Net Radio Appeal On Royalties Rejected

Station writes "The Copyright Royalty Board has rejected a request to reconsider its March decision to impose an onerous royalty schedule on Internet radio broadcasters. '"None of the moving parties have [sic] made a sufficient showing of new evidence or clear error or manifest injustice that would warrant rehearing," wrote the CRB in its decision.' The recording industry and its royalty collection organization SoundExchange are jubilant over the ruling. '"Our artists and labels look forward to working with the Internet radio industry — large and small, commercial and noncommercial — so that together we can ensure it succeeds as a place where great music is available to music lovers of all genres," said SoundExchange head Simson in a statement. Noble words, but after today's ruling — which will take effect on May 15 unless the US Court of Appeals for the District of Columbia Circuit agrees to hear an appeal — there probably won't be much of an Internet radio industry left for SoundExchange to work with.'"

Comments

Decision only sets compulsory rates

[The Empiricist]

Copyright owners and webcasters can still negotiate rates (See 17 U.S.C. Sec. 114(f)(3)). The decision that the Copyright Review Board refused to rehear merely establishes the terms and conditions that enable webcasters to license copyrighted works without seeking permission from the copyright owners. If Congress had not enabled the establishment of these compulsory license rates, then webcasters would not be able to broadcast any works without seeking permission from copyright owners because Congress had introduced a digital performance right in the Digital Performance Right in Sound Recordings Act of 1995.

Copyright owners presumably are interested in maximizing their revenues, while webcasters probably would like to minimize their costs. Thus, both groups still have a incentives to negotiate. The compulsory licensing rates will not kill internet radio: they simply provide terms and conditions of last resort for copyright owners and webcasters who cannot otherwise reach an agreement.

Re:Royalty

[Bobzibub]

http://www.peercast.org/features.php
Anonymous broadcasting - clients do not tell each other if they are the source or just listening

An Alternative Scheme

[Reziac]

So what's needed is a *different* agency, to collectively negotiate rights for non-SoundExchange artists.

It occurs to me that an outfit like CDBaby, already set up to pay artists for CDs sold, might serve quite well as a royalties broker for independent artists and songwriters (remember there are two parts to that side of the equation).

Once the base rate has been set (and it could be instantly defined as "just like it was before the new rules") it would be a matter of getting the word out, letting artists trickle in on their own, and creating a central database of music covered by the new "indie royalties agreement". The new royalties agency would take a cut (doubtless much smaller than what the current regime takes -- is it 80%?? anyone know for sure?), and distribute the artists' portions in the same way as they currently distribute artists' portions of CDs sold.

In fact, this could extend to any outfit that's set up for it -- the only hard requirement is that everyone must use the same central database, so all the internet radio stations can know positively, in one step and without having to chase anyone around, what music is covered by the indie-royalties-agreement and therefore free of the usorious new cartel rates.

I did find it interesting that even Clear Channel is on our side -- they're probably the ONLY radio voice loud enough to be heard in Congress. Goes to show that even as entrenched in realspace radio as they are, even Clear Channel recognises that the internet is the future of radio broadcasting -- particularly as station equipment ages out and they find it vastly cheaper to replace transmitters and towers with MP3s and bandwidth.

Re:An Alternative Scheme

[cfulmer]

This is a great idea.

It seems to me, however, that the entire premise behind flat-rate royalties is slowly disintegrating. The original idea was that it's too difficult for each station to contract with each rights-holder. So, a flat rate was set which, while not perfect, at least allowed those transactions to go through. The songs that are played are sampled, and then the royalties are divided among the rights holders according to the sample.

But, on the Internet, why can't you just have a big database tracking every song? The head-end software looks at how many listeners there are, looks up the song in the database and reports to the station "If you want to play this song right now, it will cost you $$$$"? Then, when it gets played, it tracks exactly who is supposed to get what royalties.

This model has a number of benefits: first, it's more accurate: each rights holder gets paid when their music is played. Even the guy whose song is only played to twelve people will get compensated, whereas he never would have made that 'sample' before. And, second, it allows each individual artist to set the rates for their own music -- if you want to give your music out for free, do it. And, third, it would allow low-cost Internet radio to thrive.