LowPayDJ said:
I know plenty of small internet radio operators, and NONE of them pay. None! Only the big operators pay. And that is because they are the only ones that can afford to pay.
Over
ten thousand small webcasters are broadcasting legally via Live365, SWCast and LoudCity. So I have to dispute the notion that only the big operators pay. Coverage for small stations at outfits like those start out at about $30 a month. That's more affordable than the penalty for operating illegally, and most hobbies cost a little money anyway.
Sure, there will always be webcasters who choose to fly under the radar and operate without paying royalties. They know the risks they are taking and if they're just broadcasting privately to a group of buddies, chances are they won't ever get caught.
But the average webcaster presumably wants to attract listeners and it's hard to do that while also staying invisible to the Performance Rights Organizations.
The real issue, IMO, is that the new rates determined in 2007, barring any settlement that may still materialize, are so high that no webcaster can afford them. The notion that any internet radio outfit broadcasting to just 1000 people at a time should pay quarter of a million dollars annually to the labels and artists is economically ludicrous. How that flawed math escaped the CRB and Congress still just stuns me.
To understand how I arrived at the $250,000 number for 1000 listeners, here's the flow...
15 songs per hour avg X $0.0019 per song per listener (2010 rate) = $0.0285 per hour per listener
24 hours in a day, 365 days in a year...
$0.0285 x 24 x 365 = $249.66 per listener per year.
1000 listeners at $249.66 per listener is $246,660 annually
By terrestrial standards, and audience of 1000 is miniscule. The new rates are ridiculous, which is why negotiations continue between webcasters and SoundExchange to find a reasonable solution.
And to address the original question on this topic, yes - it is possible to stream without paying royalties legally. Either be a talk radio operation, or obtain releases from the copyright holders (artist, label, composer, songwriter, etc) for each work you play.