If you switch on your favorite radio stream and hear something unusual — people talking about Internet policy, ambient sounds, or nothing at all — you’re getting a glimpse of a world that could be here by next month. To illustrate the devastating effect new US royalty rates could have on online broadcasters, broadcasters large and small are making today, Tuesday, June 26, a “day of silence.” They’re not just being dramatic: online broadcasters from public radio stations to big services like Rhapsody have said they simply won’t be able to swallow the new rates. Small broadcasters don’t have the money, and big broadcasters can’t justify losing money to shareholders. (Worse, the rates are retroactive, so this could really damage already-beleaguered American public broadcasting.)
Here’s why the rates are bad, and how to take action today.
New Rules: Bad for Music Creators
As many readers do, I believe in fair royalties for artists. Getting royalties from online broadcasters is good for musicians. But musicians need a rate that makes sense for them. This makes sense: “Give me 50 cents for each dollar you make off my music.” This does not make sense: “Give me three dollars for each dollar you make off my music.” You can debate the former figure, but by the time you get to the latter, the other party is going to simply drop you. And this isn’t an exaggeration, either. AccuRadio, RadioIo, Digitally Imported, Radio Paradise, and 3WK recently illustrated the millions they would owe in CRB Royalties, which increase the percentage of their income that go to royalties from 11% to around 300%. Public radio is in a similar boat.
For just one example, see CDM’s interview with Pandora’s founder.
And that, of course, assumes royalties are the main source of income for musicians, when the opposite is true. I’ve talked to musicians informally — some of them pretty high up the food chain — and gotten the same response. Their biggest income source is often things like live tours. The knee-jerk response of the Interwebs to music income is oversimplified, it’s true — pundits with no experience in trying to live off their music will just say, “oh, it’s publicity, it should all be free.” In fact, I don’t think musicians should have to give up royalties if they don’t want to: they own the music. In this case, though, it’s the worst-case scenario: give up the royalties and the exposure to new audiences (because these outlets will simply go away rather than pay such punishing fees).
I think there is a lot of good debate to be had around how to charge for music, how to promote music, how to define and protect intellectual property. In this case, though, the issue is so clear-cut I feel obligated to advocate for one side. We can’t have any of those other debates if we start out with a crippling rate that makes no sense. And even if you want Creative Commons-licensed music that is royalty-free, that music will take time to flourish; if you cut off the ecosystem before it can grow, it’s in trouble, too.
The Solution: Internet Radio Equality
Fortunately, today is not the day to just sit around and get depressed. Today is a day for action. For the reasons above, and based on your feedback, I believe most musicians and composers will support fair rules for royalties.
If you’re in the United States, call your U.S. Representative and your two Senators, and ask them to support the Internet Radio Equality Act. The Act would protect webcasters from unfair rates, and set a rate that benefits music creators and webcasters alike. And even if you’re not, you’ll find plenty of good resources — and you can help spread the word on your blog / site to people who are in the US.
Day of Silence at Radio and Internet Newsletter (Lots of links)
H.R. 2060 Full Text and Cosponsors (Check out the Internet Radio Equality Act for yourself. If you agree with it, take action. If your Representative is on the current cosponsor list, thank them. If not, encourage them to cosponsor and to support the legislation.)
D-Day for Webcasters Terrific coverage and discussion at KCRW Radio Los Angeles
CDMers for Internet Radio Equality
If you’ve contacted your Rep and Senators, leave us a note in comments and let us know what they say. We’ll keep a running tally through the day of how things are going for pro-equality CDMers throughout the US. And if you’re from around other parts of the world, feel free to post links to your commentary on your site here.