Internet Radio Goes Silent Tomorrow: Will You Be Listening?
In protest of a recent rate hike of 0.012 cents per song, per listener, from the current 0.007 cents rate (that's about 270% for you math gurus) by the US Copyright Royalty Board, the SaveNetRadio Coalition is staging a "day of silence" tomorrow. These rates are retroactive from January 1, 2006, meaning that net radio stations will owe back royalties for almost 17 months) and extend until December 31, 2010.
SaveNetRadio is calling July 15th "The Day the Music Dies," and while that may be a bit melodramatic, the rate hikes will undoubtedly knock many independent Internet radio stations down for the count.
Live365 predicts that the rate increase will shut up to 80% of its stations and reduce its 260 broadcasting genres to just 10. Last year, Live365 paid SoundExchange, the group that collects and distributes sound recording royalties, $1 million on behalf of its broadcasters, who pay an average of $60 to run their online radio stations. It is estimated that the retroactive rate increase will force Live365 to owe $4.2 million.
SHOUTcast, a software program used to stream Internet radio over the WinAmp media player, usually lists around 18,000 radio stations at any given time during the day (that number changes minute to minute as stations pop on and offline), and over 200,000 listeners. The vast majority of those stations would be forced to close, given the rate hikes (or operate illegally -- SHOUTcast leaves legal matters up to its users, so many of the stations may currently operate outside of the law).
SaveNetRadio hopes the day of silence will call the issue to the attention of listeners and urge them to act by writing to congressmen in the US in support of the "Internet Radio Equality Act." The bill, which is sponsored by Rep. Jay Inslee (D-WA), would overturn the decision by the Copyright Royalty Board and instead set the rate paid by webcasters for performance rights to the same paid by satellite radio, which is a percentage-of-revenue based scheme (currently 7.5%).
Independent net radio giant Live365 will participate in tomorrow's blackout.
According to Jake Ward, a spokesperson for SaveNetRadio, 14,000 Internet radio stations will go dark tomorrow, including big players like Yahoo!, Live365, Pandora, Rhapsody, and MTV, as well as a number of terrestrial stations that also broadcast online. Conspicuously missing from the list is CBS-owned Last.fm (as noted by Duncan Riley over at TechCrunch).
When we wrote about about the user response to CBS buying Last.fm in May, we noted that some users feared that CBS ownership would mean the site would get more "corporate." TechCrunch notes that CBS "has deep pockets and a much larger advertiser pool from which to cover costs under the new royalty scheme." But nonetheless I agree with their assessment that not participating in the day of silence may cause a user backlash. It certainly feels like a "corporate" move.
What do you think? Will the day of silence affect you enough to contact your representative (if you're an American)? Are the Internet radio stations fighting a losing battle against the lobbying groups for satellite and terrestrial radio? Also we're running a poll on this - see below.
Microphone image from Flickr user pfly.
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Last.fm is a British company so it's not affected by the US rate hike. I expect there will be a shift off-shore of net-radio stations.
@Ian #1: I've heard that argument a lot, but I don't believe it is accurate.
First, Last.fm, once the deal with CBS goes through, will become part of an American company.
Second, the law applies to them if they want Americans to be able to use their service (they would either have to pay the royalties or likely be forced to block US listeners from using their net radio service). One study pegs the number of Internet radio listeners in the US at 50-70 million/month. So I would imagine Last.fm might have a sizable US user base.
Although I don't regularly listen to internet radio, I fear that this signals a shift toward centralized control of the internet. As rates increase, the only competitors who will be able to survive will consolidate into a few powerful media outlets... sound familiar?
I'm a longtime user of Last.fm, and I don't view webcasting as their primary raison d'etre. I use them to track my listening habits when I play MY music on my COMPUTER. Most people, though not all, are Last.fm users for this reason.
I think the day of silence is a cool idea. I would appreciate the gesture if Last.fm joined in. But what kind of gesture is it for them, really? Webcasting is a big part of their business, but they don't have the same stakes as Live365, Shoutcast, or Pandora. Bottom line, yeah it would be a class move for Last.fm to join, but if they have business reasons for NOT joining, well that's their decision. I'm not going to get mad and use another, inferior service because Last.fm makes a business decision.
'playable search' to the rescue?
http://digg.com/music/Internet_Radio_Silent_Playable_search_results_to_the_rescue
Personally, I think this is the equivalent of Americans refusing to purchases gasoline for a day. It looks like it would work on paper, but in reality, it's a lost cause. I do think however, that giving users a taste of what it might be like without net radio may actually tip some users over the fence and actually get them off their butts to call their local representative, however, in most cases, I don't see this blackout as having any major effect to what may be coming down the pike.
I will truly miss Pandora if it goes under. I've only started using it recently and I love it. Now, the big bad record companies are going to take it away from us.
0.007 cents to 0.012 cents is a 71% increase. Not sure where the 270% comes from.
Sorry, I guess I wasn't very clear. It's an increase of 0.012 cents. I.e., right now it is 0.007 cents, and come July 15 it will be 0.019 cents.
I already contacted my state representatives on this issue a few weeks ago, and one of them, Patrick Murphy (D-PA) wrote back recently that he would be cosponsoring HR2060, the Internet Radio Equality Act. Not bad :)
Some people are doing a patition for this so all you internet radio fans just go on to urradio.com and click on "clickto listen" and it will say something
I noticed another problem with internet radio. Windows vista. Several sites i listen to work find on xp, 2000 but do not play anything on vista.
Yes, "Zip Drugs legal discount online pharmacy", I'm sure Windows Vista is a big problem for internet radio...
The whole thing is ridiculous. The rate should be the same as for satellite radio.
You'd think the idiots would figure out that by driving all of the Internet stations off of the air, they'd be losing all of those royalties they could be making if they stayed on.
Stupid, stupid, stupid!
This is hideous. This just goes to show the true greedy nature of the recording industry and its cohorts. They would certainly prefer less radio stations... anything to help them seed end to end market control like they had before the rise of the internet and digital distribution technologies. What scares me the most is archaic copyright law, put in place to guarantee revenue models, is ruling the internet.
Richard, I could not have said it better.
Cheers
it had past
Just a thought: Are artists/composers/performers legally required to have their intellectual property defended by one particular body? Or could a group of content producers decide to create their own alternative structure for collecting copyright fees? I believe that in a lot of niche markets (contemporary classical for example), it would make sense to "cut the middleman" to a certain extent, not only for the consumer, but also for the content owners themselves.
When will the laws, which then will regulate hosting fees and impose the requirement of licenses for ISP's , follow suite and put the rest of the Internet Commerce in the hands of the few, already known as the "Mainstream Media"?
Is not already clear which turn the Internet will take, without making it obvious to all, that defakto it is being shut down for the broad masses.
We are now beginning to understand what it means and how it feels when "Terrorists" prevail!
Ohh... and hang on Friends, it is going to get bumpier, much bumpier yet...
Good Luck ALL