SoundExchange Backs Down Before Congress; Webcasters Sigh Relief

I gotta be honest. I didn’t think it would happen. But it did.

The Web was abuzz with glee yesterday after news to do with a Congressional hearing, first broken to the world Thursday evening, filtered through to inboxes and RSS readers throughout the US – and even the world.

The topic of discussion at the congressional hearing was the rate hike(s) proposed months prior by SoundExchange. It was originally slated to be put into effect this Sunday. “Was” is the detail that has millions and millions of netizens and Internet radio broadcasters breathing a collective sigh of relief.

Yes, as was reported the evening of July 12th on Wired’s Listening Post blog, SoundExchange executive Jon Simson "made a startling statement.” In essence, the company, more or less one and the same with the RIAA (the Recording Industry Association of America), told all members of government and media present that it would not be instituting the rate hikes it has steadfastly pushed for publicly for months.

In the moments following SoundExchange’s decision to lose the aggression and mull things over some more (the company will still seek a change it rates, though they’ll likely work much more closely with Internet broadcasters big and small in order to ensure they don’t create a vacuum in the Web radio industry – which would indeed have been the result had the rate hike been put through come Sunday), Pandora founder Tim Westergren spoke to Wired and told of his waning optimism over the matter in the final hours before the hike. In gratitude to all Save Net Radio campaigners and other Internet radio advocates, he said, “This is a direct result of lobbying pressure, so if anyone thinks their call didn’t matter, it did. That’s why this is happening.”

Pandora is a popular custom Internet radio station service/creator.

What I can gather from the various articles and posts published on this reversal by SoundExchange is that all involved in the debate over any rate hikes will be starting back at square one. Any fees purportedly “etched in stone” will be taken completely off the table and all parties at the table will start talks afresh.

Interestingly enough, in an addendum to the original post at Wired’s Listening Post, author Eliot Van Buskirk stated that Congress seems to have removed the Copyright Royalty Board from future discussions on the matter. Instead, Congress itself will overlook negotiations between SoundExchange and Webcasters directly.

This is without a doubt a victory for Webcasters and their listeners. It just goes to show that if a group screams loudly enough, the rescue team (in this case, the US Congress) will have no choice but to come to its aid.