Thousands of US Webcasters silenced their music streams on June 26 to protest a planned 300% royalty hike that could very well put the majority of them out of business. That day in 2007 may not go down in infamy in the course of world events, but it will be remembered by music fans.
As I mentioned in a previous post, the Copyright Royalty Board has decided to boost royalty rates paid by digital radio operators to artists’ rights group SoundExchange beginning July 15. Many Webcasters face the threat of permanent blackout posed by the extraordinarily high rates, since they exist primarily on listener donations rather than corporate or ad-backed dollars.
The June day came and went with some fanfare. Yahoo!, MTV Online, and Rhapsody were among the more notable protesters. News outlets and the blogosphere were both well saturated with musings about the protest. Popular indie music e-tailer eMusic even pledged a “modest” amount of support to the campaign. But what will it all really produce?
Unfortunately, licensing fees are and always have been part of any major Webcaster’s business, as Last.FM’s co-founder Felix Miller apathetically reminded us. (Easy for Miller to say. Last.FM just got bought by CBS.) While there’s definitely some truth to the statement, it’s just not reasonable to think that Joe-Schmo-Who-Webcasts-From-His-Garage can afford paying up to $700,000 in annual fees (the current rate is around $10,000).
Two bills that would better align royalty fees with those applied to satellite radio operators continue to work their way through Congress, but the odds that they get enacted are highly negligible. In the meantime, protesters continue to urge fans to call their Congressional representatives for some much-needed final-hour boost to the legislation.
In a music industry stripped of any hint of eclecticism, Web radio is the final frontier for fans and artists alike. It frightens me to think what it looks — and sounds — like after July 15.
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