Internet radio royalty rates affect HD Radio

[700WLW]

Since, you do not care for blogs, here you go:

"New Copyright Fees Set For Internet Radio"

"The Copyright Royalty Board on Friday issued a decision that sets per performance rates that Internet radio stations must pay each time a single listener hears a song. In doing so, the board rejected the pleas of Internet radio providers that sought royalty rates based on a percentage of revenue... The minimum fee is $500 per channel per year, although Oxenford notes there is no clear definition of what constitutes a "channel" for services that allow users to create individualized playlists. The rates to be paid are as follows:"

http://www.radioink.com/headlineentry.asp?hid=137060&pt=inkheadlines

A particular poster here, tried to claim that these fees were going to be based on a percentage of revenue, and since the streaming HD channels do not produce revenue, this would be no concern for HD Radio - as we can see, it is a set fee per-channel/per-song/per-listener. Sorry folks, these fees will affect non-interactive Internet Radio broadcasters and the HD channels are included. Maybe, the RIAA will find a way to go after terrestrial HD Radio - let's hope so !

Allow me to put on my Captain Obvious hat for a second...

The entire article you cite is about royalties on INTERNET based streaming. Anyone with the reading skills of a 2nd grader could easily see that.

This has absolutely nothing to do with HD Radio - period. I realize you're desperately grasping at straws and praying for some bad news for HD Radio, but there is simply no connection between the royalties being imposed on webcasters and HD Radio - zero, zip, zilch, nada, none!

This entire thread, like so many of the mindless blog posts here has been nothing but a huge waste of everyone's time. It's not relevant to the board at all and is merely idle speculation.

"Internet radio royalty rates decided (Verdict: it ain't good news)"

"The death of Internet radio, and the damage done to HD Radio, could affect federal regulator's decision for the merger and the definition of the relevant market."

"Smaller terrestrial radio stations will probably abandon online streaming as they'll be paying more for online streaming then they will for regular broadcasts (and for far less of an incoming revenue stream). This applies just the same for HD2 streaming."

http://www.orbitcast.com/archives/i...-rates-decided-verdict-it-aint-good-news.html

"New Copyright Fees Set For Internet Radio"

http://www.radioink.com/headlineentry.asp?hid=137060&pt=inkheadlines

"Free HD Radio streaming online"

http://digg.com/music/Free_HD_Radio_streaming_online

I really don't understand how you could be so confused - from the copy of the articles, that I have been posting and started this thread with, this affects HD streaming on the Internet and non-interactive Internet broadcasters.

 

[EasyPeazy]

I really don't understand how you could be so confused - from the copy of the articles, that I have been posting and started this thread with, this affects HD streaming on the Internet and non-interactive Internet broadcasters.

So are you now claiming this ONLY effects the web streams of HD stations? Funny - that doesn't seem to be the point you were trying to convey.

If you're being sincere here and indeed you were intending to talk about the web streams of HD channels, then the very title of this thread is confusing - intentionally I'm sure.

Regardless - if all web streaming went away (and it's looking as though it might) that's the very best thing that could happen to traditional radio in all forms - AM, FM and HD.

If you can't listen to it on the internet, where can you hear it? Over the air? Since that's the business we're in, it seems that would be very good for ALL broadcast radio including HD!

 

[RadioStarOne]

All any of this really means is that if you want to be in the internet audio streaming business using copyrighted music of any type is that you'd better have a solid business plan for success. All of you bantering back and forth here seem to be forgeting that there are lots of ways to offset the cost of the music performance fees and make a ton of money doing so in the process.

 

[EasyPeazy]

All any of this really means is that if you want to be in the internet audio streaming business using copyrighted music of any type is that you'd better have a solid business plan for success. All of you bantering back and forth here seem to be forgeting that there are lots of ways to offset the cost of the music performance fees and make a ton of money doing so in the process.

That's what I thought too - then I did the math. It's prohibitively expensive.

 

[RadioStarOne]

See thats the problem you can't figure it out but thousands of others will find a way to make it work! Never say never because you will be left in the dust.

 

[EasyPeazy]

See thats the problem you can't figure it out but thousands of others will find a way to make it work! Never say never because you will be left in the dust.

I'm not a webcaster and don't plan to be - especially not now. There are much easier ways to make money in businesses where you don't start off with an albatross like this. If you want to have a go at it, go right ahead. Most people are in business to make lots of money - not eek out a small profit with huge risk of loss.

http://www.kurthanson.com/archive/news/030207/index.shtml

A few highlights from the article:

The AOL Radio Network would have a royalty obligation to SoundExchange of approximately $1.65 million per month in 2006. Of course, the royalty rates increase dramatically between now and 2010.

Pandora.com estimates "such a royalty obligation might exceed the total proceeds of all their recent rounds of venture capital plus all their sales revenues to date."

For the "average webcaster" the royalties would amount to 150% to 200% of total revenues.

 

[RadioStarOne]

Well here we go again, back to the courts and the halls of congress! Round three coming up! Stay Tuned!

 

[Chuck]

Well here we go again, back to the courts and the halls of congress! Round three coming up! Stay Tuned!

You're probably right, but most small web streamers can't afford the legal costs. They just don't make much (if any) money. For a small broadcaster that plays about 16 songs per hour, and who has an average of 500 listeners, the bill will come to a bit more than $75,000 this year and will rise in later years. I don't know what you could sell to 500 listeners that would offset that kind of expense. Crack cocaine, maybe?

Something else nobody has mentioned is Sound Exchange now wants Internet stations to retroactively report the songs they have played for a two week period in each quarter, dating back to 2004. Even if they have the records, that is going to be very hard to do.

As far as I can tell, if this ruling stands, it is incredibly good news for the proponents of HD radio, or at least for some form of multicasting. It effectively puts the competition from other technologies out of the picture.
.

 

[vsa]

This could also help to kill the XM-Sirius merger. Mel Karmazin's testimony in Washington tried to paint the union as no-way being a monopoly, what with all of that Internet-based competition out there. With the competition being killed off, it sure is looking a lot more like a monopoly now.

As for the big terrestrial broadcasters with their HD-R installations, they can't start cheering yet. This still doesn't mean that people will magically flock into stores to scoop up HD radios. What if they still don't. I think that's still likely to be the case. AOL, Yahoo and other big boys will continue streaming as loss-leaders supported by their highly profitable operations. Stations from overseas will still be available on the web. So will access to all kinds of music, legal and illegal. Streaming news, talk and sports radio will not be affected. The growth of the wired and wireless Internet will continue unabated. Without a strong streaming presence on the web, radio could just slowly fade away into an irrelevant oblivion. Terrestrial radio may now be priced out of a future on the Internet. A streaming presence has served as a sort of guarantee against too much risk. That can only be bad news, Very bad and very risky!

The 1998 DMCA and related laws of the 90's need to be revisited. The RIAA won a huge victory over all broadcasters and that reality is only now being realized.

 

[Chuck]

The growth of the wired and wireless Internet will continue unabated. Without a streaming presence on the web, radio could just slowly fade away into an irrelevant oblivion. Terrestrial radio may now be priced out of a future on the Internet. That can only be bad news, Very bad and very risky!

I think this is a classic case of throwing the baby out with the bath water. Or maybe it is the little Dutch boy who tried to plug the dike with his finger.

It is unlikely that the world is going to ignore the Internet. What it means is that we, the people of the US who try to obey our laws, will be forced out of the playing field. I see that as a real problem.

 

[SUPERCASTER]

SoundExchange is the first organization formed in the United States to collect performance royalties for sound recording copyright owners (SRCOs), featured and nonfeatured artists. SoundExchange is an independent nonprofit performance rights organization that currently represents over 1,000 record companies, their 3000+ labels and thousands of artists united in receiving a fair price for the licensing of their music in a new digital world. Our members include small, medium and large independent record companies, as well as the major label groups and artist-owned labels.

Sound Exchange does not cover:

Analog public performances (traditional radio and television)

http://www.soundexchange.com/faq.html#a1

 

[EasyPeazy]

SoundExchange is the first organization formed in the United States to collect performance royalties for sound recording copyright owners (SRCOs), featured and nonfeatured artists. SoundExchange is an independent nonprofit performance rights organization that currently represents over 1,000 record companies, their 3000+ labels and thousands of artists united in receiving a fair price for the licensing of their music in a new digital world. Our members include small, medium and large independent record companies, as well as the major label groups and artist-owned labels.

Sound Exchange does not cover:

Analog public performances (traditional radio and television)

http://www.soundexchange.com/faq.html#a1

Major find there Supercaster! Too bad it's meaningless.

Radio as an industry already pays royalties on HD channels to the appropriate agencies. I don't see that changing.

 

[SUPERCASTER]

SoundExchange is the first organization formed in the United States to collect performance royalties for sound recording copyright owners (SRCOs), featured and nonfeatured artists. SoundExchange is an independent nonprofit performance rights organization that currently represents over 1,000 record companies, their 3000+ labels and thousands of artists united in receiving a fair price for the licensing of their music in a new digital world. Our members include small, medium and large independent record companies, as well as the major label groups and artist-owned labels.

Sound Exchange does not cover:

Analog public performances (traditional radio and television)

http://www.soundexchange.com/faq.html#a1

Major find there Supercaster! Too bad it's meaningless.

Radio as an industry already pays royalties on HD channels to the appropriate agencies. I don't see that changing.

Don't bet on it.
The rates for digital transmission are retroactive. Digital HD broadcasters have been claiming they are exempt and "grandfathered" under the old compulsory license analog AM and FM broadcasting have enjoyed. The RIAA and Sound Exchange claim jurisdiction over all digital transmissions according to the DCMA.
Don't confuse author's rights such as BMI and ASCAP with performance rights such as Sound Exchange. Both need to be paid for all digital media.
Internet stations provide the same artist/album/tune promotion to the public that AM and FM stations do, and many provide title/artist/label information (just as HD) plus simple, one click links (many internet stations are also are visual complete with album cover pictures) to immediately and legally buy the music. Radio stations, even HD does not do all of that for the record industry, or artists.
All those spurious claims that record companies sales depend solely on AM and FM station broadcast promotion are just broadcasters power dreams of times gone by (by).

 

[Mike Walker]

Geez, guys. An increase (and a ridiculous one!) to WEBCASTERS is not a "blow" to terrestrial broadcasting, either analog or digital, any more than a rise in the price of milk is. What it IS is potentially the death blow to most INTERNET broadcasting...you know, the thing you've been telling us made HD "DOA".

I've been researching this. There are NO implications to traditional radio. It specifically excludes "established stations". Guys, that's AM and FM (and probably Sirius and XM as well). It has EVERYTHING to do with streaming by internet-only stations.

I'm an HD fan, and I take no joy in this. I LOVE radio, in all it's forms...including the internet. Potentially (there will undoubtedly be legal challenges) this is devastating to the very people who provide variety, who don't worry about ratings and charts...the little guy, who will be every more punished by success. I've stated before that it's possible for internet stations to bankrupt themselves with "success" due to the upward spiral of bandwidth costs for serving ever more people. Tack this on, and the "bankrupt yourself with success" obstacle ahead seems enormous. Here's hoping they chart a way around it.

 

[EasyPeazy]

Geez, guys. An increase (and a ridiculous one!) to WEBCASTERS is not a "blow" to terrestrial broadcasting, either analog or digital, any more than a rise in the price of milk is. What it IS is potentially the death blow to most INTERNET broadcasting...you know, the thing you've been telling us made HD "DOA".

I've been researching this. There are NO implications to traditional radio. It specifically excludes "established stations". Guys, that's AM and FM (and probably Sirius and XM as well). It has EVERYTHING to do with streaming by internet-only stations.

I'm an HD fan, and I take no joy in this. I LOVE radio, in all it's forms...including the internet. Potentially (there will undoubtedly be legal challenges) this is devastating to the very people who provide variety, who don't worry about ratings and charts...the little guy, who will be every more punished by success. I've stated before that it's possible for internet stations to bankrupt themselves with "success" due to the upward spiral of bandwidth costs for serving ever more people. Tack this on, and the "bankrupt yourself with success" obstacle ahead seems enormous. Here's hoping they chart a way around it.

Agreed. I take no particular joy in seeing streaming go away. Being the radio junkie that I am, I like being able to occasionally "tune in" to the webcast of a station hundreds or thousands of miles away from me.

As Mike said, this applies exclusively to internet streaming. As much as you anti-HD zealots wish it would apply to HD Radio, it doesn't. That's the bottom line. Sorry guys.

If an attempt were ever made by the RIAA to include HD Radio, radio as an industry could simply withhold all new music adds until they changed that position. It would take about 20 seconds. I spoke briefly with a rep from one of the major labels yesterday. He said he couldn't envision the RIAA ever doing that.

It's very simple - the recording industry NEEDS radio. If they didn't, they wouldn't spend millions each year attempting to get their records on our stations. Don't you guys read the news? Haven't you seen all the news lately about the various payola scandals? Payola wouldn't exist if the record labels didn't NEED radio.

 

[tankedsecondchance]

heres a article from ken dardis... has a link to the ruling

it comes down the crb claiming no information was presented to support lower rates ,its worth looking over


http://www.audiographics.com/agd/030807-1.htm

 

[vsa]

Mike Walker wrote: "...I've been researching this. There are NO implications to traditional radio. It specifically excludes "established stations". Guys, that's AM and FM (and probably Sirius and XM as well). It has EVERYTHING to do with streaming by internet-only stations..."

This applies to streaming by everybody. The negotiated agreements for Sirius and XM will most certainly be affected. The rates will be too high for almost all broadcasters.

The AOLs, Yahoos and satcasters of the world can afford to continue streaming until they have it all to themselves. A new monopoly. Later, they will get the rates lowered for themselves. 

There is nothing to prevent streaming satcasters from eventually offering wi-fi and wimax wireless, localized commercial radio formats online as a separate service to directly compete with radio.

Radio will be frozen out of the Internet. Even if radio can start streaming again later, they will be new entrants starting over from scratch for the third time.

Think about the implications of taking no sides today in this situation.