Pure-Play Webcasters, SoundExchange Work It Out

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SoundExchange has now ironed out a royalty rate resolution with pure-play webcasters, according to details emerging Tuesday afternoon.

The resolution follows a protracted period of disagreement, though members of US Congress recently authorized discussion extensions by passing the Webcaster Settlement Act of 2009.  “More than two years in the making, this is an agreement we’re proud of because it shows that both sides can address the business concerns of the webcasters while giving artists and copyright holders the potential to share in the revenue growth of webcasters,” John Simson, executive director of SoundExchange, offered in a statement.

So what are the specifics?  According to information supplied by SoundExchange, the rates cover the term of 2006-2015, and 2014 for smaller webcasters.  It also covers commercially-released sound recordings covered by government statutory licenses, not just recordings administered through SoundExchange.

And, what exactly is a pure-play webcaster?  SoundExchange defines this as any broadcaster deriving an “overwhelming portion of their revenue from the streaming of sound recordings,” instead of a mix of terrestrial and online, for example.  The exact list of participants is now being formed, though according to the Radio and Internet Newsletter (RAIN), initial signatories are AccuRadio, Digitally Imported, and radioIO.

Other broadcasters can now voluntarily accept the agreement, including Pandora.   “Finally, for the first time ever, internet radio stations have a royalty deal that is reasonably viable and extends for a reasonably-long period of time,” stated RAIN founder and rate negotiator Kurt Hanson.

And what are these ‘viable’ rates?  The structure is tiered and full of “greater than,” “and/or,” and other stipulations.  Larger webcasters will be asked to pay 25 percent of overall revenues, or a per-performance rate of $0.00088, whichever is greater.  Smaller webcasters also have their own schedules, and a third class belongs to broadcasters with bundled, syndicated or subscription services.

More details on rates in the next story.