Net Radio Day of Silence Today

Web radio stations all across the United States will be observing a "Day of Silence" today in protest of the U.S. government's intention to raise royalties to record companies and artists. The protest was organized by Kurt Hanson who publishes the Radio and Internet Newsletter. The participating stations want users to take note of what Web radio will sound like if they are driven out of business by the 300 percent increase in royalties they will have to pay if the raise goes through. The Copyright Royalty Board announced in March that they were going to switch stations from a per-song rate to a per-listener rate. According to an article by Eric Bangerman on ars technica (the art of technology) this raise will be retroactive back to early 2006 and it will double of the next five years. In a statement to Reuters Jake Ward of the lobbying group SaveNetRadio said: "These proposals will bankrupt the industry." SaveNetRadio has 14,000 members including Yahoo!, Viacom and RealNetworks.

Within Reason

The U.S. House of Representatives and Senate have versions of the Internet Radio Equality Act mandating a fixed royalty rate of 7.5 percent of total revenues but as of yet neither version has even reached the floor for a vote. Webcasters also asked a Federal Appeals Court to delay the rate hike which will go into effect July 15, but the court has yet to respond. One consolation was offered by SoundExchange where smaller broadcasters would be exempt for several years but SaveNetRadio exposed that as a simple prolonging of the inevitable destruction of Web radio.

Great Whale

This news combined with the Net Neutrality issues before the FCC and Congress reveal a shift occurring that many have expected. It appears to me that if traditional media and big business can't buy their way in or leverage their way into Web venues then they will simply bleed established entities to death and then take over with their own derivatives. The scene reminds me of one of those documentaries where thousands of sharks attack a disabled whale. As soon as some entity starts to do well the wolves move in for their cut, or should I say another cut?

My Take

Perhaps this is harsh but I get this mental picture of another rap star with an IQ of 25 driving yet another Bentley. These "stars" and their producers live like the royalty of pre-revolution France and thrive on the backs of working class people whose paychecks NEVER get raised 300 percent. This latest lunacy is either downright stupidity or an overt effort to destroy current Web radio outlets so that their market share can be taken up by a more industry "friendly" alternative. Just the estimated "administration fees" will cost the Webcasters an estimated $1 billion. This simply translates to reduced quantity and quality of listening and experience for all us little people on Web 2.0. 7.5 percent sounds pretty fair to me, I can't even get a savings bond to bear that return and the music industry doesn't even have to print a CD case.

SaveNetRadio artists welcome Congressman Jay Inslee and Congressman Don Manzullo

Credits: Top logo and photo courtesy SaveNetRadio