Study Says $2.3B in Net Radio Royalties by '08

An anonymous reader writes "According to a newly published report, the music industry will have a nice pile of cash to collect from net radio owners in 2008 — a staggering $2.3 billion to be exact. The report is based on current performance royalties paid by terrestrial radio vs. internet radio, and taking into account projected growth in listenership. Meanwhile, the corporate Clear Channels pay just $550 Million for broadcasting the same songs we've all heard before. Hardly a fair deal."

Comments

Re:Two things...

[FlatCatInASlatVat]

Second, it is fair. It is called economies of scale. Clear Channel deals is huge quantities. To put it another way, if you go to a local corner market and buy a pack of four rolls of toilet paper for $2.00, then you go to Costco and see the same brand of toilet paper in a box of 40 for $10.00, is that unfair? No, it is called purchasing in bulk. Same as the sort of thing that MS does with corporate VLKs versus regular retail prices.

Wrong on two counts. Clear Channel and all other FM radio stations pay NO performance royalties. Yet the new rules would have inernet radio pay HUGE performance royatlies, relative to their revenues. (Both pay artist royalties. )

Also, much of the reason that the toilet paper costs more at the small store is because of local overhead. The suppliers charge somewhat higher rates to the little guys, but not many times as much, as is being proposed in the new rules from the Copyright Office.

Re:Yea, I don't think so...

[Abcd1234]

It was actually back in 2002, all thanks to the DMCA CARP ruling. The SomaFM About Page covers what they went through during that time. Now, with the latest fees, they're looking at about $1 million in royalty fees for the year of 2007, compared to $22,000 for 2006.

And all this just as I started listening to them... thanks a lot, Copyright Royalty Board. Assholes.

Re:Two things...

[Anonymous Coward]

Sorry bud, but the stations pay fees based on the estimated number of listeners (as part of the calculation, they multiply two other variable by that estimate). I would call that performance based.

-1, no link handed to you
+1, this was left out of article
+4, TRUE

Also, Neal let the phrase "just $550 million" in the summary, referencing 25% of the total internet radio revenue. Too much? Too little? "Just" is a blatant pejorative here.

Why allow overtly biased statements in such a stupid way? We expect more cunningness.

The irony is they are writing their death sentence

[bloosqr]

The *royalty* payments are only for RIAA/BMI/ASCAP/Harry Fox related artists and labels. All the labels in the indie scene and the labels are actually labels that are much bigger than you might think (though this excludes the fake indies or 'boutique labels') will give you - if you ask nicely - a blanket license not only to stream their music but to podcast it as well. Podcasting has serious licensing issues well beyond streaming internet radio but all of this is obviated if you are allowed to negotiate with the label or the copyright owner directly. Remember the RIAA/BMI/Harry Fox are acting on behalf of *their* labels, not music in general. They can not dictate what a label or an artist themselves say if the artist and the labels are not part of that agency.

To be clear, my show gets about 1500 listeners a week and industrial / new wave electro and here is a list of labels that have given permission:

http://www.bloosqr.com/the%20essence/the%20labels. html

*the irony* of these laws it is giving these labels much more exposure because by definition the indie/hipster/creative kids making their shows are now even more likely to only play music from the indie labels and more over anyone looking for internet music is more than likely to be exposed to music from these labels which given the distate for the "big 4" could easily turn some of these artists/labels into the next big thing

Oh, they can kiss my ass.

[rantingkitten]

As the operator of an internet radio station myself, my response is "kiss my ass". Like most other stations, I broadcast things that aren't ever going to be heard on conventional radio, giving (relatively) niche or obscure artists that much more free exposure. I know this works for two reasons:

1. I myself have bought albums after hearing certain artists' songs on other net radio stations -- music I would never, ever, ever have heard otherwise except perhaps in the drunken haze of a goth club.

2. Several independent artists have sent me singles and even entire albums, encouraging me to put them in rotation. To quote the latest, after he sent me a few samples and I liked 'em:

Thanks I appreciate the exposure, it's hard to get the music out as an
independent artist which is why I'm trying to get radioplay. The CD is
the mail.

This has happened several times. It's good for the artists who are trying to get noticed; it's good for the audience who gets to discover new music; it's good for the broadcaster cause it's just fun. I get permission from many of the labels or artists to play their stuff, and when I don't, well, it's a freaking 96k broadcast that can't be copied without some technical know-how (certainly much more difficult than jamming a tape into your radio and hitting "record"). Exactly who is being harmed here?

The RIAA's outmoded and antiquated business models, and their continued attempts to strangle the life out of emergent technologies, is absolutely appalling. I'll continue to broadcast from my host in Germany and here's a big screw you to the suits. I don't make a single cent off my broadcast, and I don't play the kind of music that would come close to competing with the mass-appeal fare on the normal airwaves. You'll never get a dime from me.