Are we looking at the end of Internet radio? (including Pandora)

[Equipoise]

@Sage Rat

Hm? You don’t think traditional radio pays royalties? What other royalty fees do you think it is that BMI and such collect?

If Pandora was already paying licensing for the songs based on an agreed upon rate, then I don’t see any legal way for the rate to be changed retroactively. So my guess would be that Pandora and others have been, for the most part, playing without paying.

As has already been noted, Pandora has been paying. All legit webcasters pay ASCAP and BMI fees, just like traditional radio, but only webcasters have to pay performance royalties, and they’ve been paying both fees all along.

This is from the Save Our Internet Radio FAQ:

So this applies to Internet stations only? Not FM?

Each piece of music has two copyrights attached to it. One is a copyright on the composition, which is owned by the songwriter or music publisher. The second is called the “performance copyright” and is owned by the recording artist or (much more likely) by the artist’s record company.

All radio stations - FM, Internet, satellite, etc - pay royalties to songwriters and/or music publishers through organizations like ASCAP and BMI. The amounts are more or less equal no matter how the song is broadcast.

Terrestrial broadcast stations (AM & FM) in the US pay no royalties to the owners of the performance copyright. Broadcasters have successfully argued for decades that the promotional value of airplay (i.e. the sales generated by radio airplay) more than adequately compensate the copyright holder.

However, in 1995 the lobbying arm of the record industry successfully convinced the US Congress that digital broadcasts were equivalent to providing a “perfect digital copy” of each song played to the listener, and therefore were another matter entirely, and that digital airplay of their copyrighted material would actually reduce, rather than spur, the sales of recorded music, since a large percentage of digital listeners would naturally save that “perfect digital copy” for their own use.

Therefore digital broadcasters (Internet, satellite, etc) should be liable for the payment of performance royalties, at a rate to be determined by the US Copyright Office.

Blame the @$*&!# DMCA (Digital Millennium Copyright Act of 1998). Here’s a brief but good overview of how this all happened.

@Sage Rat

Well it certainly sounds like a good case to take to court.

Lots of stations have filed petitions for a rehearing. National Public Radio, WXPN in Philadelphia, KCRW in Santa Monica, California, Pandora, Real Networks, even Clear Channel according to this page, and no doubt many many many many more. Yesterday was the deadline for filing. I haven’t yet seen a full list of those who filed a Motion for Rehearing, but I’m sure one will be forthcoming.

@treis

Why wouldn’t I just buy a cell phone with an am/fm receiver if I want to listen to the radio?

I don’t know, why wouldn’t you? Excuse me? What are you saying?

From that last link:

SoundExchange itself asked that the Board make clear that the royalties apply not only to Internet transmissions, but also to transmissions that may be received over a cell phone. SoundExchange contended that the Board’s decision was clearly meant to encompass such transmissions, but some language in the rules that were adopted appeared to raise questions about whether mobile phone transmissions were covered.

@Tuckerfan

Leo Laporte had a good idea for the internet stations, simply switch to carrying artists that aren’t signed to a label (or major label). That means the RIAA can’t do squat and unsigned artists get exposure. A win-win situation.

Artists need a central clearing house to sign up and let webcasters know that their music can be played. I’d be the first to sign up Happy Rhodes. Where did Laporte say this btw? I remember him from the old TechTV, but I haven’t seen him since it went off the air.

@Tuckerfan

That’s assuming that they can manage to survive having to pay retroactive royalties, of course.

That’s a damned good point. Many of them would fall just for that alone. Some could just refuse to pay, and make ??the CRB, the RIAA?? take them to court.

@Frylock

Its not computing with you does not compute with me.

You said:

However, I also realize that, at least ostensibly, music economics is what determines whether the music I am interested will reach my ears or not.

This would be true if you were a passive music listener who lets “music economics” determine what you listen to. There are so many ways to hear music nowadays (even beyond radio and webcasters) that your point makes no sense to me. Does not compute. “Music economics” hasn’t had anything to do with the music I’m interested in for a couple of decades. Well, the cost of recording and pressing CDs is a factor, but that has nothing to do with the music reaching my ears.

[treis]

@Equipoise

I don’t know, why wouldn’t you? Excuse me? What are you saying?

Why would I pay 6 bucks a month to get radio on my cell phone through a data network instead of buying a cell phone with an am/fm reciever.

[jovan]

@treis

Why would I pay 6 bucks a month to get radio on my cell phone through a data network instead of buying a cell phone with an am/fm reciever.

Because AM/FM radio sucks?

[Tuckerfan]

@Equipoise

Artists need a central clearing house to sign up and let webcasters know that their music can be played. I’d be the first to sign up Happy Rhodes. Where did Laporte say this btw? I remember him from the old TechTV, but I haven’t seen him since it went off the air.

He said it on one of his many podcasts. You can download them via iTunes or his website at twit.tv

[Frylock]

@Equipoise

You said:

This would be true if you were a passive music listener who lets “music economics” determine what you listen to. There are so many ways to hear music nowadays (even beyond radio and webcasters) that your point makes no sense to me. Does not compute. “Music economics” hasn’t had anything to do with the music I’m interested in for a couple of decades. Well, the cost of recording and pressing CDs is a factor, but that has nothing to do with the music reaching my ears.

Then you are using the word “economics” in a narrower sense than I am. This is fine.

-FrL-

[Critical1]

this may be the first time the U.S. government has passed a law forcing Americans to go out of the country (well connect to a stream from out of country) in order to get a product already provided by Americans by forcing the American companies out of business.

seriously imagine if they did this nonsense with Cars.
American car manufacturers must now pay out the arse for the right to sell a car in country

foreign car makers on the other hand can ship em over and sell them without any added fee
yeah right.
and profitable or not, this affects every single person who is hosting music over the web.
now think about that for a minute.

say I have the bandwidth just laying around. I start up a station and have a max number of listeners of say 4. one is the home pc, one is the entertainment pc, one is the lap top, and one is my work pc.
I only host music that I own in cd or other form.
why the hell should I have to pay anyone when I do this?
and how is this different than some guy hosting a small stream over the net that a few people listen to but is totally add free? especially if he takes the precautions to keep people from easily recording his stream?
net radio owns just about anything you can find over the airwaves (I do live in Seattle, home of KEXP and KMTT so I have a couple good choices. But the stuff I listen to online is found nowhere else, there is no equivelant radio station for me to switch to.
the riaa has been around since the 50’s or early 60’s and its sole purpose is to keep control in the hands of the labels. there is no other agenda that really matters. they just want to be able to limit what we hear because if we all listen to the same crap they sell more crap and its easier to make crap than interesting or unusual music.

[Baron_Greenback]

There may be some hope yet. Two Congressmen are introducing a bill - The Internet Radio Equality Act - which will reverse the copyright board decision.

Some details here.

[Gulo_gulo]

Savenetradio.org has information on what’s happening with Internet Radio Equality Act… It will also get you the contact information for your representative so you can call and ask him/her to support this bill. I’ve already received a vague response letter from my rep (from an earlier petition I sent him) so I think I’ll call him now.

[Tuckerfan]

Looks like the big guns are telling the RIAA to get bent.

Jonathon Potter is the Executive Director of the Digital Media Association which represents the six largest webcasters including AOL, Yahoo, Live 365, Pandora, Real Networks and MTV.

“The connection of the minimum fee to stream ripping is fantasmical. It’s doesn’t exist,” Potter says.

Potter blames the record industry, specifically its lobbying group, the Recording Industry Association of America, for trying to push webcasters to adopt the kinds of copy protection measures it has installed on CDs in an effort to prevent unauthorized file sharing.

“It’s something that the RIAA and Sound Exchange have decided: ‘Hey, we’ve got these guys, we got a gun to their heads. Perhaps we can box them in and force them to give us something that they have never been prepared to give us before’” Potter says. “And that would be a technological mandate to block stream ripping and we’re just not going to do that.”

[Jayrot]

Ballsy.

Awesome.