Save Internet Radio (A wordpress blog)

If the RIAA and SoundExchange get their way, independent webcasting / Internet radio will soon cease to exist.

Why? Earlier today, the Copyright Royalty Board, the group overseeing statutory licensing for US-based internet radio stations, announced the new royalty rates for streaming radio performance rights. The board rejected the arguments made by webcasters and instead chose to adopt the proposal put forth by industry-backed SoundExchange, a royalty fee collection agency created by the RIAA.

The new rates are based on “performances” of songs. A “performance” is defined as one song being streamed to a single listener. In other words, a station with 1000 listeners is charged for 1000 performances of each song it broadcasts.

Further, the new rates, just announced today, are retroactive to 2006, and increase rapidly each year. The rates per performance are as follows:

$0.0008 in 2006
$0.0011 in 2007
$0.0014 in 2008
$0.0018 in 2009

At first glance, those seem like fairly small numbers: eight ten-thousandths of a dollar, eleven ten-thousandths of a dollar, and so on. When you actually do the math, however, you see the truth revealed. The average radio station plays 16 songs in an hour. Under this system, that would be equivalent to 16 performances.

0.0011 x 16 = 0.0176

Still a fairly small number - under two cents. But now assume this station has 1000 listeners. That means that, in one hour, the station would be billed for 16,000 performances.

0.0011 x 16000 = 17.60

That’s $17.60 an hour. Now we’re starting to see how expensive this truly is. Multiply that by 24 hours a day.

17.60 * 24 = 422.40

$422.40 a day. But there’s 365 days in a year.

422.40 * 365 = 154176

$154,176 for the year in performance royalties alone for a station with 1000 listeners. And that’s just for 2007: it gets even worse. In 2008, the cost rises to $193,536 for the year. In 2009, it goes up to $248,832. Even for a much smaller station, the royalties owed are huge.

Of course, these figures don’t include the other set of rights that Internet radio stations are required to purchase, which must be licensed separately from an agency like SESAC or ASCAP, or the cost of bandwidth and server capacity. When you add all these costs together, you can easily see why nobody, save perhaps a megacorporation like AOL or Yahoo, could afford to pay these rates.

But wait - what’s this? The new rates apply retroactively to the beginning of 2006. In other words, someone who has been happily (and legally) running their small internet radio station for the past few years is suddenly going to be hit with possibly hundreds of thousands of dollars in additional royalties owed. These bills could easily cause a small, independent broadcaster (and his family) to go bankrupt.

Meanwhile, over-the-air radio stations are still not required to pay one dime to the record industry for public performance rights from SoundExchange or an equivalent group. They only need to pay the far more reasonable fees of BMI, ASCAP, and/or SESAC. This reads like another tactic by the recording industry and corporate powers to exert control over anyone involved with music and an attempt to destroy independent broadcasting.

Whether you don’t want to see your favorite internet radio station go off the air, whether you just hate the RIAA, whatever the reason: please, help us get this senseless, greedy policy designed to do nothing but line the pockets of the record industry overturned. Write to, or better yet call, your representative, your senators, and the Copyright Royalty Board. Tell your friends and family, write on your blog, digg this - help get the word out and help to Save Internet Radio!

If you are a webcaster, we want to hear from you! How will this affect your station? What do you plan on doing? Drop us a line at feedback@save-internet-radio.com. If you’re someone involved with setting these rates, you’re also welcome to contact us and explain why you think these rates are fair.

We’ll be updating this site with more information as this progresses, so please check back and get involved!

Whatever music business the RIAA can control, they will want to take unfair advantage.

Until people finally begin to see the pattern of that principle and demand justice, the oppression will continue.

people = the general public at large

This royalty rate only applies to RIAA music, as they were the only party to the negotiations.

Stop playing RIAA music and that quarter-million dollar expense disappears. Take a small fraction of that and spend it to pay someone to wade through the indie stuff and find the jewels.

Webcasters need to review the history of radio, paying special attention to 1940. It is the webcasters' choice what music they offer. No one is forcing them to play RIAA tunes, so whining about how expensive it is seems childish.

Make a different choice.

In other words: If you aren't the likes of Clear Channel or some other megacorporation with deep pockets, we don't want you.

Just another sad sign that there are already a very few people controlling what we see and hear. George Orwell's 1984 was only 23 years late.

Anyone remember that song by Spirit called 1984? Looks like it is finally arriving!

There is only one way to resolve this.

Don't deal with ASCAP, BMI or SESAC.

Set up a royalty entitlement procedure whereby the artists (and only the artists) get paid for the songs that internet radio stations play. If the artists want their money, they must apply for it with the station that is playing their songs, afterwhich they (the artists) will directly receive a check one every three months with the roylaties owed to them. The going rate should be 75 cents per song each time is is played. This will save the stations approximately 80 to 90 percent of the expense that would have normally been paid to the bigger organizations.

Any thoughts? Please post them here.

Hi MrDude,

(You ain't heard the half of it.)

To those of you saying don't play RIAA music or boycott ASCAP, BMI and SESAC.

Doing so effectively eliminates anything you might want to play.

The list of record companies that are members of the RIAA is here:
http://www.riaa.com/about/members/

Just looking quickly at that list includes all music owned by: A&M, Arista, Asylum, Atlantic, BMG, Capitol, Chrysalis, Columbia, Decca, Denon, Elektra, EMI, Epic, Eureka, Geffen, MCA, Mercury, Motown, Polydor, RCA, Rhino, Rounder, Rykodisc, Sony, Time/Life, Time/Warner, Warner Bros.... and about a 1000 more record companies.

So exactly how do you NOT play a RIAA recording? Since RIAA stands for the Recording Industry Association of America (RIAA) and since the RIAA members create, manufacture and/or distribute approximately 90% of all legitimate sound recordings produced and sold in the United States.

As far as not dealing with BMI, ASCAP, and SESAC - that's an entirely different animal, bypassing them does not do anything but hurt the Artists. This fee isn't a licensing fee paid top the artists via BMI, ASCAP or SESAC, etc.

Those fee's are now paid, and would be continued to be paid, that is how the artists make some money (although the record companies do find a way to get their fingers into that also)

This fee is an Additional fee on top of the licensing fees by the RIAA.

I understand you saying deal with the artists directly, but then you would have to ask, ok whose going to make (as in actually pressing and distributing) the records? Do you really think the record companies are going to allow anyone to deal directly with the artists? Especially since the artists in a standard record contract don't really own the music, the record company owns the music... the artist gets a royalty for writing the songs.

In 2000, a bill was passed that defined recorded music as "works for hire" under the 1978 Copyright Act. It was an amendment added to the original 1978 bill.

Under the 1978 Copyright Act, artists could reclaim the copyrights on their work after 35 years. If you wrote and recorded "Everybody Hurts," you at least got it back to as a family legacy after 35 years. But now, because of this amendment, "Everybody Hurts" never gets returned to your family, and can now be sold to the highest bidder.

In addition, since the artist is now considered a work for hire, the record companies can also own the group’s name, for let's say a web site. The Goo Goo Dolls were struggling to gain control of their domain name from Warner Bros., who claims they own the name because they set up a promotional Web site for the band.

(I do not know what the result of that was.)

Somewhere along the way, record companies figured out that it's a lot more profitable to control the distribution system than it is to nurture artists

And that is effectively what is happening here

" To those of you saying don't play RIAA music or boycott ASCAP, BMI and SESAC.

Doing so effectively eliminates anything you might want to play. "

Bullshit.
It eliminates the flavor of the month being foisted on you.

" So exactly how do you NOT play a RIAA recording? Since RIAA stands for the Recording Industry Association of America (RIAA) and since the RIAA members create, manufacture and/or distribute approximately 90% of all legitimate sound recordings produced and sold in the United States. "

Bullshit.
The true independents ( you know, the ones not signed to any RIAA member label ) are outselling the mislabeled RIAA .. hoe much of the RIAA is actually american owned ?
Now, please ...
define 'legitimate' for me
What is an 'illegitimate' artist ?
Does legitimacy come from being indentured ?

" As far as not dealing with BMI, ASCAP, and SESAC - that's an entirely different animal, bypassing them does not do anything but hurt the Artists. This fee isn't a licensing fee paid top the artists via BMI, ASCAP or SESAC, etc. "

Bullshit.
Bypass these and pay the artist directly.
These agencies go out of their way to avoid paying artists.

" I understand you saying deal with the artists directly, but then you would have to ask, ok whose going to make (as in actually pressing and distributing) the records? "

Make 'em yourself.
Pressing and distributing are moot ( intertubes, ya know ). that's what this really is about.

" Somewhere along the way, record companies figured out that it's a lot more profitable to control the distribution system than it is to nurture artists

And that is effectively what is happening here "

THAT you got right.
Control is the only issue.

Excuse the term 'legitimate', that was an RIAA word, not mine. MY bad, I should have rephrased their wording when posting my first post.

I agree that there are lot's of independent lables, one can take advantage of, but that doesn't solve the problem... All music should be available to play.

Yes one can press there own, but does the average band or musician have the capability or funds to do so. - In a small scale I'd say yes, in large scale, I am guessing that they don't.

Now it's been a while since I was in the recording end of the industry, but at the time I had a release of an album (before cd's) it was out of the reach of most musicians and bands. Maybe that's changed. since cd's are cheap cost wise.

But I believe that on a large scale duplication process and distribution the average grassroots band is going to find it very difficult.

What I do see as a possibility is an organization emerging that directly competes with the RIAA coming up that does not impose these fee's.

And I agree the licensing agenies do go out of the way to avoid paying the musicians and artists, but again, that's a seperate issue.

And while there are alternatives you suggest. Are they practical alternatives on a large scale? I don't think so, so I guess we disagree there.

I wonder if there is a place where many Independent artists post their work.
If there WERE such a place then perhaps that place could run a streaming internet station of their own, featuring all of the independent artists that call that place home.

That could be pretty awsome.

I know mp3.com has a lot of indies on there site and I just learned today there is a competeing company for RIAA, called Merlin, which is suppose to cater to indie's -- I don't know how many people know about them, but I like that direction