Friday, June 21, 2002

As some of you know, there's been a huge debate going on about the possibility of non-commercial web radio stations being forced to pay ridiculous royality rates to the Recording Industry Association (RIAA) - on the order of two cents per song per listener. An original proposal was squashed, but a revised proposal is just as bad and could spell the death of the one area in broadcasting where free voices and non-formated playlists could be heard.

WFMU, one of my favorite web radio outlets, is already considering what to do. Below is an email the station chief sent out, and I think it outlines the case well, plus it goes in exactly the direction I predicted months ago - arranging directly with independent record companies so that their releases can be spun royality free.

From: Ken Freedman
Date: Thu Jun 20, 2002 09:31:18 PM US/Eastern
To: The staff at
Subject: Final Webcasting Rates Set

The US Copyright Office today announced the new rates for what amounts to a new tax on webcasters.

It's bad news, but in classic FMU tradition, it could possibly help us in the long run.

I had been very optimisitic after the Copyright Office rejected what were called the CARP proposals on May 21st. But today, the same office came up with new rates that are extremely close to the original CARP rates. The top rate of 14 cents per listener per song (a rate that applied only to the AOLs of the world) was reduced to seven cents, but all the other key rates remain the same. The record keeping requirements were also simplified.

But as far as non-commercial stations go, the rates are still outrageous = two cents PER LISTENER PER SONG, retroactive to October 1998. Meanwhile, the rate that NPR stations have to be is still a big secret. It's presumably lower than what we will be expected to pay. That makes perfect sense, doesn't it - the stations that already get handouts from the government are the ones that get the break. Them that has shall get....

We discussed this whole situation at the last staff meeting, but here is what this will mean for us now:

We're not going to abide by these rates. We will go into quasi civil disobediance mode. Here are the main changes it will mean for us.

1) We will encode our archives and streams so that they cant be captured onto people's computers. This may not happen till mid July.

2) ALL DJs will have to start keeping playlists which include record label information, so that in the event that the RIAA manages to get us to pay someday, we can demonstrate the huge amount of material that we play which does not fall under RIAA jurisdiction. If DJs prefer not to POST their playlists to the public, that's fine. But we will need everybody to keep a full computer playlist. I'm really sorry to the folks who will be inconvenienced by this. Perhaps we can get volunteers to help out in this department.

3) We will start seeking written permissions from independent US record labels who give us permission to stream and archive their
material. For example, SpinArt, Telstar and Soleilmoon have already indicated they would do this. Hopefully we can generate a long list of such labels. Any case of a song from these labels appearing on our playlists will be one more song that the RIAA cannot collect their two cents per listeners per song.

Now, how do we stand to gain from this? It is possible that so many webcasters will now cease webcasting (while we will not), that we will gain online listeners.

More info and details coming soon,


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