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RAIN 12/17: Webcaster industry group responds to new CRB royalty rates

Posted on: 12/17/2010


It’s not often the Digital Media Association (DiMA), which represents (among others) online music services, has positive things to say about the CRB following a new royalty rate announcement.

However, DiMA executive director Lee Knife yesterday responded to this week’s Copyright Royalty Board determination of royalty rates for the use of copyright sound recordings by non-interactive digital services for 2011-2015 (see RAIN coverage here and follow-up here).

“DiMA and our member companies are pleased that the Copyright Royalty Board did not adopt the extremely high rates proposed by SoundExchange,” Knife announced in a press release.

As RAIN reported (via David Oxenford in BroadcastLawBlog here) in setting a “$0.0019 per performance” rate for 2011, increasing to “$0.0023 per performance” in 2015, the CRB rejected royalty proposals from both SoundExchange (which collects and distributes the royalty rates) and Live365 (which litigated rates for commercial operators). SoundExchange proposed royalty rates starting at “$0.0021 per performance” and ending at “$0.0029 per performance” in 2015; Live365 proposed rates of “$0.0009 per performance.”

Knife couldn’t help but bemoan the steep increases webcasters have already seen (and, those that pay these new-announced rates will endure a 20% climb over the term).

“Over the past 10 years, webcasters have experienced a near three-fold increase in the rate they pay SoundExchange for use of sound recordings,” Knife said. “These dramatic increases have made it difficult for many webcasters to continue delivering the innovative services that millions of Internet radio fans have come to rely on.”

He repeated his organization’s call for rate parity when it comes to digital music licensing for non-interactive services across various media: “We are hopeful that in 2011 Congress will address problems in the rate-setting structure, and ultimately develop a system that enables all music radio services – internet, cable and satellite – to operate and pay royalties according to the same standard, applied under a fair set of rules.”

Read Knife’s comments in MusicWeek here.


Broadcasters have great, built-in advantages over Internet-only publishers when it comes to distributing content to audiences, says Norwegian Mobile TV Corporation CEO Gunnar Garfors. While the Internet can offer an unprecedented one-to-one, customized, and/or interactive media experiences, it likely will never be able to rival broadcast’s scalability, robustness, and security.

As such, the smart broadcaster will design distribution for both platforms — using broadcast or IP when the advantages of one or the other make sense for the content and the audience.

In a blog post, Garfors (who’s also President of International DMB Advancement Group) offers a list of 8 reasons why broadcast is still necessary. He concludes, “Combination is the new king. Combination of broadcasting and on demand content (the Internet), combination of content and services (when a return channel usually is needed, i.e. the Internet), combination of TV and radio and combination when it comes to partnerships between industries and even competitors. Not to forget a combination of technologies…”

This should certainly be seen as welcome news for the broadcast industry, which is in a unique position to be able to leverage both platforms. Read Garfors here.


Industry news source Digital Music News is “urgently” recommending online music companies follow the lead of interactive service Rdio and integrate with the Twitter platform.

RAIN reported here (via Hypebot, here) last week that with the new integration, when an Rdio member Tweets a song, other Rdio subscribers can listen to the full-length song inside the details pane (other Twitter users get a 30-second song preview).

DMN makes its case based on music-related Twitter stats from Twitter’s year-end recap (which you can find in the Twitter blog here). Consider: Five of the top 10 Twitter accounts are musical artists; 8 of the top 10 most re-tweeted messages of 2010 were from musical artists (#1 was from Stephen Colbert); musical artists were 3 of the top ten top-trending people; and half the top 10 trending TV topics of the year were music-related (4 award shows and “Glee”).

If you’re a webcaster or broadcaster, your job is to make your content easily accessible where it’s relevant, and wherever your potential listeners are. With more than 175 million registered users tweeting over 95 million times per day, Twitter (like Facebook) has obviously attracted a crowd. And there’s obviously lots of relevant musical discussions and trends there. How many of your listeners regularly use Twitter? Would they use your content more if it were seamlessly integrated with one of their favorite services?

Check out Digital Music News here.

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