Internet radio stations had mounted a public campaign, claiming
that new fees for playing music online set by the Copyright Royalty
Board (CRB) would put them out of business. The measures approved
by the House of Representatives will allow online radio companies
to conduct their own negotiations with rights holders over what
fees to pay.
To become law the Webcaster Settlement Act would need to be
passed by the Senate and signed by the US president. Observers do
not expect any major obstacles to be put in its way.
“This bill favors all webcasters and simulcasters – large and
small," said John Simson, executive director of SoundExchange, the
body that collects the royalties. "It paves the way for
SoundExchange to use the coming months to pursue helpful solutions
that allow all services to focus on business development."
The Act gives companies until February 2009 to negotiate with
SoundExchange over what royalties should be paid to the rights
holders which SoundExchange represents. Any agreement reached
privately would have to be approved by Congress.
The CRB, which reports to the US Library of Congress, changed
the fees paid by internet broadcasters last year. They had been
paying 0.08 cents per song played but that was scheduled to rise in
increments to 0.19 cents per song by 2010.
Internet radio company Pandora had led the public campaign
against the fees. Founder Tim Westergren had said that they new
royalties would put his company out of business.
"We're approaching a pull-the-plug kind of decision," Westergren
told The Washington Post earlier this year. "This is like a last
stand for webcasting.”
Pandora had asked listeners to telephone politicians to convince
them to back the Act in a move that was widely seen as effective.
It had been predicted that the vote would be close but the Act was
passed unanimously by acclaim.
US press reports said that traditional radio trade body the
National Association of Broadcasters (NAB) had opposed the Act.
Westergren said in a statement, though, that the direct action of
Pandora users had trumped industry lobbying.
"Thanks to your incredible support we were able to overcome the
NAB's efforts to derail us. Phone calls rained into the
congressional offices over the past 36 hours. Just amazing,"
Westergren said on Pandora's website.
In his request for users to phone their representatives,
Westergren had said that "only massive grassroots opposition will
keep us from another 50 years of top 40 radio. It's time to take a
stand and break the stranglehold of broadcast media on radio".
