Proposed Law Would Reverse Internet Radio Royalty Rate Hike

from the sensibility-prevails? dept

Earlier in the week, we noted how difficult it was to come up with “good” internet laws that politicians had enacted. Perhaps we should do that more often, as since then, legislation has been proposed that would overturn the pointless ban on online gambling, while now, two congressmen have introduced a bill that would overturn the recent decision of the Copyright Royalty Board to drastically increase internet radio royalty rates. The CRB rejected webcasters’ appeal of those new rates (which were pushed through by the RIAA). The bill sets compromise rates that would be significantly lower for most, if not all, net radio programmers: 7.5 percent of revenues “directly related to” its broadcasts, or 33 cents per hour of recordings transmitted to a single user. The original article says the law would also apply to “satellite and cable radio” broadcasters, but it’s not clear if that extends to companies like XM and Sirius, which are locked in fight with RIAA over the level of royalties they pay, with the industry group wanting 30 percent of their revenues. Obviously the bill’s a long way from becoming law, and the RIAA is sure to send its lobbyists to visit its friends on Capitol Hill to see what they can do. While it’s nice to see these good internet laws, it’s too bad they all seem to exist solely to reverse bad ones.


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Comments on “Proposed Law Would Reverse Internet Radio Royalty Rate Hike”

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18 Comments
glitch says:

i no longer own a radio in my house

and i have no intention of getting another one.

i also am not against paying for the music i like on internet radio.

i am not interested in adding to the bottom lines of RIAA, NAB, Clear Channel, or even Live Nation.

I dont turn on the radio in the morning to lisen to the 3 DJ’s complaining or bragging abiout the parenting.

i’ll pay to listen to what i like, and won’t take what others want to push, even for free.

Ron Larson (profile) says:

Why is the government involved?

I don’t understand why the government is involved in setting prices. That is usually NEVER a good thing.

Simple supply and demand will take care of this. If the producers charge too much for their product (music), then the customers will either find cheaper alternatives, or not use it.

This is simply an issue between a vendor and a customer. Can someone please explain to me why Congress is now involved?

Davey says:

Re: Why is the government involved?

Ron, there is no “market”. RIAA is treating one segment differently than the others with no justifiable reason. On the one hand they have a long history of bribing the big stations to play their crap, and now they want to starve out the little guys. That keeps them in control of what is heard by the American audience.

The economic role of government is to keep real competition alive. When pirates like the RIAA bribe their way to monopoly status, it is up government to bring down the hammer.

Shivers says:

Why congress is involved...

They are involved becauce the RIAA and the CRB were in bed with each other. They raised the royalty of one song to be played on the radio or internet radio from $.09 to I think something like $.19. This would kill almost all indie net radio stations while crippiling the big ones. So, the govn’t had to get involved to right another RIAA injustice.

Carlo (user link) says:

Re: .33 cents not 33 cents

The bill proposes a rate 0.33 cents per hour, not 33 cents per hour. That’s a huge difference to us broadcasters!

Michael, thanks for the comment — I haven’t seen the .33 cents per hour figure mentioned anywhere, but the 33 cents figure has been repeated many times. However, Thomas.gov doesn’t seem to yet have the actual text of the bill (HR 2060, apparently), and I’ve not been able to find it elsewhere. But I’ll keep checking.

DV Henkel-Wallace (profile) says:

not to be too cynical, but

There’s an incentive to pass a bad law and another to undo it: each law appeals to a different constituency so that both legislators can appear to have “done something”.

Plus now we’ve decided that legislative battles will continue into the courts regardless of what is passed, the incentive to do a good job is diminished.

Davey says:

Not good enough

This proposal is progress, but doesn’t address the real issue. There is no reason the RIAA pirates or anyone else should be able to exert monopoly/bribery power to treat one customer differently than another. The law should mandate that royalties must be the same for all broadcasters, whatever the means of transmission. There’s no justification whatsoever for this legalized discrimination except RIAA’s psychotic greed. It would be hard to find a clearer example of one group using the law to promote it’s narrow interests over those of the vast majority of a society.

When you contact your congressperson, ask them to amend this law to require equality for all broadcasters. Anything less is an assault on American free enterprise.

Dilbert says:

RADIO =CLEARCHANNEL = MOST MUSIC VENUES

UGH as if music doesnt’ suck enough on the radio clearchannel has to control music venues too.
Whenever you listen to the “different” radio stations bear in mind you are probably having mindsex with a clearchannel programmer because they own most of your radio stations. Period.
Ugh.

Now THAT’S the problem- and the greedy bastards at RIAA need to come clean on how they rip off artists through illegal sales overseas that aren’t reported back to the artist for royalies owed, the other numerous and varied scams they run on artists etc.. most artists would rather not speak up as it can be career suicide.

A chicken passeth by says:

While the proposal will definitely do some good, I’ll have to say that THIS IS THE STUPIDEST WAY TO HANDLE A SITUATION LIKE THIS. EVER.

Why in the blue heck are you guys agreeing to ADD ON to a bullshit law rather than demand its complete and utter removal?!

Jeez, I swear you guys give the government so much power that you don’t even realise, even with this contrived “patch” in place, $0.33 is still greater than $0, so the idiots in the IP industry are still earning a free check, for no effort whatsoever.

THE POINT IS NOT TO LET THEM DO THIS. A COMPROMISE DOES NOT REVERSE ANYTHING!

Once again, you’ve fallen into the “lesser of 2 evils” trap that your government uses…

William Zack says:

Poor attention to detail

I wonder if these individuals (and I am guessing it is mostly lawyers in the business) realize that the entitiy they are trying to pass these U.S. regulatory hikes on is the world wide web (hence the “www” in many adress lines). All this is going to do is drive internet broadcasters to nations much friendlier to the practicies of internet broadcasting and out of reach of U.S. jurisdiction. Then again, maybe Japan and Germany need the financial boost in their economies (as if we haven’t given up enough to the world). I already get broadcast from sites in the U.K. that I used to get from U.S. sites. If you don’t believe me, just remember the rush about 10-15 years ago big companies made to put their corporate headquarters overseas to rake in the billions of dollars in tax shelters they would have paid stationed in the U.S.

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