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Tuesday, Jun. 26, 2007 at 1:53 pm

Web Radio’s Day Off: Is it Over for Webcasters?

By Robert Gorell
June 26th, 2007

Today, Web radio stations everywhere–including WebMasterRadio.fm, home of our daily Blog Buzz podcast–are taking the day off to protest extreme royalty hikes for webcasters. The new rate hikes will be charged retroactively to 2006, making it impossible for a lot of Web radio pioneers to keep up. Regardless of your stance, the implications for webcasting and podcasting are huge.

eConsultancy.com has the proverbial CliffsNotes*, including this telling quote from AccuRadio’s Kurt Hanson:

“Under the judges’ decision, we owe $600,000 for 2006 — which is about 150% of our total revenues! That would absolutely bankrupt us and will force us to shut down. And that’s true for almost everyone who’s a stand-alone webcaster.”

Big players like MTV, Real/Rhapsody, Pandora, and Yahoo! Music are taking the day off in protest. Yet some refuse to be silenced.

TechCrunch reported that Last.fm won’t participate, suggesting that the move might create backlash from listeners–especially since Last.fm was just acquired by CBS [Disclosure: CBS is a client]. Perhaps the most popular social music platform, Last.fm defends their stance, insisting that, since they’re London-based, “this kind of legislation is not new” to them. They think you should make some noise.

Largely missing from the conversation (and please do correct me) is how this rate hike will affect traditional radio stations–particularly public radio stations, which have been huge supporters and early adopters of webcasting. So, not only does your favorite public and commercial radio stations have to pay the huge rates they pay for broadcasting on the airwaves, they’ve got to pony up for the Web to boot.

Anyone else find it, er, ironic that our same taxes that (barely) go to support public radio will now be drained even more by government regulation?

Former Minnesota Governor/pro wrestler Jesse “the Body Politique” Ventura famously said, “You can’t legislate stupidity.” Well, perhaps. But it sure doesn’t mean we can’t litigate our way into stupidity.

P.S. – For more information, visit SaveNetRadio.org.

P.P.S. – What do you think? Can Web radio survive? Should small-time webcasters pay the same fees as big radio stations? Should content be free?

[*CliffsNotes is a registered trademark of John Wiley & Sons, Inc. The views expressed in this post are solely those of its author, and do not necessarily reflect the views of John Wiley, his sons, or the corporation still operating in their name after 200 proud years of not only publishing the works of Edgar Allen Poe, Herman Mellville and the like, but being kind enough to abridge and decipher them into an easily digestible format for the slackers among us.]

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Comments (2)

  1. Its absurd to require a web radio station to pay such inflated royalties. There is no break for non-profit stations either.

    I think the music industry has become a bit overzealous. You cannot even download the composition of songs to play them on guitar now!

    On a brighter note in radio news, legislation allowing low powered community radio stations is looking hopeful.

  2. [...] congressional hearings, American webcasters have been spared. As we discussed a few weeks ago, podcasters everywhere united in a day of silence to protest royalty rate hikes that would have crippled Web radio in the United [...]

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