With a Saturday midnight deadline looming for controversial new Internet
royalty rates to take effect, webcasters and the music industry continued to
negotiate Friday afternoon to reduce the fee hike webcasters claim will be
ruinous.
Having already extended new offers to small and independent webcasters,
SoundExchange, which negotiates and collects royalties on behalf of music
labels and artists, now must deal with large webcasters.
Those webcasters have loudly complained about the March Copyright Royalty
Board (CRB) decision that would charge Internet broadcasters not only
increased streaming fees but also a $500 per channel fee. Webcasters like AOL,
Yahoo and Pandora have hundreds of channels.
Thursday evening, SoundExchange offered to cap the $500 per channel minimum
fee at $50,000 per year for webcasters who agree to provide more detailed
reporting of the music they play.
“We believe that this minimum fee proposal addresses webcasters’ concerns
about the minimum fee affecting webcasters with hundreds or even thousands of
stations,” SoundExchange Executive Director John Simson said in a statement.
The Digital Media Association (DiMA), which represents the large webcasters,
was unavailable for comment on the proposal.
“We do expect commercial webcasters like Yahoo and AOL to pay the new royalty
rates set by the CRB due July 15,” Simson said. “It is essential that
recording artists and content owners receive full and fair compensation from
the webcasters making use of their creative works.”
Simson also said that although small webcasters have not officially accepted
SoundExchange’s offer that would effectively keep their streaming fees at 2002
rates, “we continue to work with small and noncommercial webcasters and hope
that we will be able to resolve our issues as soon as possible.”
Also Thursday, U.S. Rep. Nydia Velasquez (D-N.Y.) introduced legislation to
stay the rate hike for 60 days to give SoundExchange and webcasters more time
to negotiate. Velasquez’ spokesman Kate Gilman told internetnews.com
that while the bill couldn’t be passed this week, Velasquez hopes to get the
measure before the House next week.
Earlier this week, the U.S. District Court of Appeals denied webcasters’ appeal for an emergency stay of relief. The court decision does
not preclude the court from ultimately ruling in favor of the webcasters. The
May appeal,
filed by DiMA, is still pending.
