Internet radio crisis: Newsweek's coverage

Over at Brian Braiker writes:
As you read these words on your monitor, there is a decent chance that you’re also streaming a little online radio. After all, with an estimated listenership of approximately 50 million Americans per month, Internet radio has become a go-to destination for a fuller spectrum of music, an alternative to FM’s mind-numbing monotony. And if you are one of those listeners, mark May 15 on your calendar: it might well be the day that the music dies.

Last month the trio of Library of Congress judges that oversees copyright law’s statutory licenses decided that May 15 will be the date royalty fees owed by Web radio operators will be recalibrated. The Copyright Royalty Board changed rates from a percentage of revenue to a per-song, per-listener fee–effectively hiking the rates between 300 and 1,200 percent, according to a lawyer representing a group of Webcasters. "If this rate does not change, it will wipe out the vast majority of Web radio," Tim Westergren, founder of the music discovery service Pandora, tells NEWSWEEK. "If this stays, we’re done. Back to the stone age again."

Link. Photo above, David Byrne (Radio David Byrne Link). "You may ask yourself, where is my Internet radio?" (Erich Schlegel / Dallas Morning News-Corbis)

Previously on BoingBoing:

  • Internet radio crisis: an overview, from SomaFM's Rusty Hodge

    Reader comments: Ben says,

    The actual text of Rep. Jay Inslee's bill to "Save Internet Radio" is here: internet_radio_bill_april_2007.pdf. I'd suggest everyone contacting their representative and urging him or her to support the bill.
    Marty Z says,
    To make it easier to contact your representative, the SaveNetRadio coalition built this terrific site that includes the ability to quickly lookup the phone # for your representative and also includes talking points. This an urgent matter and I hope all BoingBoingers will participate in saving Net Radio!
    Eric says,
    Just sending this as a FYI. I received this back from Sen Feinstein's office in reponse to my submittal to
    (Ed note: Full text of Senator Feinstein's response after the jump. Short version: webcasters, feel free to crawl off and die.)

  • Dear XXXXX:

    Thank you for writing to me with your concerns about the Copyright Royalty Board's recent decision on the statutory rate for music webcasting. I understand your concerns and appreciate the opportunity to respond.

    Under the Copyright Royalty and Distribution Reform Act of 2004, Congress - at the behest of webcasters - created the Copyright Royalty Board which consists of three judges. By law, the judges are a venue of last resort and are required to periodically set rates for various statutory copyright licenses in the event that webcasters and copyright owners are unable to reach voluntary agreements. In the absence of an agreement, the judges set a rate designed to approximate the fair-market value that webcasters should pay to artists and performers for streaming their music for the years 2006-2010. The new rate that was established is less than a 5 percent increase of the rate in effect from 1998-2005.

    Although a few webcasters have recently claimed that the process was unfair, it was not arbitrary and allowed representatives from all sides to make their cases. The judges began the proceedings in 2005, and heard testimony from dozens of witnesses and conducted a comprehensive review of tens of thousands of pages of evidence submitted by all interested parties over an 18-month period.

    While some webcasters may choose to pay this rate, independent negotiations between the parties are still possible and this new statutory rate would serve as the ceiling. Additionally, if it appears that the new rate will reduce the overall amount of webcasting - as well as the overall income from this stream of revenue - the copyright owners may still have an incentive to offer webcasters a rate less than the statutory rate.

    I am a strong believer in intellectual property rights and believe that artists and performers have earned the right to be fairly compensated for the broadcast of their works by webcasters who benefit - financially and otherwise - from their talents. Without fair compensation, these artists would not create their works.

    Once again, thank you for writing. Should legislation addressing this new rate or the rate-setting process come before the Senate, I will be sure to keep your concerns in mind. In the meantime, if you should have any additional questions or comments, please do not hesitate to contact my Washington, DC staff at (202) 224-3841.

    Sincerely yours,
    Dianne Feinstein
    United States Senator

    Further information about my position on issues of concern to California and the Nation are available at my website You can also receive electronic e-mail updates by subscribing to my e-mail list at

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