Blog Post

SoundExchange Spares Many Webcasters From Rate Hike; Negotiations Will Reopen

Webcasters have won another reprieve from new online royalties rates that were due to be collected this coming Monday. In a move that came as a surprise, John Simson, executive director of SoundExchange, the royalties collection society that successfully lobbied the Copyright Royalties Board for higher digital rates, yesterday told an eleventh-hour Congress Committee on Energy and Commerce hearing it would now postpone the rate hike for small and non-commercial players indefinitely while it debates a revised rate with the webcasters. At issue: an increase from $0.000762 to $0.0019 per user plus a new minimum fee of $500 per station for all but the smallest of webcasters. Now Listening Post reports those minimum fees are “off the table” while the negotiation on rates, at least for operators originally involved in negotiations with the CRB, will now be reopened.

Pandora founder Tim Westergren, whose site was amongst hundreds fearing closure due to prohibitive costs, said the reprieve was due to public lobbying. Curiously, the news came as an appeals court rejected a stay in the application of the new rates (via Washington Post). Seemingly, the rate hike will take effect legally but SoundExchange’s decision not to prosecute transgressors will leave further wiggle room. Clarifying, Simson told Radio and Internet Newsletter: “For the people who want to comply with the law and are in bona fide negotiations with us, we don’t want those people to be intimidated. And we don’t want them to stop streaming. That’s just so long as they’re continuing to pay under the license they had.”