ravetwodawn
05-15-2002, 10:42 PM
MAY 15, 17:25 ET
Fight Ensues Over Internet Radio
By JESSE J. HOLLAND
Associated Press Writer
WASHINGTON (AP) — A federal plan that could force Internet radio stations to pay high royalties on the songs they play would lead to the death of the emerging business, industry advocates said Wednesday.
``No one, neither the creators nor the webcasters, benefits from artificially inflated rates that only a few webcasters can afford,'' said Jonathan Potter, executive director of the Digital Media Association.
However, recording industry representatives told the Senate Judiciary Committee that musicians shouldn't subsidize webcasters by not being paid fairly for songs played on Internet stations.
``Webcasters can succeed while compensating the creators of the sound recordings upon which they have built their business,'' said Hilary Rosen, chairman and CEO of the Recording Industry Association of America. ``It is obvious that without sound recordings, there would be no webcasting business.''
Internet radio is becoming more popular at offices and homes as people get high-speed computer connections. It is expected to move more into the mainstream as wireless devices proliferate, allowing listeners to tune in while walking or driving.
At issue is a decision expected next Tuesday by the U.S. Copyright Office on whether to accept, reject or modify royalty rates for Internet-only broadcasters. The Copyright Arbitration Royalty Panel (CARP) has set the rates for Internet-only broadcasters at $1.40 per song heard by 1,000 listeners — retroactive to 1998.
No one is happy with that number, Senate Judiciary Chairman Patrick Leahy said.
``The recording industry and artist representatives feel that the royalty rate, which is based on the number of performances and listeners, rather than on a percentage of revenue model, is too low,'' said Leahy, D-Vt.
However, ``many of the webcasters have declared that this per-performance approach, and the rate attached to it, will bankrupt the small operations and drain the large ones,'' he added.
Leahy suggested that Congress might step in again. ``Why can't everyone, Congress and artists and labels and webcasters alike, take the CARP as a genuine learning experience and sit down and determine what is the next best step?'' he asked.
Traditional radio broadcasters are exempt from paying the new royalties, which would go to recording labels and musicians.
——
On the Net:
Digital Media Association: http://www.digmedia.org/
Recording Industry Association of America: http://www.riaa.org/
Fight Ensues Over Internet Radio
By JESSE J. HOLLAND
Associated Press Writer
WASHINGTON (AP) — A federal plan that could force Internet radio stations to pay high royalties on the songs they play would lead to the death of the emerging business, industry advocates said Wednesday.
``No one, neither the creators nor the webcasters, benefits from artificially inflated rates that only a few webcasters can afford,'' said Jonathan Potter, executive director of the Digital Media Association.
However, recording industry representatives told the Senate Judiciary Committee that musicians shouldn't subsidize webcasters by not being paid fairly for songs played on Internet stations.
``Webcasters can succeed while compensating the creators of the sound recordings upon which they have built their business,'' said Hilary Rosen, chairman and CEO of the Recording Industry Association of America. ``It is obvious that without sound recordings, there would be no webcasting business.''
Internet radio is becoming more popular at offices and homes as people get high-speed computer connections. It is expected to move more into the mainstream as wireless devices proliferate, allowing listeners to tune in while walking or driving.
At issue is a decision expected next Tuesday by the U.S. Copyright Office on whether to accept, reject or modify royalty rates for Internet-only broadcasters. The Copyright Arbitration Royalty Panel (CARP) has set the rates for Internet-only broadcasters at $1.40 per song heard by 1,000 listeners — retroactive to 1998.
No one is happy with that number, Senate Judiciary Chairman Patrick Leahy said.
``The recording industry and artist representatives feel that the royalty rate, which is based on the number of performances and listeners, rather than on a percentage of revenue model, is too low,'' said Leahy, D-Vt.
However, ``many of the webcasters have declared that this per-performance approach, and the rate attached to it, will bankrupt the small operations and drain the large ones,'' he added.
Leahy suggested that Congress might step in again. ``Why can't everyone, Congress and artists and labels and webcasters alike, take the CARP as a genuine learning experience and sit down and determine what is the next best step?'' he asked.
Traditional radio broadcasters are exempt from paying the new royalties, which would go to recording labels and musicians.
——
On the Net:
Digital Media Association: http://www.digmedia.org/
Recording Industry Association of America: http://www.riaa.org/