Internet Webcast Royalty Rates: The Same Old Story

It's old news by blog standards, as it happened last week, but the Copyright Royalty Board has announced the new royalty rates for webcasts. No surprise, they are higher than what your typical (if there is such a thing) small, non-commercial Internet radio station can afford, as cogently analyzed by the Radio and Internet Newsletter. And I'm not defining "afford" as in "turning a reasonable profit"; no, the analysis suggests that the royalty rate would consume total revenues of a "typical Internet radio station." Bill Goldsmith, the operator of the outstanding Internet radio station Radio Paradise, wrote a superb analysis of the impact of these rates on small, non-commercial Internet radio stations, and the public generally.

Of course, what is a typical Internet radio station? That is the question that should be answered in more reasonable negotiated rates that factor in the specific needs of different categories of stations (i.e., commercial/non-commercial, profit/non-profit). To potentially crush the most successful small Internet radio stations under these new proposed rates (explained here), and deter others from entering the market for fear that they could not ever meet the royalty requirements, should be an outcome that no one, not even the content industry, wants. But similar to Google Book Search, a project that is under attack by the very creators who benefit from the service but claim that they are being robbed and/or cheated, we now have a burgeoning technology and community being threatened by extremely short-sighted thinking. Sound familiar?

Let's start with a basic discussion topic for the royalty-seekers: maybe if more stations are allowed to grow, develop and flourish, then one day they might be able to afford higher rates. Or should rates be demanded now that will kill the industry? Please discuss among yourselves, and let the rest of us know the outcome.

There is some time to impact what is to come: look here for more information if you're interested. [Note: This entry is cross-posted at Hearsay Culture].