Bipartisan House Bill Would Nullify New Webcast Royalty Rates by Mark Hefflinger on April 26, 2007 – 1:29pm.

Washington – A bipartisan pair of lawmakers on Thursday introduced the Internet Radio Equality Act, a bill intended to nullify the effects of new, higher royalty rates recently set by the Copyright Royalty Board (CRB) that many music webcasters say will put them out of business.

Sponsored by Rep. Jay Inslee (D-Wash.) and Rep. Donald Manzullo (R-Ill.), the bill would annul the CRB decision and set royalty rates at 7.5% of webcaster revenues, the same rate paid by satellite radio providers. It would also change the rate-setting standard currently used by the CRB to determine Internet radio royalties to the same standard used for satellite radio, jukeboxes and sound recordings.

A number of webcasters, including the Digital Media Association (DiMA) and National Public Radio, filed motions for rehearing of the rates with the CRB, which the copyright judges denied.

“This bill may be Internet radio’s last best hope,” said DiMA executive director Jonathan Potter.

“The Internet Radio Equality Act sets a new standard for setting royalty rates that will level the playing field for Internet radio, avoid unfair bankruptcies that eliminate royalties currently being paid to recording artists and record companies, and removes the unfair advantage enjoyed by our competitors in the satellite radio community.”

“The CRB Board would not consider the public service aspect of more than 800 stations across the country when it made its recent decision,” said NPR spokesperson Andi Sporkin.

“But since 1976, Section 118 [of the Copyright Act] has recognized that public radio has a very different mission from commercial media and cannot pay commercial-level royalty rates. This bill will provide a long term resolution that is fair for all sides.”


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