Saturday, March 17, 2007

New royalty rates threaten small and large webcasters

[The following is the edited text of a recent letter to my congressional representatives]

Re: Save Internet Radio

As your constituent and an internet radio enthusiast, I was alarmed to learn that new music royalty rates were recently determined by the Copyright Royalty Board (CRB) which, if enacted, would certainly silence a great number of online listening services dedicated to webcasts.

I have run a small internet radio station using Live365.com (www.live365.com/stations/115599) for nearly seven years. Using a freeform format, I primarily broadcast independently recorded performances of unsigned or emerging artists from all genres of music.

The new royalty rate structure represents more than 100% of the total revenues for the majority of webcasters (Kurt Hanson, Radio and Internet Newsletter). As a hobbyist, I make NO money from my broadcasts. In fact, I pay a monthly fee to be able to do so.

My listener base is small (< 1,000 loyal listeners per month). The proposed changes would shut down my broadcast and many, if not all, of the other 368 freeform stations who currently broadcast on a purely NON-profit basis via Live365.

My situation is but one example. There are thousands of similar radio stations that would be forced out of the market. Sadly and by default, decisions regarding the music that people can hear would be made by a handful of media conglomerates whose motivation is profit. Internet broadcasting offers myriad choices and should not be singled out and penalized in sole deference to traditional, terrestrial radio stations.

This new ruling does not help the unsigned musician either since independent internet broadcasts are often the only place their music can be heard and appreciated on a recurring basis. Established artists and major record labels are the prime beneficiaries of the legislation.

I respectfully ask you to consider the following positions, hopefully adopt them as your own and persuade your fellow legislators to do the same:

1. Congress void the retroactive $500 per channel minimum that threatens to drive small webcasters out of business.

2. Congress reinstate the Small Webcaster Settlement Act. The CRB declared that the 2002 SWSA would not be extended despite the Small Webcaster contracts SoundExchange offered on its website and signed with Small Webcasters for 2006 and 2007.

3. Stop the retroactive, ex post facto royalty payments for 2006 mandated by the CRB, until all appeals have been heard (as the CRB rate decision is retroactive to January 1, 2006, please understand that time is of the essence).

4. Create a level playing field by bringing the Internet radio per performance rates into parity with traditional and satellite radio. Unlike internet radio, traditional radio does NOT pay royalties to record labels or artists for songs performed over the air.

The shuttering of the webcasting industry would be a loss for not only independent business owners and hobbyists, but also musical artists, copyright owners, and listeners who enjoy and support the wide variety of choices available via internet radio.

I thank you for your attention and consideration of these issues.

See also:

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