For anyone short on time, here’s the summary of one of the largest threats to internet radio to date:
- The copyright board ruled to triple fees paid to record labels for streaming internet radio over the next three years.
- Payments are now computed on a “per play” basis.
- The fine print includes a “per station minimum”, with no maximum.
- The above rate would be computed retroactively. One such company after the new law goes into effect, would owe the record labels $600,000 for 2006 on top of what they paid already.
- Many small webcasters won’t be able to pay these huge fee increases, effectively silencing them.
- Conventional radio stations do not have to pay these fees.
- The new law takes into effect May 15.
- A coalition headed by DIMA (trade organization) includes large brands like Yahoo!, AOL, MTV, Pandora, Real, Live365 to try and stop this new law.
- In comparison to the $25 per listener/yr a conventional radio station pays for a license, a similar internet radio station would be paying $155 per listener/yr. In the year 2010 that fee would be $267 per listener/yr.
- A bill introduced in congress attempting to stop this new law from going into effect is the Internet Radio Equality Act, introduced by bipartisan support from both parties.
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