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Experimental Fees Settle Royalty War For Internet Radio

samzenpus posted about 5 years ago | from the pay-the-man dept.

The Internet 270

S-100 writes "SoundExchange has reached an agreement for royalty rates with a consortium of Internet radio broadcasters. The parties are ecstatic that the issue is finally resolved, and that the new rates are below the previous 'death to Internet radio' levels that had previously been imposed by the CARB. According to NewsFactor, Pandora founder Tim Westergren proclaims that 'the royalty crisis is over!', and other large broadcasters are equally pleased. One unheard-from group is less likely to be pleased: small Internet radio broadcasters. Buried in the details are a new minimum royalty payment: $25,000 per year. So say goodbye to all of the small Internet radio stations that you have been listening to, as they will no longer afford to operate legally."

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270 comments

Social corruption (4, Insightful)

Futurepower(R) (558542) | about 5 years ago | (#28631295)

The rich take advantage of the less rich:

"Buried in the details are a new minimum royalty payment: $25,000 per year. So say goodbye to all of the small Internet radio stations that you have been listening to, as they will no longer afford to operate legally."

Re:Social corruption (-1)

Anonymous Coward | about 5 years ago | (#28631423)

From TFA:
"The agreement also calls for all pureplays to pay an annual minimum fee of $25,000, which can later be applied to royalties.

So, if you make $25,001 a year, you only owe $1 in royalties. And if you only make $25,001 in a year, you should be in a different business.

Re:Social corruption (2, Insightful)

Anonymous Coward | about 5 years ago | (#28631519)

No, you would owe $25,000 in royalties. Minimum payment per year.

Re:Social corruption (-1, Troll)

Anonymous Coward | about 5 years ago | (#28631913)

Now you see the evils of capitalism and the free market. The only vialble solution would be a worldwide communist revolution.

Re:Social corruption (5, Insightful)

Anonymous Coward | about 5 years ago | (#28632297)

This has nothing to do with Capitalism. The Market hasn't spoken, this is about copyright and royalties which is nothing but Government protection of works. Not saying copyright is a bad thing inherently (it is in a bad state if you ask me) but this is nothing but a barrier to entry into the internet radio business. This keeps out the small guy who isn't doing this for money (probably doing it at a loss out of his or her own pocket) and since it's compulsory someone running an internet radio station with just unsigned or independent music will still have to open their wallet to $25,000 a year. This is just a ploy by old media to keep broadcasting in their hands. It won't matter much to the more dedicated of the amateur broadcaster as they can most probably move their operation out of the United States.

Re:Social corruption, or small-player boon? (4, Interesting)

Stephen Samuel (106962) | about 5 years ago | (#28632055)

So say goodbye to all of the small Internet radio stations that you have been listening to, as they will no longer afford to operate legally."

Perhaps -- On the other hand, people who make music available without royalty (thus staying outside of the CARB system) -- such as Creative Commons licenses, or even non-CC licenses which simply explicitly allow On-Air radio stations that aren't part of CARB to play them -- might find themselves with a boon as they will then be the only music that small radio stations will be able to play.

If I was a small (or even not-so-small) musician that wanted my music to get play, I'd probably release my music on a license that allowed people who haven't signed up for CARB to play my music royalty free, but had standard fees for stations that had paid the CARB $25K minimum (I mean, why give up royalties that have already been allocated to me?).

That way, smaller stations can play my music, and the larger stations (that really make money) can give me my fair share of CARB royalties if/when I get big enough to attract the attention of the larger stations.

Re:Social corruption, or small-player boon? (3, Insightful)

GigsVT (208848) | about 5 years ago | (#28632107)

Yeah, except it hasn't happened yet and there's already been plenty of reasons to not listen to mainstream label music.

The main reason probably being that 99% of indie music really really sucks, and people don't want to have to look for that 1%.

Re:Social corruption, or small-player boon? (4, Insightful)

dgatwood (11270) | about 5 years ago | (#28632197)

I don't know if you've noticed, but 99% of commercial music sucks, too. It just has better marketing.

Re:Social corruption, or small-player boon? (1)

SUB7IME (604466) | about 5 years ago | (#28632265)

The lyrics suck, and the sounds are often atrocious, but the beats are unfailingly catchy. Indie bands tend to eschew that.

Re:Social corruption, or small-player boon? (2, Insightful)

X0563511 (793323) | about 5 years ago | (#28632321)

It takes more than a beat to make good music.

Re:Social corruption, or small-player boon? (1)

countertrolling (1585477) | about 5 years ago | (#28632217)

...people don't want to have to look for that 1%.

Don't have to. I just run it through the "good music" filter in iTunes. That's what computers are for.

Re:Social corruption (1)

GigsVT (208848) | about 5 years ago | (#28632125)

...using the coercive power of government.

NO (1)

brilanon (1121645) | about 5 years ago | (#28631301)

Is this the end of [link to small station removed]?!

Re:NO (2, Interesting)

orngjce223 (1505655) | about 5 years ago | (#28631631)

More like the question: Is this the end of Live365? Because I like this one particular community-run station (not naming names here to avoid inviting a lawsuit) that runs on there, and requiring $25,000 will be the death of it unless we can unearth enough money to save it.

Solution... (5, Interesting)

cayenne8 (626475) | about 5 years ago | (#28631873)

We need to come up with a way to do "pirate" internet radio....

Some way to stream anonymously...P2P style, but untraceable? A freenet type thing for pirate internet radio, and that way, ANYONE could broadcast. Not a way really to make money, but, if someone wants to play DJ. You could set up nym email accounts, and communicate with your public, and still avoid identification.

Re:NO (2, Informative)

afidel (530433) | about 5 years ago | (#28632393)

Live365 was covered under last years agreement that capped fees at $50K/year for per station fees AFAIK so that would be an umbrella cost carried by Live365 and then you would be responsible for the per performance royalties.

Crap Link (0)

Anonymous Coward | about 5 years ago | (#28631303)

It doesn't show any text.

Two words: (0)

Anonymous Coward | about 5 years ago | (#28631309)

Pirate radio.

I must say... (-1, Troll)

Anonymous Coward | about 5 years ago | (#28631319)

Fuck this shit.

What about public domain music? (3, Insightful)

kalpol (714519) | about 5 years ago | (#28631335)

Just theoretically, what if a station played only music in the public domain? Would they have to cough up the minimum payment? I'm curious whether the fee is for playing music over the internet, or for playing copyrighted music over the internet.

Re:What about public domain music? (3, Informative)

wikki (13091) | about 5 years ago | (#28631381)

This would only apply to record labels or artists covered by SoundExchange.

Basically it's part of the RIAA so you have the Big 4. Sony EMI, Universal, and Warner.

There may be some others.
http://en.wikipedia.org/wiki/SoundExchange#Business_structure_and_oversight

Re:What about public domain music? (4, Informative)

afidel (530433) | about 5 years ago | (#28631615)

Actually SoundExchange is THE collection agency for streamed royalties in the US, even indie artists have to collect through them unless they negotiate other contracts which is very difficult to do as it involves lawyers and lots of paperwork to opt out of SoundExchange and they would still collect royalties through SoundExchange for any webcasters they didn't have direct agreements with.

Re:What about public domain music? (5, Interesting)

RareButSeriousSideEf (968810) | about 5 years ago | (#28632093)

This is probably the most important (and most likely to be overlooked) point in the whole issue. Artists cannot opt-out. Even artists who have never heard of SoundExchange and have never received a check *from* them are generating revenue *for* them.

This might just be a good issue around which to construct a test case for the judicial system. With good legal counsel close at hand, create a station which exclusively plays content that is offered under a suitably free license (http://openmusic.linuxtag.org/, http://www.danosongs.com/ [danosongs.com] , insert your better suggestion ___ here), or where your station has a separate agreement with the artist, or where the artist is not receiving royalties from SoundExchange (and perhaps thinks he/she should be on the basis that SE has collected them from broadcasters).

Publicize, grow, attract attention belligerently.

SoundExchange *seems* to claim to represent all of these scenarios under the "no opting out" doctrine. There is no music "outside of their catalog" as they have no catalog, just an "all your music are belong to us" clause.

In the first two cases, open licenses and individual agreements *should* trump SE's doctrine. If so, then it's time to set about creating a clearinghouse method for mass producing "individual" agreements.

In the third case, SE is ripping off artists in a sense, and shouldn't be able to get away with it. Many small indie artists haven't a clue about SE or how to get royalties from them. Yet SE *keeps* royalties for artists who don't know how to claim them. Existing under a "no opt out" charter is reason enough that the onus should be on SE to notify artists & rightsholders of royalties they have coming.

Re:What about public domain music? (2, Insightful)

X0563511 (793323) | about 5 years ago | (#28632345)

I think that existing under a "no opt out" charter is grounds to have your charter revoked, under order that you rewrite it without that part, or it's completely forfeit.

Unfortunately (and fortunately for some) I'm not important.

Re:What about public domain music? (1)

afidel (530433) | about 5 years ago | (#28632361)

According to USC 17.112.e.5
License agreements voluntarily negotiated at any time between 1 or more copyright owners of sound recordings and 1 or more transmitting organizations entitled to obtain a statutory license under this subsection shall be given effect in lieu of any decision by the Librarian of Congress or determination by the Copyright Royalty Judges.

This should be perfectly doable, but from what I have read and heard it's almost impossible. Part of the problem is all of the different parts of copyright that may be affected, such as writer, background singer, etc. This doesn't affect a completely original work written and performed by one person who hold all copyrights but that is a fairly unusual situation, so it's simply easier to go by the statutory breakdown specified under mandatory licensing.

Re:What about public domain music? (0)

Kalriath (849904) | about 5 years ago | (#28631395)

SoundExchange collects royalties for all music. Not just its members. so yes, you'd still have to cough up. It's a bit of a scam really.

Re:What about public domain music? (1)

tepples (727027) | about 5 years ago | (#28631491)

SoundExchange collects royalties for all music. Not just its members. so yes, you'd still have to cough up.

And if you don't cough up for your station that plays only Free [freedomdefined.org] music, what grounds will SoundExchange or anyone else have to sue you?

Are you crazy? (2, Funny)

Anonymous Coward | about 5 years ago | (#28631537)

Nobody makes music free, son.

SOMEONE stole it from my music empire.

And give me back those electrons you stole from my computer!

Re:Are you crazy? (3, Insightful)

tepples (727027) | about 5 years ago | (#28631657)

Anonymous Coward wrote in response to a suggestion that the operator of an Internet radio station that is not a day job might be able to avoid the minimum royalty by playing only Free music:

Nobody makes music free, son.

SOMEONE stole it from my music empire.

Are you referring to the mathematical near-certainty that a song's hook will inevitably match that of at least one of the millions of songs in BMI and ASCAP's repertory? Or the precedent set in Bright Tunes Music v. Harrisongs Music that accidentally copying the hook of a song heard a half-decade ago is just as much a copyright infringement as what happens in the warez scene? Or both?

Re:What about public domain music? (2, Insightful)

Verteiron (224042) | about 5 years ago | (#28631545)

They don't need grounds. They can bankrupt you just by filing the suit and dragging out the proceedings.

Re:What about public domain music? (2, Insightful)

tepples (727027) | about 5 years ago | (#28631617)

They don't need grounds. They can bankrupt you just by filing the suit and dragging out the proceedings.

They could do that against somebody who doesn't even run an Internet radio station. Heck, record labels have sued a network printer for copyright infringement. I'd still like to know how broadcasting Creative Commons licensed recordings of public domain musical works exposes me to more risk of being the victim of vexatious litigation than propagating any other Creative Commons licensed work.

Re:What about public domain music? (2, Interesting)

Darkness404 (1287218) | about 5 years ago | (#28631673)

Because the other trade industries don't build on suing individuals? I mean, you could really tick off the publishers/authors guild and they would sue you, but I haven't seen them going through P2P records and suing people for downloading books when not for profit. The various entertainment software people don't really care too much if your an individual pirating stuff. Etc. Movies are sort of a non-issue because of the huge paper trail. From where I am sitting I can plug in a microphone and record a song and with enough editing it could sound similar to a really terrible RIAA artist (I'm no good singer). On the other hand, I can't make a real movie that could be confused with a current or (recent-ish) older film. It simply requires a lot more people and a lot more specialized equipment.

Re:What about public domain music? (2, Insightful)

tepples (727027) | about 5 years ago | (#28631815)

Because the other trade industries don't build on suing individuals?

Capitol v. Thomas identified specific works whose copyrights were willfully infringed. If I can control the playlist and document each work's license at least as well as Wikimedia Commons controls its own, my attorney could get the case thrown out at the "do you own the copyright in this recording?" step.

Re:What about public domain music? (1)

Darkness404 (1287218) | about 5 years ago | (#28631547)

What about an artist who released things under a CC or similar license terms that you met, you used that, then the artist gets signed and releases the same song under a different label? Sure, you still should be able to use the CC licensed one, but you have no proof and good luck fighting the RIAA in court. It sure could cause a ton of pain in the short term.

Re:What about public domain music? (1)

tepples (727027) | about 5 years ago | (#28631571)

What about an artist who released things under a CC or similar license terms that you met, you used that, then the artist gets signed and releases the same song under a different label? Sure, you still should be able to use the CC licensed one, but you have no proof

Wayback Machine by Archive.org might still have a page with the title, artist, and a CC license notice.

Re:What about public domain music? (1)

Darkness404 (1287218) | about 5 years ago | (#28631625)

But there would be still no proof that you were playing the CC licensed one rather then the Warner licensed one because they are the same product. Its similar to having two identical books one published in January and one published in February and determining which is which when nothing has changed in the books themselves and they are mixed together in a large box.

Please show that CC licenses can be revoked (1)

tepples (727027) | about 5 years ago | (#28631759)

But there would be still no proof that you were playing the CC licensed one rather then the Warner licensed one because they are the same product.

In the software world, that's called "dual licensing". As I understand most licenses for free software or free cultural works, individual copies aren't offered under the license; the work is offered under the license, and once it is so offered, such a license can't be revoked. For all the jury knows, I could have copied the work from any redistributor under a CC license. I'd like to see how you think a WMG lawyer would defeat reliance on a CC license.

Re:Please show that CC licenses can be revoked (4, Insightful)

Darkness404 (1287218) | about 5 years ago | (#28631839)

I'd like to see how you think a WMG lawyer would defeat reliance on a CC license.

Simply by taking them to court you can crush a lot of small stations. When given the option of A) shutting down and WMG will waive the fee B) paying some sort of large (but not huge) fee like $5000 or C) being sued for $50000+. Most stations, especially those ran by individuals in their spare time would simply choose to shut down. The fee could cause a sharp increase in operating costs so the "ad free" station suddenly has more ads then terrestrial radio. If they go to court, they might keep operating for some time, but eventually the court costs could drain their operating costs budget to where they can't afford it. Even if the internet radio people win, they still lose.

Re:Please show that CC licenses can be revoked (3, Interesting)

Stephen Samuel (106962) | about 5 years ago | (#28632119)

I expect that the FSF, and/or other like-minded associations would be willing to buck up and support the first few stations to get sued that way...

Thankfully, Copyright law has a 'loser pays' rule which means that, once you show that you there's a CC licensed version of your song, it's up to the RIAA lawyers to prove (on the balance of the probabilites, with a tie being in your favor) that you were playing a non-CC version of that song.

If they fail to do so (and they're likely to fail if they're suing on false pretenses), then they're the ones who end up paying your court costs.

Re:What about public domain music? (0)

Anonymous Coward | about 5 years ago | (#28631933)

Since when does the Mafia need grounds to sue?

Re:What about public domain music? (1)

bertoelcon (1557907) | about 5 years ago | (#28631495)

Public Domain would have royalties of $0.00 so there would be nothing to cough up.

Re:What about public domain music? (Podsafe) (1)

FiskeBoller (536819) | about 5 years ago | (#28631513)

I thought this might be addressed by the concept of "Podsafe" music which allows for free play over web (under Creative Commons license). However, it's not clear to me that Podsafe is always a guarantee for all types of web transmission.

http://en.wikipedia.org/wiki/Podsafe [wikipedia.org]

Re:What about public domain music? (1)

Late Adopter (1492849) | about 5 years ago | (#28631833)

You can always license music individually with the rights owner, via for example Creative Commons, or go public domain where you can. What this deal covers is the "compulsory" license, which rights holders are obliged to accept if you want their music under those terms.

Re:What about public domain music? (4, Insightful)

jonwil (467024) | about 5 years ago | (#28632037)

It doesn't matter if you personally held the copyright to every single piece of audio played on your station. The RIAA will still insist you pay up (or at least file reams of paperwork that no small station can afford to file)

Podcasts (1)

Starlon (1492461) | about 5 years ago | (#28631337)

The article seems to be dead. Is this merely music related, or does this include podcasts featuring only news? This is the first I've heard of this.

Re:Podcasts (1)

Starlon (1492461) | about 5 years ago | (#28631355)

Nevermind. The article finally loaded. It's music related.

What are they paying now? (1)

wikki (13091) | about 5 years ago | (#28631339)

What are smaller broadcasters required to pay now? $2100 per month doesn't seem like a terrible amount. I guess if you are a super small station you are going to be in trouble. What about SomaFM?

Re:What are they paying now? (3, Informative)

Neoncow (802085) | about 5 years ago | (#28631459)

If I understand, that's just for the right to not be sued for broadcasting the music. Broadcasters still have to pay to buy the music, for bandwidth to stream the music, hardware to do that, people to select music, build websites themselves, manage online communities, manage advertising relationships, etc.

AND that's the minimum. So if you have zero listeners, you have to pay $25 000 per year just to start.

goodbye to the small Internet radio station? (4, Insightful)

Ralph Spoilsport (673134) | about 5 years ago | (#28631345)

In the USA maybe. I have a suspicion other countries might have a different notion of how that might work out...

Re:goodbye to the small Internet radio station? (3, Informative)

RLiegh (247921) | about 5 years ago | (#28631367)

I, for one, welcome our new allofinternetradio.ru overlords.

Re:goodbye to the small Internet radio station? (0)

afidel (530433) | about 5 years ago | (#28631403)

Most of the developed world is worse which is why pandora and others aren't available outside the US. Other countries either have higher rates or don't have standardized rights so you have to negotiate per piece which is obviously untenable.

Play new music, not corporate label rehash. (4, Insightful)

jbn-o (555068) | about 5 years ago | (#28631587)

Not only does this new deal not cover every country (the Internet has this global presence to it) but this new deal doesn't cover all music which is legally redistributable in the US. Support artists who aren't signing their copyrights away to the huge few corporate labels, support musicians who share with you under terms that allow you to share further, and you'll find there's a lot of good music out there to be enjoyed. Small radio stations would do well to stop trying to emulate the major radio stations and develop audiences that appreciate something different and new.

Strange agreement. (0)

Anonymous Coward | about 5 years ago | (#28631347)

Following the link I see that the agreement consists of... an add for a printer.

Is this just in the US? (3, Insightful)

1mck (861167) | about 5 years ago | (#28631353)

Does this only pertain to the US, or is it all over the world?

Anyone Else Notice Pandora Lately? (1, Insightful)

Anonymous Coward | about 5 years ago | (#28631385)

Pandora is starting to sound a lot like regular ClearChannel FM. Funny how that happens.

Re:Anyone Else Notice Pandora Lately? (1)

Verteiron (224042) | about 5 years ago | (#28631567)

How so? My stations are playing the same kind of music they've always played. In fact, they seem to have picked up some new artists lately, which is nice.

Re:Anyone Else Notice Pandora Lately? (1)

afidel (530433) | about 5 years ago | (#28631671)

Uh, you mean YOUR Pandora stations sound like terrestrial radio? Right? Because none of my stations sound like anything I can get near me lacking any good college stations. My first couple stations are:

Django Reinhardt Radio
Electro Station #1 (Orbital, Orb, Wink)
Gaelic Storm Radio
etc
Or are you talking about their attitude? They are a business and want to make some profit to continue to operate, but they hardly seem anything like the homogonizing, profit maximizing, soul crushing folks at CC.

Re:Anyone Else Notice Pandora Lately? (1)

Darkness404 (1287218) | about 5 years ago | (#28631749)

Or are you talking about their attitude? They are a business and want to make some profit to continue to operate, but they hardly seem anything like the homogonizing, profit maximizing, soul crushing folks at CC.

Pandora founder Tim Westergren proclaims that 'the royalty crisis is over!', and other large broadcasters are equally pleased

Lets see, he is cheering on this that will save Pandora and perhaps a few more stations but crush the rest. It reminds me of a certain operating system vendor....

Thats not to mention their reduction in skips, inclusion of audio ads, etc.

Re:Anyone Else Notice Pandora Lately? (1)

afidel (530433) | about 5 years ago | (#28631823)

inclusion of audio ads, you mean *shock* they want to make money for their efforts and expenditures!? SiriusXM charges the same $3/month to stream at lower quality and that is the ADDON cost to an already fairly expensive service. Oh and you don't get to customize your listening experience with SiriusXM either.

Re:Anyone Else Notice Pandora Lately? (0, Troll)

Darkness404 (1287218) | about 5 years ago | (#28631863)

...So you are defending a crappy product with a crappier product? Well, Windows ME didn't make my computer burst into flames whenever I loaded it on a computer, so it must be a great OS! Seriously, SiriusXM has few stations and no less DJ chatter/radio spam then terrestrial radio, and honestly, if I was paying for the service (the only time I ever used it was when I got a like 3 month trial with a car) I would rather it be much more like an iPod or CD, music non-stop. But again, just because a product is better then a terrible product, doesn't mean that the product is good.

$25,000 barrier to entry (4, Interesting)

ErikTheRed (162431) | about 5 years ago | (#28631425)

According to NewsFactor, Pandora founder Tim Westergren proclaims that 'the royalty crisis is over, and we don't have to worry about any small competitors sneaking up and taking our business!'. I may have added that last part, but I'm sure he was thinking it. Like most regulations, it serves mainly to fuck small business and eliminate competition.

Re:$25,000 barrier to entry (5, Insightful)

Apathist (741707) | about 5 years ago | (#28631805)

Why are we all so busy blaming Pandora for this?

IIRC, they were just trying to save themselves from getting annihilated by these preposterous fees... and now we're giving them a hard time because they didn't save every other tiny internet radio station all at once?

Seems to me that we won the battle, but not the war (yet). So let's celebrate that instead of flagellating those fighting on our side, yeah?

Re:$25,000 barrier to entry (3, Insightful)

TubeSteak (669689) | about 5 years ago | (#28632277)

According to NewsFactor, Pandora founder Tim Westergren proclaims that 'the royalty crisis is over, and we don't have to worry about any small competitors sneaking up and taking our business!'. I may have added that last part, but I'm sure he was thinking it. Like most regulations, it serves mainly to fuck small business and eliminate competition.

1. This isn't a regulation, it's a cartel whose licensing terms are enforced by [government]
2. And this $25K business sounds ripe for anti-trust investigation. How is it not abuse of a monopoly position?

A great opportunity for upstart talent... (4, Interesting)

Bones3D_mac (324952) | about 5 years ago | (#28631467)

Perhaps now is a good time for all the upstart talent out there to be heard before getting their work corrupted by the recording industry. Small broadcasters should set up their own organization to collectively promote new talent by sharing their newly found content with each other for broadcasting. All that would be needed is some sort of vetting system to ensure the work isn't already owned by someone other than the artist that created it.

Re:A great opportunity for upstart talent... (2, Interesting)

Darkness404 (1287218) | about 5 years ago | (#28631523)

Sure, but that still could be a minefield. Lets say a small band in 2009 releases music that isn't covered by this. You play it thinking its safe or you had an agreement reached with the band or something. 2010 rolls around and they get signed on by Warner. Now, because Warner owns all their songs, you have little proof that the songs you play were released before then because its the same song. So you get sued. The problem with indie bands is they don't stay indie if they are decent enough.

Re:A great opportunity for upstart talent... (1)

PPH (736903) | about 5 years ago | (#28631785)

Sure, but that still could be a minefield. Lets say a small band in 2009 releases music that isn't covered by this.

Define 'release' from a legal perspective. If you just find some music on line, you are taking a risk downloading and playing it. Even if the performers post it there themselves. How are you to know that they have the rights to do so? Some legal title needs to be in place to define performers' ownership even when a recording label isn't involved.

2010 rolls around and they get signed on by Warner. Now, because Warner owns all their songs,

All their songs? What if this is a band than moved from one record label to another? The previous label would still have rights to their old work. Warner would only get the new stuff.

And that's the system that would have to be set up to cover self-releasd content. Whether its the attachment of a Creative Commons type license, or putting together some sort of cooperative (performer-owned) "recording label" that would represent their rights, once this is done, and this license, or label grants rights for free Internet play, subsequent contracts with Warner coudn't reach back to this earlier content any more than they could to that owned by a smaller label.

Re:A great opportunity for upstart talent... (1)

blackraven14250 (902843) | about 5 years ago | (#28632049)

Whether its the attachment of a Creative Commons type license, or putting together some sort of cooperative (performer-owned) "recording label" that would represent their rights, once this is done, and this license, or label grants rights for free Internet play, subsequent contracts with Warner coudn't reach back to this earlier content any more than they could to that owned by a smaller label.

That assumes they release it on a "label" to begin with. Let's go with this scenario: I make a song, I put it on the internet without anything denoting it being licensed in any way. Then, I get signed to Warner, and they want that song. I just had that song go from "Have fun with it" status to "You're screwed if you're playing it" status without anyone knowing.

Now, take another scenario: I release a song on CC. I change one knob on a synth slightly, rerecord, and have a contract with Warner for the song. Who the hell is gonna be able to tell the difference?

Re:A great opportunity for upstart talent... (0)

Anonymous Coward | about 5 years ago | (#28631769)

Indie bands should get together to set up something to broadcast their music. Heck, anybody can do this by contacting indie bands, and requesting a non-exclusive, non-expiring license to broadcast their works over internet radio so long as all of the copyright holders are still alive.

SomaFM? (1)

winphreak (915766) | about 5 years ago | (#28631473)

What about SomaFM? How will this affect their royalty issues?

Re:SomaFM? (1)

afidel (530433) | about 5 years ago | (#28631887)

According to the message at the top of the news page they are $30K in the red for 1H'09 with the old royalty rates so probably not so good. If it wasn't for Pandora I would probably be sending them a couple hundred like in years past but I haven't listened in over a year.

Re:SomaFM? (1)

winphreak (915766) | about 5 years ago | (#28632009)

That's what I was afraid of as well.
I didn't start donating until the ridiculous rates from a few years ago kicked in, but here's hoping they keep going strong.

I'm thinking it would be best to just wait until they post on their blog about how it affects them. Either it'll be a huge sigh of relief, or a kick in the pants.

$25,000 is not much for small businesses (0)

panoptical2 (1344319) | about 5 years ago | (#28631487)

Guys... It's not that hard to get a small business loan of $25,000, if you present to the bank that you have the know-how (and a business degree would help). Plus from the TFA of a related story...

All webcasters would pay a minimum fee of $25,000 for legal access to the music they stream, but that money could be applied to what they owe in royalties, making it more of a down payment.

In other words, this is $25,000 that they would be normally paying anyway.

Re:$25,000 is not much for small businesses (3, Insightful)

Arker (91948) | about 5 years ago | (#28632353)

For some cases you are obviously correct.

However in the case of the smaller stations this can be a daunting if not insurmountable price.

Consider, a station which plays primarily alternative music sources, but plays *one song* from the RIAA catalog, once, in a year. Still out $25k for that one song.

The pricing structure is clearly designed to exclude smaller and/or less mainstream stations.

HA! (1)

binarybum (468664) | about 5 years ago | (#28631493)

I bet their Friggin' "Ecstatic"! Most of the big broadcasters will easily make double the fee over the next year in increased traffic from all the people that no longer can listen to the really good smaller radio stations.

$25K Adds Barrier of Entry to Control net Radio (5, Informative)

Hodejo1 (1252120) | about 5 years ago | (#28631531)

A big reason that traditional radio stations are in the hands of conglomerates only is because the cost of the antenna, broadcast equipment, and the scarcity of available frequency makes it extremely expensive to start a new terrestrial radio station. A Net radio station only needs a Net connection and some open source applications. The 25K means individuals are no longer able to run a free Net radio station. It will also knock out college radio stations who simultaneously stream the terrestrial broadcasts they deliver for no fee. Hobby Net radio is dead in this country. Of course, the agreement only applies to the US so overseas folk can pick up the slack...for now. A shame really and not the win Pandora calls it. It just helps the mid-sized VC-funded

Yes, you can, you can't use copyrighted music as t (-1, Troll)

Anonymous Coward | about 5 years ago | (#28631583)

Yes, you can, you can't use copyrighted music as the lure. If you want to play radio host, play radio host. If you want to play DJ, and use my songs, you need to pay. If you want cable, you have to pay. If you want gas/electric, you have to pay. Yes, you as a slashdotie HAVE THE RIGHT to steal cable, and jury-rig the power company's meters, but if you want to play DJ, you have to PAY ME. It's so written, and is the LAW.

Go fuck yourself. (-1, Troll)

Anonymous Coward | about 5 years ago | (#28631633)

Suck my cock, faggot.

Re:$25K Adds Barrier of Entry to Control net Radio (5, Insightful)

Darkness404 (1287218) | about 5 years ago | (#28631595)

Pandora is basically in the pocketbooks of the RIAA. Pandora is no longer the small "fight for your rights to listen to music as you wish" radio station, but rather the MS of internet radio. What Pandora calls a win for internet radio, is the same as Ballmer calling something a win for operating systems. They only see themselves and one competitor. Pandora wants all the small stations (and Last.FM) to die as much as Ballmer wants Linux and OS X to die.

Think "COOP", not "Compete" (3, Interesting)

Jason Pollock (45537) | about 5 years ago | (#28631585)

Look at it this way. You and 99 of your friends can now have all-you-can-eat streaming music for US$250/yr + costs, as long as your costs are US$100k (royalties are 25% of costs or revenue, whichever is higher) - running it as a coop means no revenue.

Even better, you can offer it to everyone!

Sounds like a great way to have a large, legal, on-demand music collection.

Re:Think "COOP", not "Compete" (1)

Jason Pollock (45537) | about 5 years ago | (#28631609)

slashdot ate my less than.

"as long as your costs are _less_than_ US$100k"

So, your cost is US$25k + Transmission and Hosting.

Re:Think "COOP", not "Compete" (1)

saleenS281 (859657) | about 5 years ago | (#28632105)

At $250/year, I could buy and OWN all the music I want in *maybe* two years time. That's being gracious. I can't think of 25 cd's produced by the MAFIAA in the last 5 years I would shell out the cash for on the *cheap* rack. It wouldn't take very many cd's to fill out what I don't already own.

BILLY MAYS HERE... (2, Interesting)

BillyMays (1587805) | about 5 years ago | (#28631607)

With double standards! Remind me again why streaming is any different from broadcasting over radio waves?

Re:BILLY MAYS HERE... (1)

Delwin (599872) | about 5 years ago | (#28631885)

Because radio waves have a limited range.

Re:BILLY MAYS HERE... (0)

Anonymous Coward | about 5 years ago | (#28632403)

Depends on the transmitter and the frequency. You can pick up the Vatican's shortwave transmission pretty much anywhere on the planet.

This is an outrage! (1)

Orion Blastar (457579) | about 5 years ago | (#28631613)

Small Internet Radio Stations cannot afford the minimum $25,000 a year fee to operate.

This is the RIAA screwing over the small business and non-profit organizations in the music business. Next I suppose they will hit up DJs for a minimum fee for $25,000 a year to play Audio CDs and MP3 files they legally own?

Re:This is an outrage! (3, Informative)

bmo (77928) | about 5 years ago | (#28631735)

That would be ASCAP, not the RIAA.

"ASCAP protects the rights of its members by licensing and distributing royalties for the non-dramatic public performances of their copyrighted works. ASCAP's licensees encompass all who want to perform copyrighted music publicly."

http://www.ascap.com/about/ [ascap.com]

Ambiguous, too (3, Interesting)

S-100 (1295224) | about 5 years ago | (#28631699)

Perusing the info on SoundExchange, the wording is ambiguous. In the press release, they clearly say that all "Pure Play" webcasters, small and large, are subject to the $25,000 per year minimum fee against royalties. But in another section of the web site, they list the $25,000 fee in the section for large webcasters and say nothing about a minimum fee in the following section about small broadcasters. So there's a chance that the fee may not apply to small webcasters.

It should also be said that this "special deal" is opt-in, and not compulsory. Webcasters are still free to adopt the rate structure established earlier by the CRB, however it was those rates that caused the revolt by webcasters in the first place, since those rates are so high that a typical small station could end up owing over 100% of revenues to Sound Exchange.

worksforme (0)

Eil (82413) | about 5 years ago | (#28631745)

So say goodbye to all of the small Internet radio stations that you have been listening to, as they will no longer afford to operate legally.

Fine by me. The stuff I want to listen to is not under the RIAA's or ASCAP's jurisdiction anyway.

Re:worksforme (1)

Darkness404 (1287218) | about 5 years ago | (#28631793)

...Thats what you think. Until your favorite radio station plays a song that might be part of there. Then cue the money-sucking drawn out trial where your favorite station will die even if they are found not to be infringing.

Got this email from their CEO (Tim) (5, Informative)

alexfeig (1030762) | about 5 years ago | (#28631831)

I've been listening to pandora since it came out - I'm a huge fan. I got this email yesterday... pretty interesting. Apparently I like their free service *too* much:

I hope this email finds you enjoying a great summer Pandora soundtrack.

I'm writing with some important news. Please forgive the lengthy email; it requires some explaining.

First, I want to let you know that we've reached a resolution to the calamitous Internet radio royalty ruling of 2007. After more than two precarious years, we are finally on safe ground with a long-term agreement for survivable royalty rates â" thanks to the extraordinary efforts of our listeners who voiced an absolute avalanche of support for us on Capitol Hill. We are deeply thankful.

While we did the best we could to lower the rates, we are going to have to make an adjustment that will affect about 10% of our users who are our heaviest listeners. Specifically, we are going to begin limiting listening to 40 hours per month on the web. Because we have to pay royalty fees per song and per listener, it makes very heavy listeners hard to support on advertising alone. Most listeners will never hit this cap, but it seems that you might.

We hate the idea of capping anyone's usage, so we've been working to devise an alternative for listeners like you. We've come up with two solutions and we hope that one of them will work for you:

Your first option is to continue listening just as you have been and, if and when you reach the 40 hour limit in a given month, to pay just $0.99 for unlimited listening for the rest of that month. This isn't a subscription. You can pay by credit card and your card will be charged for just that one month. You'll be able to keep listening as much as you'd like for the remainder of the month. We hope this is relatively painless and affordable - the same price as a single song download.



Your second option is to upgrade to our premium version called Pandora One. Pandora One costs $36 per year. In addition to unlimited monthly listening and no advertising, Pandora One offers very high quality 192 Kbps streams, an elegant desktop application that eliminates the need for a browser, personalized skins for the Pandora player, and a number of other features: http://www.pandora.com/pandora_one [pandora.com] .

If neither of these options works for you, I hope you'll keep listening to the free version - 40 hours each month will go a long way, especially if you're really careful about hitting pause when youâ(TM)re not listening. Weâ(TM)ll be sure to let you know if you start getting close to the limit, and weâ(TM)ve created a counter you can access to see how many hours youâ(TM)ve already used each month.

Weâ(TM)ll be implementing this change starting this month (July), Iâ(TM)d welcome your feedback and suggestions. The combination of our usage patterns and the "per song per listener" royalty cost creates a financial reality that we can't ignore...but we very much want you to continue listening for years to come.

Re:Got this email from their CEO (Tim) (1)

Jay L (74152) | about 5 years ago | (#28632331)

about 10% of our users who are our heaviest listeners

I wonder how many of those are "the whole office"? I know a few offices I've been to where Pandora replaced the workplace radio. There must be a reason we were daily reminded that "The station you listen to all day, every day at work is WRQX". Those listeners belong to Pandora at the moment, but I don't think anyone's going to be paying for the privilege.

Who cares about smaller internet radio stations? (1)

wasmoke (1055116) | about 5 years ago | (#28631857)

To be honest, the point of traditional radio stations seems to me that you can listen to X genre in Y area. With internet radio, Y no longer matters, and for many stations like Pandora and Last.fm neither does X, as they offer many different genres. Why do we need a large station like last.fm alongside a smaller internet radio station? What can the small one offer that the larger cannot if they are both free?
These aren't rhetorical questions- If anyone prefers a smaller station to a larger I'd like to know why.

Re:Who cares about smaller internet radio stations (3, Insightful)

Thalaric (197339) | about 5 years ago | (#28632267)

I you were a starting entrepreneur who wanted to become one of those large internet radio stations some day your view might be different. Artificially high barriers of entry into an industry are rarely beneficial to society. From a purely economic standpoint, competition is generally a good thing.

Re:Who cares about smaller internet radio stations (5, Insightful)

iksbob (947407) | about 5 years ago | (#28632335)

the point of traditional radio stations seems to me that you can listen to X genre in Y area

The point of traditional radio stations is to cover costs (and preferably make a profit) with revenue from advertisers by distributing their material to the populace. The populace generally isn't interested in listening to advertisements all day long, so the radio stations must provide material the populace is interested in, with advertisements thrown in periodically. Range "Y" is an artifact of radio broadcasting and power limitations imposed by the FCC to allow wider use of radio spectrum. I agree that the internet's nearly infinite supply of spectrum eliminates the need for any kind of range limitations. Genre "X" limitations are similarly a radio spectrum issue and need not exist on the internet.

Why do we need a large station like last.fm alongside a smaller internet radio station? What can the small one offer that the larger cannot if they are both free?

Try turning that around: "What can the large one offer that the smaller one cannot if they are both free?" Really, I would expect a larger entity to develop into a far more bureaucratic system, making it slow to respond to listener's changing interests and requests. Further, large entities are somewhat resilient to legal action and more difficult to reconstruct, making them more easily controlled by external parties such as large copyright holders. Such legal action on a small entity would likely crush it, but a new one could quickly sprout up in the hole left by the original. Going back to the original question: "What can the small one offer that the larger cannot i they are both free?" Simply put, adaptability and resistance against external corruption. These qualities do not mesh well with the music industry's legacy business model, thus the attempt to eliminate them with a $25,000 minimum charge. I would be interested to see what kind of logical knots they try to tie in their attempts to defend this minimum.

'the royalty crisis is over!' (1)

countertrolling (1585477) | about 5 years ago | (#28632167)

Oh really? I guess since Pandora came out stinking like a rose, it must be true. I mean, it's not like anybody else matters or anything...I wonder where Clear Channel is..."Consortium"? Somebody misspelled cartel... fuckers... Long live "pirate" radio...

Two words...Media PC (0)

Anonymous Coward | about 5 years ago | (#28632241)

Just some food for thought...but alot of people are already paying for music. I know I am...My Dish Network service comes with 'most' of the Sirius channels. I have a small ~$200 media PC setup to stream TV2 for both video and audio. It has a small web interface that i built that lets me switch channels on the dish box. I have three streams...one for highBW video/audio (512Kbps), one for low res video/audio (128Kbps), and one for audio only (96Kbps). With this $200 box, I stream out all the TV/Radio that i am already paying for for use on my laptop/blackberry..and um yes...work (music only...I promise :D)

So why am i talking about a media PC on this thread?

People who actualy use these 'free' internet radio site are probably paying for the music they love already(cable/dish/etc...). For the price of a low end ipod and some time...anyone can take that power away from the record commpanies. SlingBox is another example...but the PC (Actualy...i hate calling them PCs lately because of the stupid MS comercials...so lets say...Penguin...New phrase "It's a Penguin"...that would be a good comercial...lol...anyways i digress) is more versital.

People talk about how they 'hate' the record companies...my advice...there are ways of fighting back without lawyers or HUGE money involved....Help me lead the revolution 1 Media PC at a time.

Adam - (PS. I have been trying to create a slashdot ID FOREVER...I never get the 'conformation email'...i have contacted help..none...so this is my way of posing non-Anonymous Coward)

I see a solution... (1)

vrmlguy (120854) | about 5 years ago | (#28632293)

Why not broadcast the music and the "DJ" separately? The DJ says, "Here's a song you'll like" and sends a JSON packet to your browser, telling it to (a) listen to it on Pandora or Last.fm or something, and (b) switch back to the DJ when the song is done.

Re:I see a solution... (1)

yincrash (854885) | about 5 years ago | (#28632417)

What is this a solution for exactly?
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