money? How do they expect non-profit webcasts to pay excessive fees just to broadcast songs to all twenty of their listeners? It's not like there's big money in webcasting...

Clear-channel

[Triv]

This is slightly OT, but I realised something disturbing a few hours ago and it does relate to the radio/webcasting debate in a roundabout way.

I've got a friend coming into New York tonight, so I figured I'd check out a few local venues to see who's playing, what's going on and all that. One of my favorite music venues is Irving Plaza. (flash site) I like going to random shows, I like supporting local music and I like circumventing the RIAA as much as is possible.

Chck out the link above - see what's in the lower left-hand corner of the homepage under the Irving Plaza logo? "Clear Channel Entertainment."

Fuck.

I. Can't. Get. Away. :(

Triv

Re:What about classical stations?

[Frobnicator]

what happens to classical stations now?

I assume you are talking about the time, and not the style? Nothing changes for those people.

The music itself is in the public domain.

The PERFORMANCES are owned by someone. If you have 1845 recording from the London Symphony Orchestra, that's in the public domain. If you have a 2001 perfomance of the same work by the same Orchestra, then you need to work out the rights.

frob.