Experimental Fees Settle Royalty War For Internet Radio 270
S-100 writes "SoundExchange has reached an agreement for royalty rates with a consortium of Internet radio broadcasters. The parties are ecstatic that the issue is finally resolved, and that the new rates are below the previous 'death to Internet radio' levels that had previously been imposed by the CARB. According to NewsFactor, Pandora founder Tim Westergren proclaims that 'the royalty crisis is over!', and other large broadcasters are equally pleased. One unheard-from group is less likely to be pleased: small Internet radio broadcasters. Buried in the details are a new minimum royalty payment: $25,000 per year. So say goodbye to all of the small Internet radio stations that you have been listening to, as they will no longer afford to operate legally."
Social corruption (Score:5, Insightful)
"Buried in the details are a new minimum royalty payment: $25,000 per year. So say goodbye to all of the small Internet radio stations that you have been listening to, as they will no longer afford to operate legally."
What about public domain music? (Score:4, Insightful)
goodbye to the small Internet radio station? (Score:5, Insightful)
Is this just in the US? (Score:3, Insightful)
Anyone Else Notice Pandora Lately? (Score:1, Insightful)
Pandora is starting to sound a lot like regular ClearChannel FM. Funny how that happens.
Re:Social corruption (Score:2, Insightful)
Re:What about public domain music? (Score:2, Insightful)
They don't need grounds. They can bankrupt you just by filing the suit and dragging out the proceedings.
Play new music, not corporate label rehash. (Score:5, Insightful)
Not only does this new deal not cover every country (the Internet has this global presence to it) but this new deal doesn't cover all music which is legally redistributable in the US. Support artists who aren't signing their copyrights away to the huge few corporate labels, support musicians who share with you under terms that allow you to share further, and you'll find there's a lot of good music out there to be enjoyed. Small radio stations would do well to stop trying to emulate the major radio stations and develop audiences that appreciate something different and new.
Re:$25K Adds Barrier of Entry to Control net Radio (Score:5, Insightful)
Re:What about public domain music? (Score:3, Insightful)
They don't need grounds. They can bankrupt you just by filing the suit and dragging out the proceedings.
They could do that against somebody who doesn't even run an Internet radio station. Heck, record labels have sued a network printer for copyright infringement. I'd still like to know how broadcasting Creative Commons licensed recordings of public domain musical works exposes me to more risk of being the victim of vexatious litigation than propagating any other Creative Commons licensed work.
Re:Are you crazy? (Score:4, Insightful)
Nobody makes music free, son.
SOMEONE stole it from my music empire.
Are you referring to the mathematical near-certainty that a song's hook will inevitably match that of at least one of the millions of songs in BMI and ASCAP's repertory? Or the precedent set in Bright Tunes Music v. Harrisongs Music that accidentally copying the hook of a song heard a half-decade ago is just as much a copyright infringement as what happens in the warez scene? Or both?
Re:$25,000 barrier to entry (Score:5, Insightful)
Why are we all so busy blaming Pandora for this?
IIRC, they were just trying to save themselves from getting annihilated by these preposterous fees... and now we're giving them a hard time because they didn't save every other tiny internet radio station all at once?
Seems to me that we won the battle, but not the war (yet). So let's celebrate that instead of flagellating those fighting on our side, yeah?
Re:What about public domain music? (Score:3, Insightful)
Because the other trade industries don't build on suing individuals?
Capitol v. Thomas identified specific works whose copyrights were willfully infringed. If I can control the playlist and document each work's license at least as well as Wikimedia Commons controls its own, my attorney could get the case thrown out at the "do you own the copyright in this recording?" step.
Re:Please show that CC licenses can be revoked (Score:5, Insightful)
I'd like to see how you think a WMG lawyer would defeat reliance on a CC license.
Simply by taking them to court you can crush a lot of small stations. When given the option of A) shutting down and WMG will waive the fee B) paying some sort of large (but not huge) fee like $5000 or C) being sued for $50000+. Most stations, especially those ran by individuals in their spare time would simply choose to shut down. The fee could cause a sharp increase in operating costs so the "ad free" station suddenly has more ads then terrestrial radio. If they go to court, they might keep operating for some time, but eventually the court costs could drain their operating costs budget to where they can't afford it. Even if the internet radio people win, they still lose.
Re:What about public domain music? (Score:5, Insightful)
It doesn't matter if you personally held the copyright to every single piece of audio played on your station. The RIAA will still insist you pay up (or at least file reams of paperwork that no small station can afford to file)
Re:Social corruption, or small-player boon? (Score:4, Insightful)
Yeah, except it hasn't happened yet and there's already been plenty of reasons to not listen to mainstream label music.
The main reason probably being that 99% of indie music really really sucks, and people don't want to have to look for that 1%.
Re:Social corruption, or small-player boon? (Score:5, Insightful)
I don't know if you've noticed, but 99% of commercial music sucks, too. It just has better marketing.
Re:Who cares about smaller internet radio stations (Score:3, Insightful)
Re:$25,000 barrier to entry (Score:4, Insightful)
According to NewsFactor, Pandora founder Tim Westergren proclaims that 'the royalty crisis is over, and we don't have to worry about any small competitors sneaking up and taking our business!'. I may have added that last part, but I'm sure he was thinking it. Like most regulations, it serves mainly to fuck small business and eliminate competition.
1. This isn't a regulation, it's a cartel whose licensing terms are enforced by [government]
2. And this $25K business sounds ripe for anti-trust investigation. How is it not abuse of a monopoly position?
Re:Social corruption (Score:5, Insightful)
This has nothing to do with Capitalism. The Market hasn't spoken, this is about copyright and royalties which is nothing but Government protection of works. Not saying copyright is a bad thing inherently (it is in a bad state if you ask me) but this is nothing but a barrier to entry into the internet radio business. This keeps out the small guy who isn't doing this for money (probably doing it at a loss out of his or her own pocket) and since it's compulsory someone running an internet radio station with just unsigned or independent music will still have to open their wallet to $25,000 a year. This is just a ploy by old media to keep broadcasting in their hands. It won't matter much to the more dedicated of the amateur broadcaster as they can most probably move their operation out of the United States.
Re:Social corruption, or small-player boon? (Score:3, Insightful)
It takes more than a beat to make good music.
Re:Who cares about smaller internet radio stations (Score:5, Insightful)
The point of traditional radio stations is to cover costs (and preferably make a profit) with revenue from advertisers by distributing their material to the populace. The populace generally isn't interested in listening to advertisements all day long, so the radio stations must provide material the populace is interested in, with advertisements thrown in periodically. Range "Y" is an artifact of radio broadcasting and power limitations imposed by the FCC to allow wider use of radio spectrum. I agree that the internet's nearly infinite supply of spectrum eliminates the need for any kind of range limitations. Genre "X" limitations are similarly a radio spectrum issue and need not exist on the internet.
Try turning that around: "What can the large one offer that the smaller one cannot if they are both free?" Really, I would expect a larger entity to develop into a far more bureaucratic system, making it slow to respond to listener's changing interests and requests. Further, large entities are somewhat resilient to legal action and more difficult to reconstruct, making them more easily controlled by external parties such as large copyright holders. Such legal action on a small entity would likely crush it, but a new one could quickly sprout up in the hole left by the original. Going back to the original question: "What can the small one offer that the larger cannot i they are both free?" Simply put, adaptability and resistance against external corruption. These qualities do not mesh well with the music industry's legacy business model, thus the attempt to eliminate them with a $25,000 minimum charge. I would be interested to see what kind of logical knots they try to tie in their attempts to defend this minimum.
Re:What about public domain music? (Score:3, Insightful)
I think that existing under a "no opt out" charter is grounds to have your charter revoked, under order that you rewrite it without that part, or it's completely forfeit.
Unfortunately (and fortunately for some) I'm not important.
Re:$25,000 is not much for small businesses (Score:4, Insightful)
For some cases you are obviously correct.
However in the case of the smaller stations this can be a daunting if not insurmountable price.
Consider, a station which plays primarily alternative music sources, but plays *one song* from the RIAA catalog, once, in a year. Still out $25k for that one song.
The pricing structure is clearly designed to exclude smaller and/or less mainstream stations.
Re:$25,000 barrier to entry (Score:4, Insightful)
According to NewsFactor, Pandora founder Tim Westergren proclaims that 'the royalty crisis is over, and we don't have to worry about any small competitors sneaking up and taking our business!'. I may have added that last part, but I'm sure he was thinking it. Like most regulations, it serves mainly to fuck small business and eliminate competition.
1. This isn't a regulation, it's a cartel whose licensing terms are enforced by [government]
2. And this $25K business sounds ripe for anti-trust investigation. How is it not abuse of a monopoly position?
That's easy.
Because many of the same people who were instrumental in putting this in place and that stand to gain from it also just happen to be the ones that would also be instrumental in deciding if it's fair or not.
Wagers on their decision?
Strat
Re:Please show that CC licenses can be revoked (Score:3, Insightful)
If they fail to do so (and they're likely to fail if they're suing on false pretenses), then they're the ones who end up paying your court costs.
And if I de of old age before they actually give up trying its a Pyrrhic victory. Just look at SCO vs IBM... if IBM were an individual person instead of the massive corporation it is, SCO would have one simply by wearing them down into insolvency.
Re:$25,000 barrier to entry (Score:3, Insightful)
I'm curious, why do you consider Pandora to be on *our* side? I haven't followed this situation closely, but it seems to me they've only done their best to stay afloat and nothing else. That's to be expected from any business, but it isn't something to be praised either.
Social corruption, only if you let them. (Score:3, Insightful)
Reason: Payola! (Score:4, Insightful)
I bet the only reason it got cheaper now, is because those "big" radios finally bought into Payola.
For $25,000 they now can play everything they want, as long as it's what the RIAA tells them to play.
Luckily, I and my Internet radios never cared, and never will!
Some of them are even illegal by government rules (like the idiotic UK laws), which makes them real analog "pirate" radios too!
But I either listen to them or to my mp3s. I could never go back to that pop shit that is "normal" radio stations. My musical knowledge of rare bands of the UK, Russia, Japan, UK, France, etc, grew massively since I listen to Internet radio. To me it's the second most important killer feature of the Internet. Right after porn!
Re:Social corruption, or small-player boon? (Score:2, Insightful)
Because the publisher, who actually paid you real money for the rights to your music, will contractuallly not agree to much if you retain the right to exclusively license to others. Instead, you'll just stay unknown.
The more you tighten your grip, Tarkin, (Score:3, Insightful)
Innovation is made possible by lowering barriers to entry, not raising them.
Re:Social corruption, only if you let them. (Score:5, Insightful)
Who says that an agreement between one set of parties binds others who were not party to the agreement?
Congress created copyright law, and by law a copyright holder can sue you in court for copyright infringement, and the courts will enforce it and if necessary bring in gun-toting police to enforce the authority of the court.
But then it gets more complicated. Congress passed a new law specifically to deal with "internet radio" webcasting. This law set up something called CARP - the Copyright Arbitration Royalty Panel - an the law authorized this panel to listen to industry lobbyists and set "reasonable" copyright payment rates for webcasters. The panel was directed to set the rates according to what willing-buyers and willing-sellers would agree to pay on their own under normal free market conditions. The payment rates set by this panel have the force of law.
What then happened is that the RIAA represents a multi-billion dollar industry with huge influence in Washington and with an army of lawyers and with an army of lobbyists and with effective monopoly power to dictate manipulative contract terms. The RIAA then made a deal with Yahoo (and maybe one or two others others) to license Yahoo to webcast the RIAA's copyrighted music. The RIAA manipulated this deal to inflate the apparent royalty rate. The RIAA then submitted this inflated rate to CARP, as evidence of the "natural free market price that willing-buyers and willing-sellers would reach on their own", and the RIAA used all their industry power and Washington influence to influence the CARP process. Webcasting - being brand new and mostly small upstarts and things like college radio - their interests had little or no representation before the CARP panel, and of course they got STOMPED. CARP set impossibly high royalty rates webcasters had to pay. It set impossibly high rates that would exterminate both small and large webcasting. Rates that effectively prohibited any sort of internet radio.
Webcasters, both large-and-small, found themselves faced with retroactive bills they would have to pay, bills far larger than than any money they had and larger than any gross-revenues coming in from webcasting. College radio and similar small and indie webcasters would get smacked with huge retroactive bills and shut down, and larger webcasters would literally have to file for bankruptcy. Webcasters large and small all screamed that the CARP set unfair and impossibly high rates, and they increasingly got their act together as an "interest group" to challenge the CARP ruling, and it appears they were going to be successful in having to reversed.
The RIAA then made a NEW deal with large webcasters. A deal that eliminated the impossibly high per-song-per-listener fee, and allowed them to pay according to a completely different and lower cost payment system While this was a "private contract", according to the CARP system other webcasters would also have the right to opt-in to those terms if they wanted to. The terms of this contract set a vastly higher minimum fee specifically to lock out smaller webcasters. The original CARP system had a $500 minimum payment for college radio and other indie webcasters (with per-song-per-listener fees going up from there), the new deal set a $25,000 dollar yearly minimum fee.
So the RIAA has effectively split the webcaster interest group that were fighting to get the CARP rates reversed. The RIAA gave the large webcasters a deal they could survive with, and effectively eliminated the "big muscle" on the webcaster side fighting the original CARP rates. College radio and other indie webcasters lose the little corporate support and legal support and Washington lobby influence they had. The small webcasters are unlikely to be able to effectively oppose the CARP ruling on their own, and will likely be exterminated.
So small webcasters are *not* bound by this particular agreement, but they are still bound by the CARP panel fees backed by the force of Congressional law. In fact small webcaster