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http://www.flickr.com/photos/kt/According to the mail that is floating the internet these days from Pandora founder Tim Westergren Internet Radio is on the edge of dying. In the mail he recommend “support[ing] the Brownback Internet Radio Equality amendment that will be considered in the Judiciary Committee this Thursday [tomorrow?].

This amendment sets webcasting royalties at the same level as those paid by satellite radio, which would compensate musicians fairly and allow web radio to survive. For more info on the bill, please visit: www.savenetradio.org

Today the situation is another in the American legal system:

FACT: The smallest medium – Internet radio – pays the most royalties; and under the new CRB royalty scheme the smallest webcasters will pay the highest relative royalties in amounts shockingly disproportionate to their revenue.

  • Broadcast radio, an industry with $20 billion in annual revenue, is exempt and pays no performance royalties to record companies or recording artists.
  • Satellite radio, which has approximately $2 billion in annual revenue pays between 3 and 7% of revenue in sound recording performance royalties.
  • The six largest Internet-only radio services anticipate combined revenue of only $37.5 million in 2006, but will pay a whopping 47% (or $17.6 million) in sound recording performance royalties under the new CRB ruling. In 2008 combined revenues will total only $73.6 million, but royalties will be 58% or $42.4 million.
  • Small Internet radio services are essentially bankrupted by the CRB ruling, with most anticipating royalty obligations equaling or exceeding total revenue.”

www.savenetradio.org

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