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RAIN 8/6: "Gulf" between viewpoints may stall royalty compromise, says Oxenford

Posted on: 08/06/2008

OXENFORD SPOTSGULFBETWEEN VIEWPOINTS IN SENATE NET ROYALTY HEARING: Industry expert and lawyer David Oxenford began his analysis of last week’s Senate Judiciary hearing on music royalties with “a glimmer of hope” from SoundExchange’s executive director John Simson (RAIN coverage here). However, in his continuing coverage of the hearing, Oxenford points out that two sets of drastically differing viewpoints may stall an Internet radio royalty rate compromise. The first “gulf” is whether Internet radio is, as an industry, booming or on the brink of destruction. Oxenford points out that Simson cited a study claiming Internet radio would be a $20 billion advertising market by 2020, while Pandora’s CEO Joe Kennedy argued the service would “die” if the CRB rates were not changed. Secondly, the relationship between Internet radio and artists was disputed. Simpson reasoned that in the digital age, where music “is not owned but merely listened to through various platforms,” fair royalties for musicians are vital to make up for failing record sales. On the other side was musician Matt Nathanson, who claimed that “the promotional effects of Internet radio was so great that he would prefer to give up some royalties to insure that Internet radio can become profitable and grow.” He blamed record labels for past injustices towards artists, not radio. Oxenford writes, “One can only hope that the gulf that was evident was just due to public posturing as, if it was not, there may well be an insurmountable differences between the parties that cannot be bridged in any settlement negotiations over the royalties that Internet radio pays for the use of sound recordings.” For his detailed analysis on the Senate Judiciary hearing, click here.

LAST.FM OPENS SERVICE TO JAPAN: Last.fm has announced that its on-demand and streaming radio services are now available to Japan. Additionally, through a partnership with with HMV Japan, Last.fm users can “click-through to purchase” music from HMV’s online store. For more, read Plug in Music’s coverage here.

SMULYAN: NET RADIO ON CELL PHONES, WHY NOT FM?: As Internet radio applications on the iPhone continue to make headlines, chief executive of Emmis Communications Jeff Smulyan is arguing for AM/FM receivers in cell phones. While this means the 226 million people who own cell phones would have access to terrestrial radio (assuming they all buy new AM/FM compatible phones), whether or not they’ll listen is open to debate. Cell providers are resistant as well. They prefer radio services that use the web, thereby forcing users to purchase data plans. “If you just put in a radio in a phone, what that will do is to take away from what the carriers are doing,” said research manager of IDC’s Wireless Communications Research Lewis Ward. He also points that more pressing to terrestrial radio is not how to pick up cell phone listeners, but how to fend off the threat of Internet radio on-the-go and in the car. For more, read Indy Star’s coverage here.

WI-FI ON DELTA FLIGHTS BY NEXT YEAR: Delta Air Lines announced Tuesday that they would offer Wi-Fi hi-speed Internet on its entire domestic mainline fleet by mid-2009. To access the Internet, customers will pay $10 on flights 3 hours or less, and $13 on longer flights. American Airlines is also offering hi-speed Internet on flights using Aircell (RAIN coverage here). For more, read Yahoo’s coverage here.

INTERNET BROADCASTING HIRES EX-BRIGHTCOVE EXEC: Internet Broadcasting has hired Libby Freligh as VP Product Marketing. Freligh was previously an executive of Brightcove, and before that at Macromedia. “With her extensive experience creating market-defining new technologies and solutions, Libby is the ideal addition to the IB team. Libby’s first task will be to leverage our highly optimized, proven architecture to develop and launch new products and solutions that meet the needs of today’s and tomorrow’s Web publishers and advertisers,” said Jeff Kimball, Internet Broadcasting’s Chief Operating Officer.

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