The Web Radio Debate Continues
When it comes to Internet radio, everyone agrees on one point - the idea has grown quite a bit in recent years.
An estimated 52 million people listened to Internet radio at least once a month in 2006 and it's predicted that that number will double within three years and reach nearly 200 million by 2020.
But could that growth have been halted by a March decision by theCopyright Royalty Board, an arm of the Library of Congress, increasing the royalties Webcasters need to artists and record labels? Small webcasters - hobbyists who use services such as Live 365 - immediately cried foul and said the types of fees they'd be forced to pay would basically silence them. They have argued that many of them make no money and that they are doing artists a favor by exposing their songs to a growing audience of people who turn to the Web to discover new music. Opponents say that only the very rich will be able to broadcast on the Web if the fees, which are scheudled to go into effect on July 15, are upheld.
Proponents of the fees say that the very rich - in the form of big companies who are broadcasting over the Web - are already getting richer by not paying artists and labels their fair share.
Now, members of Congress are proposing legislation that would vacate the Copyright Royalty Board's decision. Yesterday. Senators Ron Wyden (D-Ore.) and Sam Brownback (R-Kan.) introduced companion legislation to a House bill recently introduced by Representatives Jay Inslee (D-Wash.) and Don Manzullo (R-Ill.) that basically calls for a reconsideration of the fee structure. They note that, for large Webcasters, the royalty increase could be between 40 percent and 70 percent of revenues. For small Webcasters the royalty increase could reach up to 1,200 percent of revenues.
John Simson, executive director of SoundExchange, which collects and distributes royalties on behalf of the recording industry, argued in a Viewpoint piece on businessweek.com today that performers and record labels deserve to fair and reasonable compensation when their music is played on Web radio stations, as well as satellite radio and cable audio music channels.
In a statement, Sen. Wyden said the bill is standing up for the small Webcasters and innovative startups. "Keeping Internet radio alive is part of a broader issue that is important to me -- keeping the e-commerce engine running by preventing discrimination against it," he said.
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