The US House of Representatives yesterday approved a deal that,
if approved by the Senate, should prevent many small US-based
internet radio stations from going out of business as a result of a
ruling that webcasters should pay royalties of 0.07 cents per
listener per song.
The royalty rate that many webcasters say would put them out of
business is due to come into force on 20th October and requires
retrospective payments dating back to 1998.
The new bill postpones the enforcement of payments for a
six-month period to allow an assessment of fees. It was approved by
the House of Representatives in conjunction with approval of a deal
reached on Sunday by record companies, recording artists and
webcasters that gives preferential treatment to small
businesses.
Under the proposed deal, which must also be approved by the
Senate, webcasters with revenues below $250,000 would pay the
greater of 10% of their revenues for broadcasts between 1998 and
the end of 2002 or 7% of expenses; those turning over between
$250,000 and $500,000 would pay the greater of 12% or 7%
respectively.
