House tosses Web-casters a bone

Tolerable royalties halfway there

By Thomas C Greene in Washington DC • Get more from this author

Posted in Music and Media, 7th October 2002 23:54 GMT

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The US House of Representatives passed a bill Monday which would give financial relief to small Internet radio broadcasters threatened by recording-industry royalty extortion.

Rather than the industry's preferred per-play fee, the bill would assess costs based on the Webcaster's revenues. Those making less than $250,000 per year would pay ten per cent of revenue or seven per cent of expenses, whichever is greater. Those making between $250,000 and $500,000 would pay twelve per cent of revenue or seven per cent of expenses, whichever is greater.

In June the Library of Congress decided Webcasters should pay 0.07 cents per track per listener. The industry whinged that the fee was well below 'market value' as they liked to reckon it, but small Webcasters like college stations claimed it would wipe them out.

The new bill would not affect big Web outlets like Yahoo, AOL, etc., which will continue to pay according to the Library of Congress schedule, much to the chagrin of the RIAA. However it does impose a six-month moratorium on fee assessment. The Senate is expected to consider the bill in a week or so. ®

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