Slashdot Log In
Internet Radio's "Last Stand"
Posted by
kdawson
on Sat Aug 16, 2008 04:20 PM
from the see-i-told-you-there-was-a-wolf dept.
from the see-i-told-you-there-was-a-wolf dept.
We've been discussing the plight of Internet radio for some time, as the Copyright Royalty Board imposed royalties that industry observers predicted would prove lethal to the nascent industry. We discussed Web radio's day of silence in protest, which won the industry a reprieve, and the futile efforts to find relief in Congress. Now it's looking as if the last act is indeed close. Death Metal Maniac sends along this Washington Post story with extensive quotes from Pandora CEO Tim Westergren, who said: "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money... We're funded by venture capital. They're not going to chase a company whose business model has been broken." The article estimates that XM Satellite Radio will pay "about 1.6 cents per hour per listener when the new rates are fully adapted in 2010. By contrast, Web radio outlets will pay 2.91 cents per hour per listener." That's 70% of projected revenue for Pandora; smaller players estimate the hit at 100% to 300% of revenue.
Related Stories
[+]
New Royalty Rates Could Kill Internet Radio 273 comments
FlatCatInASlatVat writes "Kurt Hanson's Radio Internet Newsletter has an analysis of the new royalty rates for Internet Radio announced by the US Copyright Office. The decision is likely to put most internet radio stations out of business by making the cost of broadcasting much higher than revenues. From the article: 'The Copyright Royalty Board is rejecting all of the arguments made by Webcasters and instead adopting the "per play" rate proposal put forth by SoundExchange (a digital music fee collection body created by the RIAA)...[The] math suggests that the royalty rate decision — for the performance alone, not even including composers' royalties! — is in the in the ballpark of 100% or more of total revenues.'"
[+]
Internet Radio Will Go Silent on June 26th 250 comments
Spamicles writes "Thousands of U.S. webcasters plan to turn off the music and go silent this Tuesday, June 26th, to draw attention to an impending royalty rate increase that, if implemented, would lead to the virtual shutdown of this country's Internet radio industry. In March, the Copyright Royalty Board announced that it would raise royalties for Internet broadcasters, moving them from a per-song rate to a per-listener rate. The increase would be made retroactive to the beginning of 2006 and would double over the next five years. Internet radio sites would be charged per performance of a song. A "performance" is defined as the streaming of one song to one listener; thus a station that has an average audience of 500 listeners racks up 500 "performances" for each song it plays."
[+]
Net Radio Wins Partial Reprieve 96 comments
Joren writes "Just a few hours after our last discussion on this topic, Wired News is reporting that Internet radio broadcasters have won a temporary reprieve from the new rates. Apparently the details are still being worked out. 'A coalition of webcasters have worked out a deal with the recording industry that could temporarily stave off a portion of crippling net radio royalties set to take effect Sunday, according to people familiar with the negotiations ... For now, the parties involved in what's described as ongoing negotiations have agreed to waive at least temporarily the minimum charge of $6,000 per channel required under a scheme created by the Copyright Royalty Board, or CRB. The deal, brokered late Thursday, is not final and could change. One person involved in the talks described the situation as a reprieve, and said that internet radio won't be saved until a workable royalty rate is set.'"
[+]
Politics: Internet Radio's 'Second Chance' Bogging Down in House 105 comments
An anonymous reader writes "Wired is reporting that the Internet Radio Equality Act is failing fast in the House, with negotiations breaking down over fair pricing for internet radio broadcasters. 'A legislative setback could make it harder to dislodge the new fees, which took effect last month after a federal appeals court refused to postpone the payment deadline. With the threat of congressional backlash fading, SoundExchange could find little incentive to budge from its current position ... SoundExchange has already proposed changes that could relieve small and custom-streaming sites from charges they could not possibly afford to pay, at least in the short term. Many expect a small-webcaster deal to be done by early September, when Congress goes back into session. But the deal on the table hasn't changed since SoundExchange extended an offer in May to charge them 10 percent of gross revenue under $250,000, or 12 percent of gross revenues over $250,000, with a revenue cap at $1.25 million.'" All very cushy for SoundExchange. Wired also points out that this is the same organization illegally lobbying for terrestrial radio royalties through 'third party' shell groups.
[+]
Copyright Board Lawyer Responds On Pandora's End 103 comments
mattnyc99 writes "A month ago we talked about the impending death of streaming music site Pandora thanks to a very backwards fight over royalties. PopMech follows up with an article that, besides noting how insane it is that Pandora has to pay record labels for the bad songs that users skip, also gets the (three-member) Copyright Royalty Board to try and defend itself about why the government is determining royalty rates for the music industry. Quoting: 'It was uninvited,' says Richard Strasser, senior attorney for the Copyright Royalty Board. 'I don't think anybody was jumping up and down with joy in the government that they have this responsibility, but the former systems just weren't working out.'" No one seems to be trying to defend or explain why Internet radio is being hit so much harder than satellite or broadcast.
This discussion has been archived.
No new comments can be posted.
The Fine Print: The following comments are owned by whoever posted them. We are not responsible for them in any way.
Full
Abbreviated
Hidden
Loading... please wait.
The day the music died (Score:5, Funny)
(I have to pay $0.08 for every person reading this post because of the subject.)
Re:The day the music died (Score:5, Interesting)
Parent
Pirate Radio?? (Score:5, Interesting)
You know, it seems that we need to try to take lessons maybe from the Pirate Radio stations of the past and present that operate on the fringe, or in areas untouchable by the powers that be.
Too bad we can't do some kind of distributable P2P type application, that would allow anyone to run streaming music/video into the ether....but, is untraceable as to origin. Some type of freenet type thing for streaming content. That way, anyone could set up a Pirate Internet Radio Station (PIRS ?).
Is anything like this possible I wonder?
Parent
Re:Pirate Radio?? (Score:5, Insightful)
Parent
Re:Pirate Radio?? (Score:5, Interesting)
Yes, because at this moment it's not [fragmentmusic.net] possible [mono211.com] to create [thinner.cc] free music [uran97.com]. We totally need a network for that sort of stuff, which will also somehow solve the problem of Internet radio dying.
Parent
Re:The day the music died (Score:5, Insightful)
Now though... I work from home, I don't have a stereo with a radio in it. My only radio is internet radio. This is garbage. Ironically this will mean that RIAA and the like will be getting much less of my money. I'll be finding fewer bands whose music I like, buying fewer CDs as a result and they'll be getting no revenue from the Internet radio I listen to. I'm not sure what makes them think this is a good business choice.
Parent
What it comes down to is GREED! (Score:5, Insightful)
They also need an educational rate for colleges and schools and a non-commercial hobbiest rate for small 'bedroom' Internet stations
Re:What it comes down to is GREED! (Score:5, Insightful)
Parent
Re:What it comes down to is GREED! (Score:5, Informative)
Obvious solution -- broadcast from Venezuela. Chavez probably won't give a rip about the RIAA.
Parent
Re:What it comes down to is GREED! (Score:5, Funny)
Actually I have a buddy who broadcast using a server in Sweden, they don't care and if anyone busts in the bunker to get to the servers they explode, yeah they're hard core about server rights.
Parent
Even satellite radio can't survive at their rates! (Score:5, Informative)
Remember that Internet radio's rates are almost TWICE as high as satellite's. The only thing I can come up with is that SoundExchange WANTS to put Internet radio out of business for some reason-that's the reason they're setting rates as high as they are!
How many times can you shoot yourself in the foot (Score:5, Insightful)
I've been exposed to and promoted countless new bands that I never would have heard of on my own.
A small correction (Score:5, Informative)
*US based* internet radio's last stand...
Don't forget... In the free world US laws do not apply...
Re:A small correction (Score:5, Insightful)
Parent
Re:A small correction (Score:5, Informative)
Parent
Retarding progress of science and art again (Score:5, Interesting)
This is just yet another example of how the current copyright regime is prima facia unconstitutional.
To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries
Copyright is not a property right; copyright is an agreement between the public and authors & inventors creating a privilege [wikipedia.org] of limited exclusive right as incentive for dissemination of ideas because otherwise authors & inventors have only the choice of keeping their inventions secret or sharing them that the recipient does what he or she will with the information without limitation, which is the natural right [wikipedia.org] of the recipient.
Any mechanism of securing exclusive right to the author or inventor must meet two tests to be constitutional:
An attempt [nytimes.com] was made to test the absurdly long exclusive term against the "limited" requirement and that failed because any finite term is by definition limited.
The test that must now be made is against the requirement that copyright laws "promote the progress of science and the useful arts." The burden of proof should be on demonstrating that the laws do promote the progress of science and the useful arts because copyright is a limitation on the rights of the public and therefore intrinsically a burden on society. In granting copyright society temporarily yields their natural right to a privilege offered authors & inventors, a privilege that may be revoked at any time. [uchicago.edu]
Current copyright laws do not pass the test of promoting the progress of science and the useful arts; they are a burden on innovation and have systematically retarded the progress of science and technology, strangling many significant innovations, once again with internet radio. Current copyright laws are therefore unconstitutional.
Re:Extreme capitalism stiffles faster innovation (Score:5, Insightful)
Parent
Re:Extreme capitalism stiffles faster innovation (Score:5, Insightful)
When laws are passed that drive a company out of business because it's no longer economical to consume their product (internet radio), that really is the government and not the consumer's fault. When a transaction is taxed for more than anyone is willing to pay for it, it stops happening legally.
Parent
Exactly (Score:5, Insightful)
They'll claim that there will still be "radio" on the internet offered from regular radio stations. However, that is only a gimmick and advertising to promote another separate business (the original radio station), and means that an entire industry is being destroyed.
This move makes no sense other than to "test the waters" to see how far they can push business before they go bust.
Parent
Re:Extreme capitalism stiffles faster innovation (Score:5, Insightful)
What we see in the US is not capitalism, it is corpratism, an unholy alliance between large corporations and the government. This is why you see laws created to make more profit for large companies, and bail outs from the government to large companies who lose a substation amount of capital due to bad business practices.
If we had real capitalism in this country, even capitalism with regulated markets (you know, laws to live by, like every other Individual has to follow) we would have a lot more innovation and new industries would rise up over night because they do not have to contend with being killed in the crib by a new law passed to favor established markets.
Parent
The Dark Side of the Greed. (Score:5, Insightful)
Ah, that's the Dark Side of greed.
The Light Side of greed sparks innovation because folks have an incentive to make money by creating something new.
The Dark Side always goes after the weak: the ones that can't innovate. It promises easy money, high barriers to entry with laws and regulations, keeping the status quo. Some greed masters like Masters Jobs and Wozniak break into a field of greed. They, being great greed masters, broke IBM along with another, though maligned greed master, Gates. But even then, The Dark Side can even ake the best of us as it did Master Gates. He seams to be coming back to the Light Side with his charity work.
Pay heed young greed patiwan, the Dark Side is always there for the lazy!
Parent
Re:Royalty Pricing (Score:5, Funny)
Parent
This is the only way (Score:5, Insightful)
There is a point when trying to fight the society with it's own rules is futile.
Think about what this sick society orders you: You have to believe in stupid jesus, you can't smoke pot, you can't have privacy, you can't listen to music, Save on your energy use so the big industries can have more oil for them, You can't say shit on tv, blah blah blah!!!
B U L L S H I T.
Screw them, most of what we do daily to maintain some level of freedom in our lives is illegal. If you really abide by all the rules, pay all the taxes, and stick to stupid society's moral rules, YOU ARE NOT ALIVE, you become a Zombie.
I'll sniff, drink, believe, take, download, copy, share, do, read, write, think, say, modify, film and build WHATEVER THE FUCK I WANT.
Parent
Re:Royalty Pricing (Score:5, Informative)
You're confusing profit with revenue.
Profit is what is left over after you pay for servers and bandwidth and salaries and everything else.
Revenue is what you take in before you've payed for all of that.
The fees are hitting 70% of the REVENUE.
Parent
Re:What are they thinking? (Score:5, Insightful)
If your mom-and-pop just plays the song once, there's no revenue to the record label from that. No great public interest is created in the song or the artist. The CRB and record labels are driving the current internet radio stations out of business to open the market up for major companies like ClearChannel to spring up their own crop of internet radio sites. Only since they'll be run by a corporate giant, they'll be more controlled and regulated to the labels' liking.
Parent