Save Internet Radio Initiative
2002

 

In 2002 there was an appeal to radio listeners.

Contact your Representative and Senators to save Internet Radio!

To send a fax, please fill in the simple blanks at the bottom of this letter. Three letters will be generated for you with the wording below. The letters will be faxed to your House Representative and two Senators.

Valued Listener:

Thank you for taking a moment to preserve your access to the kind of Internet radio that you are listening to right now.

Recently the Copyright Arbitration Royalty Panel (CARP) that was appointed by the U.S. Government Copyright Office, at the prompting of the Recording Industry Association of America (RIAA), recommended new and burdensome royalty payments on Internet radio broadcasters. These royalties do not apply to traditional broadcasters of AM and FM radio, so they represent a direct attempt by the RIAA to drive Internet radio out of business. For some reason, they believe that Internet radio is a threat to CD sales, even though they also believe that broadcast radio represents free advertising.

You can read more about this ruling, issued by the Copyright Arbitration Royalty Panel (CARP) at www.saveinternetradio.org.

These royalty costs far exceed our actual income let alone any profit. They are also retroactive to 1998. This means that most stations are facing massive "past due" bills for everything they have ever played to listeners like you in the last four years. In simple terms, this misguided ruling by the panel will bankrupt most Internet radio stations. At best, a few deep-pocket corporations will continue to serve music over the Internet. Since these few corporations will dominate the market, the variety you have come to love will disappear in favor of high-profit "Top 40" formats.

There is still hope. On May 21st, the Librarian of Congress rejected the CARP panel's ruling. Now, the future of Internet Radio hangs in the balance as we await a revised ruling from the Librarian himself. By law, the Librarian must issue this ruling by June 20th, so time is short. You can influence this process by sending a fax to your congressman and your senators (because the Librarian of Congress reports to them - they are his "boss"), but you must do so today. To help you, we have set up a free fax service that will do this for you. All you have to do is supply us with your name and address so that we can automatically determine who represents you and send them a fax. You will have a chance to view the fax to make sure that you agree with what it says. We will need to retain your personal information in order to prove that the faxes sent to congress are from real people. However, we will not distribute your personal information for any commercial purpose. It will be used solely as a part of our effort with the US Congress to ensure a fair royalty rate for Internet Radio.

Please help us stay in business, so that we can continue to serve you!

Sincerely,
[Your Internet Broadcaster]

Only the first stage is complete!

Make sure Internet Radio lives! You have until June 20th to make sure the Librarian of Congress knows how you feel. 

Click Here

Click on the banner above to read more and to send a fax to your congressional representative to help save Internet radio broadcasters.

Encourage your legislators to urge the Librarian of Congress to make a royalty rate decision that will be financially fair for webcasters and keep them in business.

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Contact your Representative and Senators to save Internet Radio!

To send a fax, please fill in the simple blanks at the bottom of this letter. Three letters will be generated for you with the wording below. The letters will be faxed to your House Representative and two Senators.

 

Sample letter:

 

Your Name
Street Address
City, State

Representative/Senator [name]
US Congress
Washington DC

Dear Representative/Senator [name filled in]:

I am writing today to strongly request that you act to save student programs at colleges, universiti es and secondary schools across the country. Important educational, student, and community programs are being terminated in response to the recent CARP royalty rate set by the Librarian of Congress as mandated by the Digital Millennium Copyright Act ("DMCA").

The demise of webcasting by colleges, universities, and secondary schools will cheat coming generati ons of students out of vital experiences with new technologies and deprive on-line audiences of uniq ue cultural and educational programming.

These noncommercial educational stations were precluded from taking part in the CARP process due to the extraordinary cost of participation. Additionally, the CARP process itself is flawed. Please rev iew the recent hearing testimony at (http://www.house.gov/judiciary/courts.htm) if you need clarific ation.

Following the flawed CARP process, this panel and the Librarian were forced to base their decisions on one marketplace agreement, with the very large corporation Yahoo, Inc. This deal was so expensive that Yahoo has not even renewed it! Even more astounding is the revelation that this deal was purposefully designed to limit competition by forcing rival small webcasters to cease operations (see com ments of Mark Cuban at http://www.kurthanson.com/archive/news/062402/index.asp).

I therefore ask that you write, sponsor or vote for legislation that would:

1.Set a flat rate of $200 per year for these stations.
2.Set reasonable recordkeeping requirements, such as those previously enacted under Section 118 of t he Copyright Act. 
3.Remove content restrictions imposed by the DMCA, when the programming can be determined to be of s ocial or educational value.

Congress must act immediately to guarantee the future of noncommercial educational services produced by this and future generations of students.

Sincerely, 
Your Name 

 

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Valued Listener:

Thank you for taking a moment to preserve your access to the kind of Internet radio that you are listening to right now.

Recently the Copyright Arbitration Royalty Panel (CARP) that was appointed by the U.S. Government Copyright Office, at the prompting of the Recording Industry Association of America (RIAA), recommended new and burdensome royalty payments on all Internet radio broadcasters. You can read more about this ruling, issued by the Copyright Arbitration Royalty Panel (CARP) at www.saveinternetradio.org.

These royalty costs will preclude non-commercial student radio from continuing on the web. They are also retroactive to 1998. This means that most stations are facing massive "past due" bills for everything they have ever played to listeners like you in the last four years.

We need you to fax your congressional representatives and tell them to change this ruling!

To help you, we have set up a free fax service that will do this for you. All you have to do is supply us with your name and address so that we can automatically determine who represents you and send them a fax. You will have a chance to view the fax to make sure that you agree with what it says. We will need to retain your personal information in order to prove that the faxes sent to congress are from real people. However, we will not distribute your personal information for any commercial purpose. It will be used solely as a part of our effort with the US Congress to ensure the survival of student radio on the web.

Please help us preserve student radio on the Internet!

Sincerely,
[Your Internet Broadcaster]

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A more generalized sample letter from a listener:

Dear Senator Schumer

My permanent residence is in Manhattan.  I'm a loyal listener of several internet radio stations and I'm especially fond of the service provided by WNYC, which permits me to listen to their broadcasts from anywhere in the world.  I spend a good deal of time in Switzerland and Australia but because of internet streaming, I am able to stay informed on local issues without missing a beat.  I've also learned how to spatchcock a chicken, something that I've always wanted to learn, as well as prepare a meal coordinated with wine, vegetables and desert.

After being a victim of a moth infestation that destroyed a family heirloom, I've also received valuable information about how and why you should vacuum your carpet's fibers to prevent moth infestations. The carpet and rug cleaning nyc company I hired was also discovered via the internet streaming service offered by WNYC.

The school my daughter currently attends is another fantastic find - again I credit radio programming for informing me of my choices and helping me make the final decisions that have clearly improved our lives.

Please do everything in your power to preserve the availability of citizens to access the huge variety of internet radio streams we so dearly love and depend upon to keep us informed and knowledgeable. It would be a shame to lose this valuable service.

Thank you for your time

Janet Cobb

 

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UPDATES

Legislation introduced to Save Internet Radio!

by Pandora on April 26, 2007 | http://blog.pandora.com

What a week! The outpouring of public support for internet radio over the past seven days has been nothing short of extraordinary.
Following our outreach to Pandora listeners, every congressional office was flooded with constituent phone calls, emails and faxes – literally hundreds of thousands in just 5 days! The entire fax system on the Hill was brought to a standstill. We had to hand deliver the faxes!
The response in DC has been dramatic and immediate. A bill was introduced today to reverse this terrible ruling and bring rationality to bear on this issue.
The bill is called the Internet Radio Equality Act, HR 2060 and is being introduced by Representatives Jay Inslee (D-WA) and Donald Manzullo (R-IL). For more info go to SaveNetRadio

Please take a moment to call your congress person to voice your support for this legislation and urge them to sponsor or support the bill. It’s very important the we keep pressure on the legislators to ensure that this bill is passed quickly.
If you need help determining who your member of the House of Representatives is, go to www.house.gov where, in the upper left hand corner, you can enter your zip code and get the corresponding Congressperson. Click on their name to access the main phone number of their Washington, D.C. office.
Also, a heads up that I’ll be hosting a town hall next Monday evening in the capital. We’ll be on the Hill meeting with representatives and are having a special meetup. It’ll be followed by an evening of music and a party hosted by the SaveNetRadio coalition. It’s a free event – and friends are welcome. Come join the army of webcasters, musicians, politicians and others that are driving this campaign for a night of music and conversation. Details:
Where: Be Bar , 1318 9th Street NW
When: Monday, April 30th @ 6:30 PM
RSVP: Send email to tim.westergren@pandora.com
Hope to see you there…
Thank you again for all of your support.
Tim (Founder)

 

 

The Internet Radio Fairness Act: Revamping the Online Radio Marketplace!

By Jodie Griffin November 02, 2012 | www.publicknowledge.org/

Royalties for online radio and other digital music services are a prominent topic for today’s recorded music industry, and the discussion has only grown with the recent introduction of the Internet Radio Fairness Act in the House and Senate. IRFA aims to revamp the parts of the Copyright Act that create licenses for online radio services to pay for transmitting sound recordings to their users. More specifically, IRFA would change the standard by which online radio royalty rates are set, alter the qualifications and appointment procedures for the Copyright Royalty Judges, and make several more changes to the process of setting online radio royalties.

There are a whole host of complicated issues surrounding this bill, particularly in mapping out how changes to the current royalties system would actually impact the growth of online music services and artists’ revenues. These connections are not intuitive and depend a lot on putting IRFA in the context of music industry practices and the current state of the online music streaming market.

But for now, this post will just give an overview of what IRFA actually does from a legal perspective. You can also click here for an in-depth summary of the details of IRFA.

Setting Online Radio Royalty Rates

The parts of IRFA that have made the biggest waves so far are the parts that change the standard by which the federal government sets online radio royalty rates.

First, some background. As you probably know, the Copyright Act balances the exclusive rights granted to copyright owners with a number of limitations and exceptions to those rights, some of which are called “compulsory licenses.” A compulsory license is when the details of a license are set by law, instead of by contract, for specific types of uses. If a use qualifies for one of the compulsory licenses, the user can choose to only pay the rate set by law, instead of negotiating directly with the copyright owner.

One of the uses that qualify for a compulsory license is online radio streaming. This includes companies like Pandora and broadcast radio stations that stream their programming on their websites, but does not include services like Spotify that let you pick each song you listen to. This online radio license, created in section 114 of the Copyright Act, is set by a panel called the Copyright Royalty Judges (more on them later), who must make the rates the same as the rates that online radio would have had to pay “in the marketplace between a willing buyer and a willing seller.” The CRJs are also required to consider whether online radio substitutes for or promotes the copyright owners’ other revenue streams, and the roles that the copyright owners and online radio services play in creating the content and streaming services (including contributing creativity or technology, investing money, or taking on risk).

The New Online Radio Royalty Standard

IRFA would change the willing buyer/willing seller standard to the same one currently used for satellite and cable streaming (think SiriusXM). Incidentally, this standard is also used to determine how much record labels pay publishers and songwriters to record and sell songs that have already been recorded at least once. This standard, found in section 801(b) of the Copyright Act, requires the CRJs to aim to:

  1. maximize the availability of works to the public,
  2. give copyright owners and online services a fair return,
  3. reflect the relative roles of the copyright owner and online service, and
  4. minimize disruptive impact on the structure of the industries involved and general industry practices.

In addition to the 801(b) standard, IRFA would require the CRJs to consider the public’s interest in creating new sound recordings and in fostering online music services, and the level of income necessary to provide a reasonable return on investment, including losses from prior periods. IRFA would also require the CRJs to:

  1. not disfavor rates that are set based on a percentage of the online service’s revenue,
  2. establish a fee structure that encourages competition among copyright owners and between online radio and other services,
  3. consider the promotional value of online radio,
  4. consider the value online radio gives to the value of the works it streams, and
  5. not consider interactive license fees or prior CRJ rates.

That last factor is a response to previous CRJ ratemakings, where the CRJs tried to calculate the market value of online radio by taking the rates used for interactive streaming (think Spotify), and estimating and subtracting the portion of those rates attributable to the interactive-ness of the service.

Under IRFA, the CRJs can only consider voluntary deals that are achieved in “competitive market circumstances.” Competitive market circumstances are when an online radio service gets a license from a licensor that does not have market power resulting from the aggregation of copyrights. This section seems aimed at major record labels and collective licensing organizations that can use their large copyright catalogs to obtain higher rates from online services.

The current law also requires the CRJs to set a minimum annual fee, while IRFA would make the minimum fee discretionary and set a cap on the minimum fee at $500. This would no doubt be good news for small and start-up webcasters.

One practical note: the change from the willing buyer/willing seller standard to the 801(b) standard is widely anticipated to significantly lower the royalty rates that online radio services pay. There is also a substantial need here for more economic data and analysis to predict what practical impact this bill would have on consumers, artists, and online music service. But, as I noted above, the explanation of how this would actually impact the online music marketplace and artist revenues is tricky and deserves a post of its own, so I will leave that discussion for next week.

The Missing Piece: AM/FM Radio

There is, notably, one piece of the puzzle IRFA omits: royalties paid by terrestrial AM/FM broadcast radio stations. Mostly due to the twists and turns of the law's history in this area, traditional AM/FM radio stations only pay the songwriter, not the recording artist, although they must also pay sound recording royalties if they want to webcast their programs.

Supporters of IRFA point out that IRFA very logically treats like uses alike by pulling online radio under the same umbrella as satellite and cable music services. The same logic applies to AM/FM radio: if we are to treat like services alike and be as technology-neutral as possible, it follows that AM/FM broadcasters should be included along with everybody else.

Changing the Copyright Royalty Judges

IRFA would also change how the CRJs are appointed. The CRJs are currently appointed by the Librarian of Congress, consulting with Register of Copyrights (the Copyright Office is housed within the LoC). But under IRFA, CRJs will be appointed by the President with the advice and consent of the Senate. This will make the debate surrounding nominees much more public-facing, but will also risk that CRJ appointments will be stymied if the Senate refuses or delays confirmation for unrelated political reasons.

This change would also firmly resolve the question of whether the CRJs’ appointments satisfy the requirements of the Appointments Clause in the Constitution, since the President would be appointing the CRJs directly. The most recent case on the subject, Intercollegiate Broadcasting System v. Copyright Royalty Board, actually found that the CRJs are appointed constitutionally by invalidating other parts of the CRJ appointment statute, but the changes in IRFA would make the analysis much more straightforward.

IRFA would also change the qualifications for CRJs, by removing the current requirements that one of the CRJs have experience in economics and one CRJ have experience in copyright, instead requiring that all CRJs have significant experience as judges or adjudicators. A side effect of this change may be that none of the CRJs will have significant knowledge of or experience with federal copyright law. Federal judges are unlikely to leave their positions for a temporary position as a CRJ, and state or municipal arbitrators will probably have little familiarity with federal copyright law because those lawsuits are usually removed to the federal court system. For example, the most recent Chief CRJ, James Sledge, was previously an Alabama bankruptcy court judge, a position that did not require him to be a copyright expert, although he had significant experience with running adjudicatory proceedings.

Removing the requirements for knowledge of economics or copyright could cut both ways. As discussed above, this may mean that the CRJs are more likely to have a learning curve in the position. On the other hand, this may ensure that the judges arrive at the topic objectively, without established inclinations to agree with one party over others.

But IRFA's More Than Just Royalty Standards and CRJs

Although the online radio royalty standard has been the most controversial part of IRFA, the law contains many more changes to the CRJs and online radio licensing. For example:

  1. IRFA would broaden section 112(a) of the Copyright Act to increase the number of incidental copies an online radio service could make in the process of transmitting music.
  2. IRFA would change the procedure of the CRJ proceedings, applying the Federal Rules of Civil Procedure and Federal Rules of Evidence, which are used in US federal courts.
  3. IRFA would require courts to review the CRJs’ legal conclusions and application of the 801(b) standard de novo, which means the court would not give any deference to the CRJs’ interpretation. But, pure findings of fact would only be reversed if they contained “clear error” and all other CRJ actions would be upheld unless they were an “abuse of discretion.”
  4. IRFA would only allow common agents with non-exclusive rights to negotiate on behalf of copyright owners, so no one negotiating agent would be the only source for a license. IRFA also specifies that this section does not permit copyright owners to jointly interfere with direct licensing instead of licensing through a common agent.
  5. IRFA would also require common agents or collective rights organizations to publicly list all of the artists and sound recordings they license. 
  6. Finally, IRFA would require the Librarian of Congress, in consultation with IPEC and USPTO, to make a set of recommendations to Congress on how the U.S. government can make a sustainably financed global music registry.

So there you have it. The compulsory licensing system for online radio has a lot of moving parts, and IRFA would significantly change many of them. The above explanation doesn’t go into the likely real-world impacts of IRFA on the online radio marketplace, but setting out the legal changes IRFA would make is the first step in unraveling how IRFA would change the development of online music services.

 

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