Internet Radio In Danger of Extinction in United States

An anonymous reader passed us a link to a Forbes article discussing dire news for fans of Internet radio. Yesterday afternoon saw online broadcasters, everyone from giants like Clear Channel and National Public Radio to small-fry internet concerns, arguing their case before the Copyright Royalty Board (CRB). The CRB's March 2nd decision to increase the fees associated with online music broadcasting will have harsh repercussions for those who engage in the activity, the panel was told. "Under a previous arrangement, which expired at the end of 2005, broadcasters and online companies such as Yahoo Inc. and Time Warner Inc.'s AOL unit could pay royalties based on estimates of how many songs were played over a given period of time, or a 'tuning hour,' as opposed to counting every single song ... [They] also asked the judges to clarify a $500 annual fee per broadcasting channel, saying that with some online companies offering many thousands of listening options, counting each one as a separate channel could lead to huge fees for online broadcasters." There was also a previous provision for smaller companies that allowed them to pay less, something the March 2 decision did away with; in the view of the royalty holders, advertising more than pays for these fees, and they're ready for higher payments.

Classic Radio

[jshriverWVU]

Does this apply even to stations that run regular Radio over the airwaves? You'd think they wouldnt have to double pay since they already pay royalties for the initial broadcast. Using the internet as a form of delivery I would think would be no different than using a repeater to extend range and "rebroadcast". *shrug* definately sucks, but I'll stick with japan-a-radio :)

Outsourcing?

[spyrochaete]

What about offshore servers? Are you still liable to pay royalties if you're "broadcasting" from Israel or Sweden? Technically you'd be unicasting to your server, not broadcasting to an audience.

Re:Well it had to happen sometime

[Anonymous Coward]

You couldn't expect them to let people broadcast music for no fee forever.

Except internet broadcasters have been paying fees. The difference is that the new rules make the fees higher for internet radio stations than for terrestrial radio stations.

Should mimic broadcast radio

[Anonymous Coward]

Internet radio should be handled the same way broadcast radio is. The record labels pay the radio stations to play what they want them to.

What's To Stop International Broadcasts?

[Anonymous Coward]

How is this going to affect streaming radio from other countries? What are they going to do to stop me from listening to a radio stream that doesn't pay any fees being broadcast from say...The Cayman Islands? How long till the U.S. Government starts actively blocking data entering the country much like China?

Profit?

[SCHecklerX]

Don't most Internet-Radio stations make no profit? You'd think artists would be thrilled to get the publicity. If they do make a profit off of the songs themselves, then pay them. But I don't think that is the case. Even traditional stations have to use paid advertising. Right?

Royalties for broadcasting over public airwaves, or on the Internet are a really dumb idea. The artist already got paid with the CD sale. The artist gets 'free' advertising.

Go on tour and make your money. Use CDs as promotional material.

Re:As the adage says, if you outlaw Internet Radio

[Anonymous Coward]

Thank god mine are slowly returning to indie labels...there are moments where it is good to be a fan of Ska and punk (and I am talking real punk).

Re:ditch corporate music

[l0rd]

While I agree with you that people will not conciously try to avoid supporting the RIAA, they still stick it to the man every time they download an mp3 over their favourite p2p network.

Until music is sold without DRM in mp3/flac form for reasonable prices people will continue to download and nobody will buy cds. Unfortunatley (for them) RIAA & friends dont want to sell mp3/flacs without DRM. Therefore they are digging their own graves a little more every day.

One day even these dinosaurs will have to face reality and see that they are no longer needed in their current form and they grow less powerful everyday. Just as a meteor one day killed all the dinosaurs and made way for man, so will p2p smite the record companies and finally free the independant artist from their evil chains (please excuse the dramatism ;) )

Re:Well it had to happen sometime

[CastrTroy]

Maybe this is because they figured they could actually charge per person listening, which is the most fair way to charge when you think of it. With traditional radio, it is impossible to tell how many people are listening at any one time. With internet radio, it's extremely easy to tell how many people are listening, as least in terms of number of computers tuned in. Maybe the internet radio will just have to start putting on commercials like the FM stations do. Sure it makes the radio suck more, but somebody has to pay for the music.

Potential audience size is meaningless

[Anonymous Coward]

Shouldn't they be paying more if they have a larger potential audience?

No, else by your logic, any song played on shortwave radio would have to account for a potential audience of 6+ billion people.

Re:Denial, RIAA style-sideline story

[speedlaw]

Many years ago, as a student rep at Boston U, we though about hiring a popular band for one of our student affairs. We were advised by several band managers that even tho we could afford the band (s) they would not play our, or any school. The reason was that if you played schools, the concert promoters (Boston, 1979-1983) would not hire you to play the big venues. This suddenly explained why once a band broke, you could never see them anywhere but the big arena. I agree that copy right holders are entitled to be paid for their work. What is happening here is more monopoly strongarming than copyright protection. The internet is the single greatest thing to happen to content since Gutenberg. Recall that prior to him, reading was kept to the Church and King...only elites could read...and they liked it that way.

Re:Outsourcing?

[Anonymous Coward]

Not really a fix - if the business itself is a US business entity, it doesn't matter where the servers are.

Now, offshore business entities ... another matter. Although they'd still probably be taken to task by their own jurisdictions.

Re:ditch corporate music

[Billosaur]

David Byrne [nytimes.com] agrees with you -- he believes that thanks to the Internet, artists don't need the music labels as much anymore, which means if the RIAA wants to stick around, it better find a way to adapt to the times.

Annoying, yes. A problem, no.

[Anonymous Coward]

Let's get real. What this will do is force Internet radio stations to begin chargin subscription fees and limiting the rate at which you switch between songs. Using the numbers supplied by RAIN where the average Internet radio station serves 16 songs per hour at a rate of $.0008 per song. One hour equals 1.28 cents. If you listen for 40 hours a week all month long that's $2.05 USD. If you were listing 24/7 for the whole month that would be $9.52 USD/month. So going back to a 40 hour week, if the station charged you a monthly subscription of $5 a month, most of that would be profit. They'd be able to completely do away with ad revenue, a huge benefit over normal radio, and offer a free 1 week trial to new users. It would be annoying all right, but most people can afford that.

Re:This is what the US needs

[wandazulu]

Sadly, while I agree with you, I have a friend who I use as the "Joe Sixpack" acid test, and the only thing he wants to change is the price of the PS3. He uses Internet radio to stream the same classic rock songs from the local radio station, and when told it could be shut down, his response is to say "whatever...I'll just go back to listening to the radio."

The thing that galls me the most is that he has absolutely no concern about America's place in the world. To him, America *is* the world. His rationale? We've got every type of climate and terrain, somebody from every country in the world, and "all the brains to last my lifetime" (his words). He has no kids so he doesn't give a flying fig about the future more than the next release of GTA.

I get the impression there are a lot of these people about.

Re:ditch corporate music

[Maxo-Texas]

It depends on the band.
What you are saying is true for bands from large music companies.

OTH, a regional band in my area named Blue October's CD's are almost like a compilation of greatest hits. Maybe it's because they are still fresh/young and have something to say. I know they love their music enough for the lead singer to come out on a broken leg to sing despite being in obvious pain.

It's tough- I was exposed to them through copies of their music ( a friend wanted me to go to a concert so burned me a CD). Then I went to the concert (k-ching) and later bought a couple T-Shirts online (k-ching, k-ching). Without piracy, I'd have never become a fan.

Actually i think you're right- they are more releasing quality only and not rushing to produce filler. So they are really in the mode you are suggesting we should be in.

It's a shame for the "one hit wonders".

I don't see any point in the huge cut RIAA takes and a trivial search reveals sites saying how with a million records sold AND a concert tour, some bands still OWE money to the industry. That's just not right. That's downright evil.

Re:It will sort itself out...

[Overzeetop]

You didn't read the ruling, did you?

I read it, and the panel that awarded the fees basically took the content industries' recommendations for the new fee structure verbatim, with only one exception (they also wanted a 25% add-on to the fee for any broadcast terminating at a mobile device). It's like two people going to a required mediator, and one party asking for $1000, and the other suggesting that they can afford $50, and the judge saying "$1000 sounds good to me!"