Yahoo! and AOL may shut down their Internet-radio services, which have become a pricey proposition for the two online companies because of the 38% royalty increase mandated by SoundExchange. "Yahoo and AOL stopped directing users to their radio sites after SoundExchange, the Washington-based group representing artists and record labels, began collecting the higher fees in July.... As a result, the number of people using Launchcast fell 11 percent to 5.1 million in October, according to ComScore. AOL Radio users declined 10 percent to 2.7 million from 3 million." [Bloomberg]
Yesterday's deal between royalty-collection company SoundExchange and small Internet radio broadcasters has been met with scorn from a few prominent Webcasters, who say that a quirk in the deal means that they'll still have to pay out more money than they can afford:
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Small webcasters—those who make less than $1.25 million in annual revenue—have cut a deal with SoundExchange allowing them to pay only 10-12% of their annual income to the royalty-collecting agency. Radio stations have until Sept. 14 to sign up as a "qualifying small webcaster," otherwise they'll be forced to hand over a lot more money. [Contentinople]
When we last checked in on the Internet radio royalty debate, it looked like SoundExchange and the Digital Media Association (DiMA) were on the verge of coming to an understanding of sorts—last Thursday, SoundExchange said that as long as webcasters were better about reporting, and worked on a technologically feasible solution to stop stream-ripping (apparently, there are people out there who still do that. Who knew?), SoundExchange would allow radio stations to stream while new royalty rates were worked out. Or did they? A timeline provided by Listening Post outlines the back-and-forth the two organizations have had over the past few days:
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The fight to lower royalty payments for streaming radio stations isn't over by a long shot, but SoundExchange has agreed to revisit the issue—and, more importantly, it won't start enforcing the proposed higher royalties come Monday morning, so your favorite streaming station likely won't go away. (Yet.) [Listening Post]
U.S. Court of Appeals in Washington, D.C., denies Webcasters' motion to delay the July 15 royalty-rate hike, putting the ball for saving most Internet radio stations' streams in Congress' court. [Loudersoft]
Although the increased royalty rates for netradio stations don't kick in for another four days, a guy who runs a station playing nothing but Christmas carols (!) "and hundreds of other free Internet radio stations already have shut down." On the one hand, that sucks; on the other, who can listen to Christmas carols all day without gouging their eyes out? [LA Times]
It's been two days since the Internet radio day of silence, and today at 10 a.m. ET, the House of Representatives' Small Business Committee will hold a hearing about the Copyright Royalty Board's decision to raise royalty rates for Webcasters. RAIN has a breakdown of the witness list, which includes the general manager of WOXY on the anti-rate-hike side and the chairman of Tommy Boy Records opposing him. No word on whether or not this hearing will show up on any of the C-SPAN channels, but the committee does have a YouTube channel, so perhaps highlights will pop up as the day goes on.
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