The recent decision by the Copyright Royalty Board to increase royalties for internet radio broadcasters has sent shockwaves through the industry. The ruling replaces the previous revenue percentage calculation with a per-track royalty rate on recordings, which could spell disaster for smaller broadcasters with modest yearly incomes. Many broadcasters are now fighting back, using a range of tactics to drum up support and encourage listeners to rally against the ruling.
One of the most effective ways to generate support has been through messaging on station broadcasts themselves. By appealing directly to dedicated listeners, broadcasters have been able to rally significant support for their cause. In addition, a new website, savenetradio.org, has been set up to encourage listeners to take action against the ruling. The site implores visitors to “save internet radio with less than five minutes of your time,” and encourages them to write to their congressional representatives to voice their opposition.
Letters to Congress can be effective in generating political pressure, but many providers are also taking their case directly to the Hill. During a recent hearing conducted by members of the US House of Representatives, RealNetworks executive Bob Kimball spoke out against the new rate structure. Kimball highlighted what he called a “serious statutory bias” against internet radio, contrasting the new rates with the more favorable rates enjoyed by satellite radio. He also warned that many small and mid-size broadcasters could soon face extinction if the new rates are allowed to stand.
Kimball’s concerns are well-founded, as the immediate impact of the new rates could be catastrophic for many broadcasters. Immediate royalty costs are a significant budget line item for most internet radio providers, and the new rates could push many smaller broadcasters over the edge. Without a significant change in the way that royalties are calculated, it is likely that many internet radio broadcasters will be forced out of business, leaving a significant gap in the market for music and other audio content.
In response to the ruling, many broadcasters are now calling on Congress to establish parity between terrestrial, internet, and satellite formats. They argue that the new rates unfairly discriminate against internet radio, and that a more level playing field is needed to ensure the survival of the industry. By making their voices heard and generating political pressure, broadcasters hope to persuade Congress to take action to protect their livelihoods and ensure that the industry can continue to thrive.
The fight for the future of internet radio is far from over, and it remains to be seen whether broadcasters will be successful in their efforts to overturn the new rates. However, the outpouring of support from listeners and the wider public has been heartening, and has demonstrated the important role that internet radio plays in the lives of millions of people around the world. As the battle continues, broadcasters and their supporters will be working hard to ensure that the voices of the many are heard above the clamor of the few. With luck, they may be able to secure a victory that will ensure the survival of the industry for years to come.