"we can say farewell to Internet radio."

[robear...@yahoo.com]

<<Internet Radio Suffers a Major Setback

Barry Levine, newsfactor.com Tue Apr 17, 1:36 PM ET

It might be curtains for Web-based radio, following the Copyright
Royalty Board's decision Monday to uphold its earlier judgment about
royalty rates for musicians and record companies.
On March 2, the CRB set the performance royalty rates that Internet
radio stations would need to pay for the years 2006 to 2010. A
coalition of Internet radio stations appealed the decision. But
yesterday's ruling by the CRB upheld its earlier decision. The CRB
also refused webcasters' request to stay implementation of the new
royalty rates until legal appeals were conducted.
The CRB did allow webcasters to use estimated tune-in hours to
calculate fees in 2006 and 2007, but only until they have time to
implement systems to track the music played.
A previous set of agreements had expired at the end of 2005. Under
those agreements, small Internet radio stations paid 12 percent of
revenues, rather than the per-song, per-listener fee required by the
new rules.

Starting May 15

Payment for the new rates would begin May 15. If a traditional radio
station streams its programming over the Internet, it would have to
pay the online rates in addition to its normal payments for over-the-
air broadcasting.
One small Net radio station, SomaFM in San Francisco, said that it had
paid about $22,000 in royalties in 2006, but that, under the new
ruling, it would have to pay about $600,000 annually. It said its
total annual revenue, from listener contributions, was about
$200,000.
SoundExchange, a nonprofit trade organization that collects and
distributes royalty fees from digital transmissions, called the
decision a victory. Executive Director John Simson said that artists
and labels "look forward to working with the Internet Radio
industry."
The American Federation of Television and Radio Artists similarly
applauded the decision, saying its members "deserve to be paid
fairly."

Webcasters' Coalition

A broad coalition of small and large Internet radio broadcasters,
including mom-and-pop outfits as well as Yahoo, National Public Radio,
and AOL, has objected to the new royalties. The broadcasters contend
that the new royalty structure will force many of them either to go
out of business or to cut back services.
"The CRB's ill informed decision to increase royalty fees to this
unjustifiable level," said Jake Ward, a spokesperson for the
SaveNetRadio campaign, "will quite simply bankrupt most webcasters and
destroy Internet radio."
"Particularly for independent artists," he said, "Internet radio has
the ability to reach millions of fans across the country who would
otherwise never hear their music." SaveNetRadio said that Internet
radio had 70 million listeners, and that it plays nearly four times as
much independent music as terrestrial FM radio.
David Oxenford, a lawyer who represents several of the webcasters,
said the broadcasters expect to file an appeal to the U.S. Court of
Appeals or the District of Columbia Circuit, which could take a year
or more. Some Internet radio stations are encouraging their listeners
to write Congress.
David Card, an analyst with Jupiter Research, said that it looked like
"we can say farewell to Internet radio." He suggested that only
companies that see Internet radio as a "loss-leader" to promote other
endeavors would likely remain in business. He said the Internet
probably won't include pure-play radio stations.>>