Dear United States Government: Please Don’t Kill the Small Webcasters

Small Webcasters: Doomed to Death?

The imminent death of Live365 probably marks the end of small webcasting in the United States.  But the scrappy group that started internet radio in the 90s has largely survived because of preferential, smaller webcasting rates, a ‘startup rate’ that is now being removed.

Part of the reason for the removal of the ‘Small Webcaster Settlement Act’ is that the incubator stage is well, completely over.  The scrappy pioneers of internet radio have largely been replaced by streaming radio giants like Pandora, not to mention Apple, Spotify, iHeartRadio, and a number of well-financed players.  Meanwhile, a podcasting resurgence has started to replace smaller internet stations, many of whom delivery clunky, hard-to-navigate collections that are less convenient to use.

Those bigger players are paying a lot more to content owners, even if they’re not profitable.   All of which raises the question: should the US Government and Congress save this embattled group, or would that simply represent a subsidy for an older, revenue-challenged technology?

The following is a petition to Congress being distributed by the Independent Small Webcasters, a group ardently fighting for lowered royalty rates (and their own survival):

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Opposition to Copyright Royalty Board’s decision on webcasting rates

Petition published by Independent Small Webcasters and their listeners.

Petition Background (Preamble):

The Copyright Royalty Board has handed down a decision after meeting behind closed doors with Pandora and coming to an agreement in reference to royalty rate increases that literally cripples any small webcaster anywhere in the United States of America!

In this agreement, it states that the rate is $0.17 per 100 songs, per listener, raising rates so high that it makes it unaffordable by any broadcaster anywhere.

While this bill HR1733 is good to force terrestrial radio to finally pay royalties which they had never done since the beginning of internet broadcasting, the original “Small Webcaster Settlement Act” ( SWSA ) has been eliminated making no provision whatsoever for hobbyist broadcasters who have no revenue to pay the outlandish fees that would be incurred upon them by the elimination of this agreement.

It also creates a monopoly which according to US law has been deemed illegal in the United States of America, allowing only major corporations like Pandora and iHeart Radio to control what is being heard on the internet.

For years, small webcasters have been paying royalty fees when terrestrial was not!  And as a thank you for all the years of trying to do what was right, to be lawful and pay royalties that artists worldwide have worked so hard for and deserve, the Copyright Royalty Board has decided only the wealthy should be allowed to broadcast, thus ending small broadcasters tiny businesses all over the USA.

Finally, this bill does not only affect the small broadcaster , but affects many businesses that small webcasters have supported as well thus eliminating literally MILLIONS of dollars of spending in business such as:

* Streaming Servers
* Chatrooms and servers
* Messengers
* Communities and servers
* Games
* Webhosting and servers
* Banner Hosting services and many other services!

For years small broadcasters have been paying licensing fees to stay legal on the internet, paying dues in appreciation for the hobby they so love.  They have all had a dream of one day climbing that ladder to make a name for themselves, to achieve success. Some didn’t have that dream, they just wanted to enjoy what they loved to do.  Now that dream has been stomped on, spat on, and kicked to the curb by the very people we entrust to treat us fairly.  It’s shameful, unjust and should be considered criminal because of the results of this decision being made.

It should not be allowed.

Petition:

We the undersigned oppose the decision of The Copyright Royalty Board to not include a provision such as the Small Webcaster’s Settlement Act of 2002 which allows for small webcasters to have the ability to pay affordable royalty rate fees.

The rates set are totally unfair to those who do not have the revenue such as the larger broadcasters like Pandora and iHeart.

We the undersigned ask that a provision be included in this decision so that thousands of small webcasters and their listeners and services they do business with may continue to enjoy the music and environment they have created and not be crippled by the Fair Pay bill, as it is not fair at all!

Sign the petition, here.

22 Responses

  1. LALAKER

    Aren’t you tired of these corporate prostitutes known as politicians that are ruining everything? They are the ones responsible for deregulating corporations so they could become monopolies and create massive amounts of poverty. We are reaching a point in time where paychecks and entertainment aren’t going to exist. Now they are planning to lower the drinking limit which is also going to help dissolve the music, bar, and ENT business. http://freebeacon.com/issues/feds-want-to-lower-legal-driving-limit-to-one-drink/

    Reply
    • Paul Resnikoff
      Paul Resnikoff

      Drunk driving enforcement is actually a complicated topic, though the issue seems to be improving in the 2000s. For starters, I think as a society we agree that drunk driving creates serious hazards on shared roadways, and is something we want to enforce against and stiffly penalize.

      Complicating the issue is that drunk driving is a major revenue-generator for many municipalities, which has led to moral hazard problems including extremely large fines that may not be appropriate, and a resistance to programs and systems that dramatically reduce drunk driving. There are very few programs that I know of that aim to reduce the sale of alcohol, which of course must be consumed before ‘drunk driving’ can commence.

      A unexpectedly great solution to all this is Uber (and Lyft), which have collectively helped to lower drunk driving incidents in many areas, according to the scattered reports I’m hearing. I’ve even heard of dramatically lowered rates in some regions, which sounds amazing.

      In a twisted way though, that’s actually bad news for municipal finances, which could be the reason for the more stringent law proposals.

      But at this stage, if I hear anyone getting a DUI, I immediately think: why the hell didn’t you just take an Uber you idiot!

      Reply
      • LALAKER

        I’m not referring to people who plan on getting drunk I’m talking about the people that want to go out socially for a few drinks and stay within the current limit. They are the ones that just aren’t going to go out as much because they’ll lose their freedom to drive within reason. Most people don’t even want to consider taking a taxi unless they are planning on getting drunk and that probably ain’t gonna change.

        Reply
  2. boo hoo - more people who don't want to pay...

    So more people who don’t want to pay musicians and songwriters… shocking…

    Reply
    • Please Educate Yourself

      Webcasters pay their share. Terrestrial radio pays NOTHING to the performer! Yeah…that’s fair.

      Reply
  3. Big Wally

    “Part of the reason for the removal of the ‘Small Webcaster Settlement Act’ is that the incubator stage is well, completely over. The scrappy pioneers of internet radio have largely been replaced by streaming radio giants like Pandora, ….”

    Yep. And that sucks. REAL radio dies and it’s goodbye real jocks and diversity…–>hello corp. conglomerate voice tracked tripe and algorithm machines.

    Reply
  4. Big Wally

    The “incubator stage” is FAR from over! Without a fair percentage of revenue category for existing as well as up and coming small webmasters; how will there ever be “the next big thing”. There simply should *not* be such a humongous barrier to entry that this recent ruling allows for…EVER!

    If nothing is done or offered to the small webcasters, then the ladder has been pulled up and the public at large loses big time.

    Reply
  5. Give Em A Break

    Author asked, “All of which raises the question: should the US Government and Congress save this embattled group, or would that simply represent a subsidy for an older, revenue-challenged technology?

    Answer = Yes! Congress and/or SoundExchange (if allowed) should make a distinction/allowance for “revenue challenged” small webcasters.

    Subsidy? Huh? Paul, that’s just plain insulting considering that terrestrial AM/FM stations continue to be granted a 100% subsidy on performance royalties! But hey, they only raked in over 20 billion last year so I guess they really can’t afford it….like so many small webcasters WERE able to do the past 13 years. #eyeroll

    Reply
    • Paul Resnikoff
      Paul Resnikoff

      Huh? Paul, that’s just plain insulting considering that terrestrial AM/FM stations continue to be granted a 100% subsidy on performance royalties!

      Terrestrial radio exemptions are a complicated discussion, with major differences between catalog tracks and newer releases. Mainstream radio has a major impact on artist and song popularity, which must be considered, while catalog tracks largely help the station (especially if the audience is older and already familiar with the older tracks).

      That said, I’d argue that if you forced major terrestrial radio stations to pay performance royalties, they’d start to immediately figure out ways to reduce that expenditure. We’re already seeing all-inclusive deals between major artists and radio conglomerates, but radio giants could decide to create and promote their own superstars (while controlling copyright over them).

      Or, shifting to talk radio! So, I’d be careful with this one if I were the recording industry.

      Reply
      • Give Em A Break

        “Terrestrial radio exemptions are a complicated discussion, with major differences between catalog tracks and newer releases. Mainstream radio has a major impact on artist and song popularity, which must be considered, while catalog tracks largely help the station (especially if the audience is older and already familiar with the older tracks).

        There’s nothing complicated about it at all Paul. “Major differences”? “Catalog tracks vs. newer releases”? That’s utter nonsense. Why should you pay royalties for listening via a web stream or app, but none at all for listening via the FM airwaves? You’re delivering the identical experience to both listeners. Does that really make sense to you?

        As for “major impact” on artists, the exemption for US broadcasters (successfully lobbied for decades ago by the NAB) is very much the exception to the rule globally, and prevents US performers from receiving reciprocal payments from European & Asian licensing agencies.

        Do your homework, rather than reflexively defending the status quo.

        Reply
        • Paul Resnikoff
          Paul Resnikoff

          I’m all for having a global outlook, but we’re a very large country with lots of unique differences. We should make laws that make the most sense for the United States, not because Sweden enacted it or ‘every other country’ has a law. And please don’t use the ‘North Korea’ card here, it’s just rhetoric that obscures that unique, actual issues at play here (theoretical, practical, and ethical).

          And if you choose to ignore the absolutely massive impact the terrestrial radio has on newer content, then you’re depriving yourself of a critical component of this debate.

          Now, yes, there are absolutely critical differences between catalog and current songs, and even more pronounced differences between current and deep catalog. Playing the Temptations on an oldies soul station largely benefits the station, because the audience is largely familiar with the track. These are songs the audience knows and loves, and substitutes for a CD-changer (yes, older people use CD changers). That’s not to say there aren’t subsequent purchases and interest, there are, but these listeners are, for the most part, not getting introduced to this content. You can even make the case that tightly-programmed, oldies radio playlists cannibalize actual purchases of, yes, CDs (or downloads), though these are very complicated analyses that have only partial data to apply.

          Now, shift over to a hip-hop station that starts playing ‘Hotline Bling’ when it first comes out. That has a very big impact on the success of that track, it’s introductory in nature. That impact is far higher around an unknown artist, with a new song. In this context, radio stations can be absolutely be make-or-break for certain songs and artists.

          Just look at the data. Traditional radio is one of the biggest places where people discover new music. It’s not what tech-focused, so-called ‘progressive’ people in this industry want to believe, but it’s factual. (The other big one is word of mouth). That’s not to say that internet radio doesn’t have an impact, but it’s not as substantial. It’s a different platform.

          Reply
          • Give Em A Break

            What does any of this have to do with making a differentiation between radio towers and cell towers? It’s the same content…it’s the same oldies station…it’s the same hip hop station! Please tell us, what’s the difference between a radio DJ in a Clear Channel studio vs. a radio DJ in his basement studio playing the same programming? Same content..same impact.

            You are aware that terrestrial broadcasters pay performance royalties for their simulcasts right? Using your stance and logic, how do you square that one Paul?

          • Paul Resnikoff
            Paul Resnikoff

            I’ll try to remember what I wrote last week… it was along these lines.

            Same content, same impact

            Not true. Both stations might be playing ‘Hotline Bling,’ but the impact is dramatically different. For example, if that it played on a major LA-based terrestrial radio station, you’d better believe the impact is hundreds of thousands of times greater (at least) than someone broadcasting from their Mac in Grand Rapids. It’s not even a comparison…

            And it’s not a comparison because they are totally different things! The platforms only share the name ‘radio’ in them, but the differences are dramatic. One is massively large and market-driven, with a blanket broadcast that goes over a massively large, heavily populated area; the other is selected by a small number, most of whom don’t care about a mainstream track anyway. I could go on and on.

            So, if they are different things, why should they be treated the same? Why not charge the small webcaster terrestrial radio minimum licensing fees, if you want parity so badly? Works both ways, my friend.

          • Give Em A Break

            Why did you delete your most recent rebuttal Paul? Interesting…..

          • Paul Resnikoff
            Paul Resnikoff

            Ha, no I definitely didn’t delete it, though yes it did get wiped. We’ve switched our entire backend server system this past weekend, and the db synch caused some recent entries to disappear. I’ll try to find it, or at least re-construct it later.

  6. Brad Hill

    This petition means well, but is infested with inaccuracies which detract from its credibility and effectiveness.

    “The Copyright Royalty Board has handed down a decision after meeting behind closed doors with Pandora…”

    The CRB does not meet behind closed doors with any of the Webcast IV participants.

    “…raising rates so high that it makes it unaffordable by any broadcaster anywhere.”

    A careless overstatement … terrestrial broadcasters, for instance, received a discount from previous rates. Even some small Internet-only webcasters are coping with the new rates in various ways. Besides this, the new rates aren’t the point. It’s the expiration of the Webcaster Settlement Act of 2009 which hurts small webcasters.

    “While this bill HR1733 is good to force terrestrial radio to finally pay royalties…”

    HR1733 has nothing whatsoever to do with this. It is unrelated legislation which addresses royalties for over-the-air radio. It should not be mentioned in this petition.

    “It also creates a monopoly…”

    It is not a monopoly. The author apparently does not know what a monopoly is.

    “…allowing only major corporations like Pandora and iHeart Radio to control what is being heard on the internet.”

    This is untrue, even as a rhetorical generalization. IN addition, Pandora and iHeart don’t control anything about this. If they did, they would have made the rates go down, not up. (They tried!)

    “…the Copyright Royalty Board has decided only the wealthy should be allowed to broadcast, thus ending small broadcasters tiny businesses all over the USA.”

    The Copyright Royalty Board has nothing to do with the expiration of the Webcaster Settlement Act, or the category of small webcasters. The CRB is not empowered to make side deals. The CRB did exactly what it was created to do — define a rate for commercial webcasting as a whole industry. The only entities that can propose side deals for special webcaster groups are SoundExchange and the music labels.

    “It’s shameful, unjust and should be considered criminal…”

    There is nothing criminal here. Fanatical rhetoric does not get results.

    “We the undersigned oppose the decision of The Copyright Royalty Board to not include a provision such as the Small Webcaster’s Settlement Act…”

    The CRB did not make any such decision, and is not authorized to make such a decision. The law was created by SoundExchange, and it expired. The CRB has nothing to do with it.

    “…so that thousands of small webcasters and their listeners and services they do business with may continue to enjoy the music and environment they have created and not be crippled by the Fair Pay bill…”

    Again, the Fair Pay bill has ZERO to do with this.

    “The rates set are totally unfair to those who do not have the revenue…”

    This isn’t exactly inaccurate, but it is wrong to invoke unfairness. Many industries have supply-side costs that prevent entry by hobbyists. In fact, most industries do. The point isn’t fairness. The point is what’s good for a vibrant, diversified listening ecosystem which pays more to labels than terrestrial radio.

    Reply

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