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• Issue: How can the content provider be paid while supporting Internet radio?

Internet radio stations say they will be forced into bankruptcy by a proposed royalty rate that would suck up every dollar they make -- and then some. Example: Listen.com, Defining Digital music

The proposed charges are 0.14 cents per song*listener (as opposed to 0.07 for simultaneous broadcast on the Internet and radio). Excluding the "unfair" difference between radio broadcast, Symaltainious Radio and Internet, and Internet only, the mathematics seem to be as follows:

• 0.14 cents/ song*listener (3 mintue/song)
• *20 minutes / hour = 2.8 cents/hour
• *12 hours/day = $0.33 / day
• *30 days/month = $9.9 / month

Note: As of June 20-th, This is now changed to 0.7 cents for any Internet performance, reguardless of whether it be simultaneous or not, A step in the right direction.

Proposal:

1. That the rates certainly not be retroactive as this will certainly kill the low profit Webcaster business and that they be delayed for 6 months until a software system be developed to micro charge the end user for his use of digital and analog data, with different rates for analog and digital access. THE RETROACTIVE CHARGE WOULD SERVE MAINLY TO KILL THE INTERNET BROADCAST STATIONS AND THUS MUST NOT BE PERMITTED
   
2. That the rates for Internet Webcasters be equal to those for mixed and Broadcast only. It seems unreasonable to charge them twice as much to play a song as a mixed station and an infinite amount more than to Broadcast it. I would suggest that a rate of 0.07 cents per song listener be set for any Internet broadcast that could be saved in digital mode and zero for a a streamed playback that would only be available in audio
   
3. I would suggest that the Internet stations develop WITHIN THE 6 MONTH GRACE PERIOD, perhaps in combination with RealNetworks, a free player for Windows and Linux, that would be reasonably unbreakable, vie current crypto technology and frequent updates and would:

• Micro-charge a user for digital access to Audio/Video media, communicate this charge to some site that could then pay it out to the station and the Copyright holder.
• Micro-charge, though at a lower level, the user for analog access, The lower charge would be based on the royalty that a normal Broadcast station would pay.

Once this program was developed, the users could pay for their listening,

Note: I estimate that, even at the 0.07 rate, a month of digital access, 12 hours per day, would cost about $5/month, not totally exorbitant if the users could be charged and it was not retroactive, though I suggest it be cut much more for analog access.

Sites:

• Radio and Internet news
• Recording Industry Association of America (Webcase info page)
• Save Internet Radio Web

See:

• 'RIAA-written' Net radio bill served to Senate, By Andrew Orlowski, The Register (10/15/02)
• Bill may give webcasters royalty rate reprieve (09/27/02), InfoWorld, Scarlet Pruitt
  
• Plan to alter Internet radio (03/24/02), S.J. Mercury News, By Dawn C. Chmielewski,
• Patrick Leahy, Senator Vt, (mailto)

October 15, 2002 12:21