Internet Radio Must Pay
Traditional airwave radio does not pay royalties for music that they play on their shows. There is a special exemption in the copyright law for radio play. When internet radio stations came into being, it was determined that they do not qualify for the exemption and they must pay royalties for the music they play. The latest battle over how much the royalty would be ended with a steep increase in the amount. The stations requested a rehearing, and there was some optimism that they would get one. However, today the Copyright Royalty Board denied the request, leaving the sharply steeper royalty rates in effect, and causing many internet stations, including traditional stations that simulcast over the internet, to predict their own demise.
The legal difference between air radio and internet radio is based on the science behind the broadcasts. This makes no sense to me whatsoever. People use air radio and internet radio in similar ways. Internet radio has simply opened up the competition for listeners, giving those listeners vastly more choices. Increasing the number of choices available is especially critical as regulation of air radio has resulted in the consolidation of thousands of stations into single “networks” that control the vast majority of what is broadcast in the US. Air radio was exempted from royalties ostensibly because radio play for music was a useful promotional tool for the owners of the music, essentially an advertisement for sales of their recordings. The same can be said of internet radio, so the only smart thing to do is to treat air and internet the same for royalty purposes. Either eliminate royalties for internet radio, or require air radio to pay the same royalties.
May 2nd, 2007 at 8:44 am
[...] Internet Radio Debate Continues May 2nd, 2007 by Pamela Parker A great outcry followed a ruling by the Copyright Royalty Board that significantly raised royalty rates for internet radio boradcasters. Refresh your memory on the story and the ruling here. Congress will consider legislation that would alter the new royalty rate and bring it closer to the royalty rates paid by satellite boradcasters. [...]