Webcasters who feared the worst -- that the U.S. Copyright Office would accept an arbitration panel's royalty-fee recommendations for Internet broadcasting, essentially killing the infantile industry -- got a reprieve this week. The office rejected the proposal and opted to set the fees itself in the next month.
Congress passed a law three years ago to force webcasters to pay performers and composers, similar to how songwriters are paid for radio play. (Radio stations never have had to pay performers, a fact that has long irked them and their record labels.) But webcasters and music-industry representatives couldn't agree on an amount, so the issue went to arbitration.
The three-member Copyright Arbitration Royalty Panel (CARP) had set a rate of .14 cents per listener per song, which webcasters claimed would equal more than 150 percent of the revenues they generate. Even with a reduced rate for nonprofit stations, Rollins College station WPRK-FM (91.5) reports that it would have had to fork over about $10,000 this year to simulcast online.
Since then, webcasters have protested CARP's decision with a day during which their stations went silent, and they have voiced their concerns in online and print publications. The copyright office apparently was listening.
The ruling isn't a complete win for web radio. There are no guarantees that the copyright office's findings will be kinder than CARP's recommendations. But, according to Radio and Internet Newsletter publisher Kurt Hanson, "The decision on an appropriate royalty rate seems to be in good hands."
Webcasters are hoping for royalties that are commensurate with their revenues, as opposed to a system of flat fees.