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Internet Radio Equality Act

If you have been following the saga of Internet Radio (webcasting/streaming audio, etc.), you already know about the Internet Radio Equality Act (HR 2060) , which was introduced into the House. It is briefly covered in a previous blog entry. As noted in that entry, I had some reservations about the portion concerning non-profits and in particular Educational Stations that are student operated (College Radio).

For various reasons, which I won’t detail, I didn’t offer more on the topic, except to say that I knew there was a Senate version of the bill soon to be introduced. A week ago Thursday the Senate version of the Internet Radio Equality Act (S 1353).

Both bills have the potential for being very positive for College Radio. They both change the rate setting standard that the Copyright Royalty Board (CRB) must use when setting rates. The current rate setting standard for sound recordings, as used by webcasters is a “willing buyer/willing seller” standard. This is in contrast with the standard used for musical works, which is a test of being “reasonable”. Without delving into the details, the difference is that the “reasonable” standard makes rates accessible to the user and offers a “reasonable” profit margin to the copyright owners, whereas, the willing buyer/willing seller standard compels the CRB to set a higher rate. So, the bottom line for College Radio is that both bills offer this same change.

Similarly, both bills would nullify the rate determination of the CRB. This creates a new problem. The rates for webcasters have already expired. The CRB rate determination (and law) acknowledged that fact and since the CRB rate determination was higher than the old rates, webcasters, according the CRB decision are not only facing new and higher rates going forward, but they, for the most part owe additional money back to when the previous rates expired, even though those webcasters already paid under the old rates. If the CRB decision is nullified, as proposed by both bills, then there must be a rate set for webcasters until new rates can be set under the proposed new standard.

The bills both propose the same rates for commercial webcasters (and broadcast simulcasters) during the interim (I won’t detail those rates here, but they are different from previous rates). For non-commercial stations (including religous, community, NPR and College), the House version proposes a 50% increase over the 2004 rates. For some non-commercial entities, this is not a problem due to the funding sources and the amount of the fees in 2004. To be specific, NPR stations had their fees paid under an agreement with NPR/CPB and the RIAA. The bottom line is that these stations (rather CPB) paid roughly $100 per year. An increase to $150 is not exceptional and apparently not problematic, particularly given the $500 minimum required under the CRB determination and the associated listening cap. For others, this increase, as proposed, could mean a rise from $500 to $750. This increase would be a much larger dollar amount from stations that don’t have their fee paid for them and have the smallest budgets.

The Senate version of the bill handles non-commercials a bit differently. The college stations AND others who participated in the SWSA would pay the same rates they previously paid until new rates are set under the proposed “new” standard. All other non-commercial stations, such as NPR, would see a 5% increase. While this does nothing to change the inequality between NPR/CPB stations and College stations, it does preserve the status quo until new rates can be set and it is much better than the house version for all non-commercial stations.

There had been an effort to include the same SWSA recordkeeping requirements in the Senate version of the IREA, but that language did not make it into the bill, as introduced.

This is what I suggest.

Both bills offer a potential long term benefit. The Senate version of the bill offers this benefit without ANY changes that would cause either the college stations, other non-commercial stations, copyright owners or artists to suffer any measurable loss of income or additional expenses. IF both bills pass, a committee would meet to try to iron out the differences between the bills and I am confident that non-commercials would benefit greatly from the outcome. Therefore, it makes a TON of sense to support both bills.

How? It’s relatively easy and definitely painless. Visit the SOS page or the Save Net Radio page and follow the instructions for calling your representatives. This takes all of 3-5 minutes! Call both your representatives and Senators! Be sure to tell them that you are supporting the Internet Radio Equality Act on behalf of College Radio and that if there are hearings, you want to see College Broadcasters present and that they deserve relief from the recordkeeping requirements.

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May 18, 2007 - Posted by | Rates, Recordkeeping, Webcasting

1 Comment »

  1. Keep up the good work.

    Comment by Charis | November 10, 2008 | Reply


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