WASHINGTON -- The performance-rights organization set up to collect digital performance royalties for artists and the record label trumpeted a deal it made with a handful of small webcasters on Tuesday.
While the deal with SoundExchange and two-dozen webcasters indicates progress on the politically sensitive issue, it also shows as much resistance as acceptance.
Under the deal, qualified small commercial webcasters -- those that earn less than $1.25 million a year -- would pay a royalty fee between 10% and 12% of revenue. Once webcasters passed the threshold and a usage cap of 5 million aggregate tuning hours a month -- a measure of music usage -- they would pay the full commercial rate. The deal will expire in 2010. SoundExchange claims that webcasters who qualify pay the same rate they did in 1998.
SoundExchange executive director John Simson said the deal gives small webcasters breathing space but still gives the artists and the labels something to take home.
"Giving small webcasters more time to build their businesses with below-market rates is something members of Congress wanted us to get done, and we have," Simson said. "We hope that these small webcasters will continue to provide innovative kinds of programming and a rich diversity of music."
The webcast royalty has been controversial since it was enacted by Congress, and the topic became a hot-button item after a panel of copyright royalty judges substantially increased the payment.
While the deal with SoundExchange and two-dozen webcasters indicates progress on the politically sensitive issue, it also shows as much resistance as acceptance.
Under the deal, qualified small commercial webcasters -- those that earn less than $1.25 million a year -- would pay a royalty fee between 10% and 12% of revenue. Once webcasters passed the threshold and a usage cap of 5 million aggregate tuning hours a month -- a measure of music usage -- they would pay the full commercial rate. The deal will expire in 2010. SoundExchange claims that webcasters who qualify pay the same rate they did in 1998.
SoundExchange executive director John Simson said the deal gives small webcasters breathing space but still gives the artists and the labels something to take home.
"Giving small webcasters more time to build their businesses with below-market rates is something members of Congress wanted us to get done, and we have," Simson said. "We hope that these small webcasters will continue to provide innovative kinds of programming and a rich diversity of music."
The webcast royalty has been controversial since it was enacted by Congress, and the topic became a hot-button item after a panel of copyright royalty judges substantially increased the payment.
- 9/19/2007
- The Hollywood Reporter - Movie News
WASHINGTON -- The federal appeals court here on Thursday rejected webcasters' request to postpone implementation of a new royalty rate for music they air over the Web.
The decision hands a court victory to the music industry and performers who have been warring with webcasters over the rate. By denying the webcasters' stay, the court let stand the July 15 "true up" date when they are required to give copyright holders a new, higher royalty payment for digitally delivered music.
"This is a major victory for recording artists and record labels whose hard work and creativity provides the music around which the Internet radio business is built," SoundExchange executive director John Simson said. "Notwithstanding this victory, we continue to reach out to the webcasting community to reach business solutions."
SoundExchange was created to distribute the royalty following the 1995 Digital Performance Right in Sound Recording Act. The royalty is split 50-50 between copyright owner, typically a label but sometimes the artists or other entities and the performer.
Webcasters had challenged the royalty, contending that a panel of copyright royalty judges erred when they dramatically increased the rate this year.
"Digital Media Assn. members and all webcasters are disappointed by the Court's decision and are now forced to make very difficult decisions about what music, if any, they are able to offer," executive director Jonathan Potter said. "The result will certainly be fewer outlets for independent music, less diversity on the Internet airwaves, and far fewer listening choices for consumers. We're hopeful that Congress will take steps to ensure that Internet radio is not silenced, and that webcasters and SoundExchange will find a way to compromise and maintain the diversity and opportunity of Internet radio."
The music industry and many artists organizations contend that the royalty is a fair payment for the products that drive consumers to webcasters' sites, giving them something upon which to build their businesses.
The decision hands a court victory to the music industry and performers who have been warring with webcasters over the rate. By denying the webcasters' stay, the court let stand the July 15 "true up" date when they are required to give copyright holders a new, higher royalty payment for digitally delivered music.
"This is a major victory for recording artists and record labels whose hard work and creativity provides the music around which the Internet radio business is built," SoundExchange executive director John Simson said. "Notwithstanding this victory, we continue to reach out to the webcasting community to reach business solutions."
SoundExchange was created to distribute the royalty following the 1995 Digital Performance Right in Sound Recording Act. The royalty is split 50-50 between copyright owner, typically a label but sometimes the artists or other entities and the performer.
Webcasters had challenged the royalty, contending that a panel of copyright royalty judges erred when they dramatically increased the rate this year.
"Digital Media Assn. members and all webcasters are disappointed by the Court's decision and are now forced to make very difficult decisions about what music, if any, they are able to offer," executive director Jonathan Potter said. "The result will certainly be fewer outlets for independent music, less diversity on the Internet airwaves, and far fewer listening choices for consumers. We're hopeful that Congress will take steps to ensure that Internet radio is not silenced, and that webcasters and SoundExchange will find a way to compromise and maintain the diversity and opportunity of Internet radio."
The music industry and many artists organizations contend that the royalty is a fair payment for the products that drive consumers to webcasters' sites, giving them something upon which to build their businesses.
- 7/13/2007
- The Hollywood Reporter - Movie News
WASHINGTON -- SoundExchange, the first performing rights organization collecting royalties for digital audio transmissions, is trying to cut deals with webcasters following recent decisions mandating increased royalties for Internet-delivered music.
SoundExchange executives contacted some services several weeks ago in order to seek information and schedule possible discussions and said Thursday that they are willing to meet with additional webcasters as well.
"Our continued outreach reflects our long-standing position that these are two businesses -- webcasting and creating music -- that are joined at the hip and need each other," SoundExchange executive director John Simson said. "We recognize that there may be certain needs and expectations, as expressed by webcasters in recent days, that might possibly be addressed through direct discussions."
On March 2, a panel of copyright judges, the Copyright Royalty Board, ruled that Web broadcasters must pay each time a listener hears a song at a rate that begins at 0.08 cents in 2006 and rises to 0.19 cents in 2010.
SoundExchange executives contacted some services several weeks ago in order to seek information and schedule possible discussions and said Thursday that they are willing to meet with additional webcasters as well.
"Our continued outreach reflects our long-standing position that these are two businesses -- webcasting and creating music -- that are joined at the hip and need each other," SoundExchange executive director John Simson said. "We recognize that there may be certain needs and expectations, as expressed by webcasters in recent days, that might possibly be addressed through direct discussions."
On March 2, a panel of copyright judges, the Copyright Royalty Board, ruled that Web broadcasters must pay each time a listener hears a song at a rate that begins at 0.08 cents in 2006 and rises to 0.19 cents in 2010.
- 4/20/2007
- The Hollywood Reporter - Movie News
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