Re: [ARSCLIST] Fw: WAMU 88.5 to Join Webcasters in "Day of Silence" June 26

["Steven C. Barr(x)" <stevenc@xxxxxxxxxxxxxx>]

see end...
----- Original Message ----- 
From: "Dismuke" <dismukemail@xxxxxxxxx>
> --- Bob Olhsson <olh@xxxxxxxxxxxxx> wrote:
> > These new "royalties" are only a 6% increase in the
> > CAP ON NEGOTIATED
> > ROYALTIES. They only come into play when the parties
> > can't reach an
> > agreement and a webcaster wants to go ahead and play
> > an artist's music
> > without an agreement.
---- 
> I do not wish to be impolite - but what planet have
> you been on?  The old statutory royalties for large
> commercial webcasters previously were .007 cents per
> song per listener.   The new rates from 2006 to 2010
> are as follows:  $0.0008, $0.0011, $0.0014, $0.0018,
> and $0.0019, respectively, representing an increase
> over the existing rate ($0.000762) of 5%, 44%, 84%,
> 136%, and 149%, respectively, and a year-over-year
> increase of 5%, 38%, 27%, 29%, and 6%, respectively.
> 
> Yes, somewhere in those numbers you can point to a 6%
> increase - but to do so is to evade context in a
> horrendously massive way.
> 
> And the rate increases do not end there.  That is only
> for large commercial webcasters who were already
> paying a per song per listener rate.  Under the old
> Small Webcaster Settlement Act, small webcasters paid
> a percentage of revenue so long as their total revenue
> was under a certain amount.   The new rates abolish
> the percentage of revenue and subject small stations
> to the per song per listener model.  There were
> several independently licensed broadcasters whose
> streams were carried by Live 365 who had been paying
> the $2,000 minimum per year license based on the fact
> that they had no revenue.  They knew that they would
> have a rate increase in 2006 - but they expected it to
> be an increase of the minimum annual fee by a certain
> percentage.  Suddenly, these webcasters, because of
> their listenership and the new per song per listener
> rates are looking at RETROACTIVE royalty rates of
> $40,000 and even up to $100,000 for their streams for
> just last year.   That is a heck of a lot more than 6%
> How would YOU like some organization that you do
> business with at $2,000 per year to suddenly hand you
> a bill of that size on a bill you had already paid
> LAST YEAR?   And how would you feel if the whole
> purpose of the endeavor was to throw you out of
> business in order to protect the technologically and
> economically obsolete rear ends of those in charge of
> that company on grounds that you represent a potential
> competitive threat?
> 
> Furthermore, the CRB rates also call for a $500
> minimum fee PER CHANNEL on all webcasters. 
> SoundExchange claims that this fee is necessary to
> cover "administration expenses."  Let's put that in
> context:  Live 365 has THOUSANDS of channels as what
> it does is aggregates thousands of small stations into
> its network.  Other services such as Pandora and
> Rhapsody also offer their listeners thousands of
> highly personalized channels.  With that $500 per
> channel fee, four of the larger webcasters, Live 365,
> Rhapsody, Yahoo and Pandora will end up having to pay
> a combined $1 BILLION in such fees - and that is on
> top of the per song per listener royalties.  By
> contrast, last year, SoundExchange collected a measly
> $20 million in royalties from ALL Internet radio
> stations combined.  So SoundExchange needs $1 BILLION
> in order to administer $20 million in royalties? 
> Heck, even the Federal Government is more efficient
> than that.
> 
> This is the sort of outrageous absurdity that you are
> actually trying to justify and defend.  I am sorry -
> but the rates are nothing short of INSANE.
> 
> >
> > NOBODY was paying the old cap rate and there's no
> > reason to believe anybody
> > is likely to be paying the new cap, especially if,
> > like you say, it would
> > bankrupt them.
> 
> Large webcasters WERE paying the full statutory
> royalty rates.  Smaller and non-commercial webcasters
> got a break last time around only because enough loyal
> listeners put up a loud enough stink on Capital Hill. 
> The new rates do away with those breaks.  
> 
> 
> > In many cases webcasters can get
> > permission to pay no
> > royalties at all when it is to the promotional
> > advantage of an artist.
> 
> 
> Well, it is true that webcasters do have the option of
> negotiating agreements with copyright holders directly
> - and there are a handful of stations that do that and
> avoid paying royalties.  But for the vast majority of
> stations, that is simply impossible. There are over
> 10,000 record labels out there.  Tracking down and
> getting all of the necessary paperwork is a HUGE task
> and a royal pain.  Few webcasters are going to even
> attempt it - they will shut down first which is
> EXACTLY what the RIAA wants.
> 
> The reason Performance Rights Organizations are
> necessary in the first place is because of the
> difficulties and impracticality of dealing with
> thousands of copyright holders individually - assuming
> that one can even make contact with them.
> 
> The only serious talk of negotiated rates is in the
> context of very large webcasters possibly negotiating
> a deal with the major RIAA labels at say 55% of the
> statutory rate.  That would be a HORRIBLE thing for
> artists because, under such a negotiation, artists
> would not be eligible for a cut as they are under the
> statutory rates which the record labels must split
> 50/50.  This would also be a horrible thing for small
> labels as they would not be in on such a deal - and
> webcasters who wanted to give their recordings airplay
> would ether have to pay the outrageous statutory rates
> or else negotiate on a label by label basis.  In
> practice, this would mean that only RIAA material gets
> preformed on the web - which, of course, is what all
> this is about.
> 
> 
> >
> > If you really like the new music you hear on
> > commercial radio, by all means
> > fight for a lower royalty cap. Bankrupting
> > independent new music is a sure
> > way to perpetuate lots more of the same.
> >     
> 
> 
> This is so exactly opposite to the truth.
> 
> At the very expensive rate of .019 cents per song per
> listener, the ONLY music that webcasters can afford to
> stream will be music that is WORTH .019 cents per song
> per listener in terms of attracting a large audience. 
> In other words, only the lowest common denominator
> type music will have a chance of getting played.  I
> can guarantee you that it will not be economically
> viable for a webcaster to stream Ukrainian folk music
> to a few dozen people at .019 cents per song per
> listener - it cannot attract a large enough audience
> to make it work.   That is why one does not find
> stations devoted to Ukrainian folk music on the FM
> band - the price of buying a station is too high for
> it to be viable.   The purpose of the high royalty
> rates is to artificially create the same sort of high
> cost environment on the Internet that exists on FM -
> an environment on which the RIAA labels depend in
> order to maintain their advantage over emerging competitors.
> 
Okeh...first, was there a loss of a digit, or a badly dislocated
decimal point, in your opening paragrah? .007 is actually LARGER
than "$0.0008, $0.0011, $0.0014, $0.0018, and $0.0019"...so should 
that be .0007, or are the new rated cited all one-tenth of what you 
should have cited...?

Second, this imaginary station playing old discs of "Ukranian folk
tunes" (which do, BTW, exist...!) would also presumably have a very
small number of listeners...so, unless there is a "minimum fee
payable" for the station (quite possible...) a listener-based fee
would probably be rather small! Say that there are 12 aging Ukranians
who "tune in:" the show regularly...the bill would be the per-
listener fee*12...am I right? Even if six more guys went to the
site by accident while looking for Russian porn (so any site using
the Cyrillic alphabet had to be visited...!) you are now up to
*18. Or is this in error?

Finally, would it be possible for "emerging artists" (i.e. me...!) to
sign something waiving all royalties due for "air" play? If so, this
could be a break for our sort...?!

Steven C. Barr