Here’s something you may not know. When you’re listening to streaming music over the Internet, that site needs to pay a compulsory royalty of 7/100 of a cent per song streamed. While this may not seem like a lot, it’s already more than is required of satellite radio, and not really comparable to terrestrial radio because of the inability to accurately measure the people listening. Back in March, a decision was made that would increase this rate to 19/100 of a penny per song streamed, almost a 3x increase in the price. In addition, under the current regime, small time webcasters can choose to pay a percentage of revenue, this element has also been removed from the system.
In simple terms, NetRadio is on death row. To recover those sorts of rates is pretty astronomical. Basically they’re asking for about $0.04/hr per listener, or $1/day per listener if you’re listening 24 hours a day. Extrapolating that out, you’re looking at $30/mo in just royalties needed per listener. That number does not include the cost of infrastructure. For an average listener who listens to NetRadio for a few hours a day at work, you’re looking at a rate around $5/mo for royalties. Youch, you’d be hard pressed to bring in that level of advertising revenue in the new scheme. As it is most NetRadio is barely making ends meet.
There’s another bigger issue going on here. Sites such as Pandora and last.fm provide a wonderful way to introduce people to new music. Without these engines, we’d be stuck listening to whatever things ClearChannel decides to ram down our ear canals. Either that, or we’d turn to P2P networks to “sample” the music and then never get around to paying for it. Well, I suppose another alternative is to give up on music all together. That’s something I’m not really ready to do.
Luckily, there are some good things coming related to it. In Congress, there is the recent introduction of H.R. 2060 - The Internet Radio Equality Act. The bill was just introduced yesterday by Jay Inslee of Washington and currently has no cosponsors. Without a whole slew of cosponsors, this thing stands little chance of surviving. So, it’s simple, get your representative to cosponsor the bill. Call them up and ask them to cosponsor the bill.
Here in Pittsburgh, I’m sometimes torn about our congressman, Mike Doyle. As of late, he’s been noted for his reference to Girl Talk in a house hearing. I’d hope that it’s a safe bet he’ll get around to cosponsoring the bill, but he has yet to sign on. According to his aide, a meeting between Doyle and Inslee is scheduled for next week to discuss the issue.