Pandora asking for help

Pandora, an online music station, is pleading to its fans across the Web for support in face of a new decision by US copyright officials that could put the company’s future, and other Internet radio services, in jeopardy.

I received a mass e-mail from the founder of the music service – which provides an automated selection of music based on the user’s preferences – asking to sign a petition “urging” congress to save Internet radio.

This comes in reaction to a decision by the US Copyright Royalty Board on Monday, that will lead to threefold the licensing fees for online music sites like Pandora and several of others.
(link: Wall Street Journal Online)

“The new royalty rates are irrationally high, more than four times what satellite radio pays and broadcast radio doesn't pay these at all. Left unchanged, these new royalties will kill every Internet radio site, including Pandora.”

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US Internet Radio

The missing link was to The SaveNetRadio Coalition.

Please note that the US Copyright Royalty Board has denied requests to appeal the decision.

While this is a US Copyright Royalty Board decision, it affects other jurisdictions such as Canada that are likely to accept similar legal theories of the activities. While regular radio is treated as a "communication to the public by telecommunications", Internet radio is being treated closer to the creation/distribution of a mechanical copy. While Tariff 22 deals with what the composer/publisher arm of the music industry will receive in royalties, we have yet to see details on what the performer/label will extract. It is quite possible that the Canadian situation will end up similar or worse.

This is different than traditional radio that only pays the composer/publisher arm, and pays no performance royalties to record companies or recording artists. While Canadian and US law are different in many ways, it is useful to read the Myths and Facts About the Cost of Webcasting from the site.

To see the type of mess that this conversation gets into, please see my past article Canadian Peer-to-peer (P2P) legal theories, proposals and questions.

This outcome should not have been unexpected. Given the long-standing legal problem with payola with traditional broadcast radio stations, the legacy major labels are worried that they will loose the control they have over the music industry with new media. By pushing themselves onto satellite and Internet radio they have been able to find ways to shut competing independent music out yet again by ensuring that only old-style Star-system radio can exist in any medium.

Free/Libre and Open Source Software (FLOSS) consultant.