Good news for indie radio and bad news for webcasters

by Jason Gross

9 March 2007


While it’s understandably a source of celebration that major radio conglomerates are paying up for their pay-offs, for some reason, I’m not too optimistic that they’re going to play clean from now on, especially given their track record.  Start with these stories detailing the settlements:

Broadcasters Agree To Fine Over Payola

Payola pact could boost airplay for indie music

Even there, you’ll notice some skepticism that the broadcasters will find some way around this by not giving indie music prime time slots or loosely defining what “indie” means.  It’s kind of the same problem that the FCC busted Univision over recently when they played fast and loose with what constituted “educational television” that they were required to broadcast- they showed cartoons to fill in this gap and obviously, that doesn’t cut it.  Like I said, don’t be surprised to see this repeated again with the payola settlement.

And then there’s the very troubling rate increase that might shut down internet radio as we know it.  Soundexchange, the RIAA’s (and by proxy, the major label’s) company to set rate made an six to twelve percent increase in the cost that they charge per listener for the music the stations are allowed to play:  Royalty Hike Panics Webcasters.  That can add up to so much money (and be retroactive for years) that stations won’t have the funds to cover it anymore.  The end result would be that the stations won’t be able to afford to play music anymore.  And here we have yet another example of a greedy industry stupidly trying to squeeze money from other sources and managing to quietly kill off support of legitimate product (just like the lawsuits and DRM have managed).  A chilling prediction from the Wire article linked above: “If the new rates stick, online music fans may come to expect far less innovation, variety and quality when it comes to internet radio. Some industry experts fear that even more users could be driven to illicit services that pay no royalties or those that operate from other countries.”

Though congressional hearings are pending, you can also make your own voice heard about this tragic idiocy: Save Internet Radio petition.

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