What we have here is a move by the recording industry, prompted by the XM / Sirius merger proposal, to squash independent online broadcasters who dare to play by their own rules. The RIAA wants to place impossible spin tracking requirements and charge exorbitant fees for the rights to play music -- moves that are not designed to recoup money from these online broadcasters, but instead crafted to severely limit the playing field.
Rep. Edward Markey (D-Mass.) had harsh words for a ruling released Tuesday by the U.S. Copyright Royalty Board. It proposes raising the amount that commercial Internet radio services pay to record companies by 30 percent retroactively to 2006 and in each of the next three years through 2009. Each station would have to hand over a minimum $500 royalty payment.
"This represents a body blow to many nascent Internet radio broadcasters and further exacerbates the marketplace imbalance between what different industries pay," Markey said at a hearing here titled "The Future of Radio". The hearing was convened by the House panel on telecommunications and the Internet, of which Markey is chairman. "It makes little sense to me for the smallest players to pay proportionately the largest royalty fee."
Under these rules, only internet broadcasters that can afford to pay the already-astronomical fees would be able to continue, and those that can't afford payments retroactive to 2006 find themselves in shit up to their necks. The $1.28-per-listener-per-hour rule being proposed here could completely shut down the internet operations of little guys like WCUR and WPRB, and even severely hamper the efforts of some bigger players like KEXP and Y-Rock on XPN.
To take WCUR for example, assume a rather meager 20 listener hours a day for 275 days out of the year (June, July, and August are typically pretty dead) -- that's $7,000 on top of the initial $500 fee. Seven grand is a solid one-third of that station's budget, and could probably force their hand to either turn off their internet simulcast or to (gasp!) start advertising on their online stream to make up for their lost revenue. And, if the station's listener base grows, the problem grows in proportion as well: if WCUR ever gets so popular as to have just 50 listener hours a day, these fees will suck them completely dry.
Of course, we're using the WCUR example because it's the one we're intimately familiar with -- but we know the world probably won't miss it when another shitty college station that plays pro wrestling entrance music as the majority of it's format gets canned. The stations that truly care about the music enough to dedicate their time and effort to providing quality alternatives to the homogenized muck that's out there now will certainly all perish. This bill has the power to single-handedly destroy the most promising radio medium since FM went mainstream -- and the best way to stop it, it would seem, would be to contact the guy we already know is on our side, Rep. Ed Markey, and voice your support for his actions against this crap.
Link via [CNET & Open Congress]
