Radio and Internet Newsletter reports
SoundExchange and the National Association of Broadcasters (NAB) have reached an agreement on webcast royalties for commercial broadcasters’ simulcast and Internet-only online streams.
NAB members get a discount for 2009-10 on rates previously announced by the Copyright Review Board. Rates increase @ 10% a year thereafter.
Some background: The NAB represents traditional over-the-air commercial radio stations. Increasingly they offer internet streams as well. NAB have opposed attempts to introduce royalty payments for broadcasting music (such as we have in the UK).
The March 2007 CRB ruling gave FM radio and Sirius XM lower royalty rates than internet radio.
No news yet on Small Commercial Webcasters or Digital Media Association (DIMA) whose members include Yahoo, Real networks, Live 365 and Pandora.
Save Net Radio reports today
“Legislation authorizing SoundExchange to negotiate royalty agreements with webcasters on behalf of copyright owners and performers before the end of the year has been approved by the U.S. Senate. The Webcaster Settlement Act of 2008 (H.R. 7084), passed unanimously in the House of Representatives earlier this week, was approved by the Senate yesterday evening and now awaits President Bush’s signature.”
The Act offers a likely solution for webcasters, whose industry has been under threat since the March 2007 decision by the Copyright Royalty Board (CRB) to massively increase royalty rates payable by internet broadcasters. Campaigns in support of netradio, appeals and proposed alternative legislation had run into stalemate, until recent moves by larger webcasters and royalties-collection agency SoundExchange towards a negotiated settlement. The Act allows SoundExchange to make agreements, which will have legal status, with webcasters on behalf of copyright holders.
It’s not yet a deal. Different sections of the industry- DIMA, small webcasters, NPR- have to arrive at settlements.
David Oxenford, whose Broadcast Law Blog is an invaluable source of legal opinion on US media, has written extensively on the Internet Royalty dispute and represented small webcasters. He explains What the Act Means
Interview with John Simson, head of SoundExchange, the US organisation responsible for collecting royalties for music performed via non-terrestrial radio (web, satellite) and distributing those royalties to artists.
Context: in the US terrestrial radio broadcasters over AM and FM pay nothing in performance royalties (unlike the UK). Satellite radio stations XM and Sirius pay a percentage of revenue at about 6 or 7%. (Digital radio, via satellite. A different technology than DAB in Europe) Wikipedia: Satellite radio
SoundExchange reject a percentage of revenue model for webcasters and, following the CRB ruling, are seeking per-track revenues at rates which will put many webcasters out of business. Pandora would pay 70% of revenue. Previous coverage on this blog here. For others, royalty costs would exceed their revenues.
John Simson interview: webcasting and the future of radio
Video, 11 minutes
SoundExchange vs internet radio
“We’re approaching a pull-the-plug kind of decision,” says Tim Westergren, founder of Pandora
“We’re funded by venture capital,” he said. “They’re not going to chase a company whose business model has been broken. So if it doesn’t feel like its headed towards a solution, we’re done.”
The article also provides a comparison of the differing royalty rates for traditional broadcasters and webcasters in the US. Webcasters pay more.
Giant of Internet Radio Nears Its ‘Last Stand’