The music industry has experienced multiple earth-shifting changes in the last 15 years. Widespread Internet use brought us the era of free-for-all sharing with Napster and LimeWire. Then Apple’s iTunes legitimized digital music downloads as a viable distribution model, but also showed that record companies are not always needed to have a hit. Streaming services like Pandora now give users free access to virtually every available song, but at what cost to both the artist and the webcaster? [More]
The California Coastal Commission unveiled a new license plate design featuring a whale’s tale tweaked slightly from the previous design, and an environmental nonprofit said the state did so because the artist who created the previous design asked for royalties to help fund the organization. [More]
This digital photography fad isn’t great for companies that built their empires on film, so Kodak seems to be grasping at legal straws to generate some revenue. The company filed a image-previewing patent claim to force smartphone makers such as Apple and BlackBerry maker Research In Motion Limited to pay it royalties. The United States International Trade Commission ruled that the phones don’t violate the patent. [More]
Last April, Techdirt pointed out that a financial firm in Texas was trying to attach “private transfer fees” to homes, so that developers would get a little bit of each sale as it passed among owners in the years to come. It sounded crazy then–imagine having to pay royalties on clothes or furniture whenever you resold them–but the firm is aggressively expanding its plan and has signed up more than 5,000 developers across the country, reports the New York Times. If you buy a new house in the next decade, look for a “resale fee” covenant hidden in a separate document that might not be included in your closing papers or even require a signature. [More]
One of the weirder strategies by the American Society of Composers, Authors and Publishers (ASCAP) recently has been to claim that every time a ringtone played, a royalty should be paid. ASCAP sued AT&T earlier this year over the claim, but a federal judge has ruled that your phone ringing does not constitute a public performance.
Not content to let the RIAA get all the recent publicity for stupid lawsuits, ASCAP has sued AT&T over sales of ringtones, saying each time a ringtone plays it’s a public performance and royalties should be paid. Luckily (?) for consumers, ASCAP wants AT&T, not individuals, to pay—although we wonder what they’ll say when you take a track from your own library and make a ringtone out of it.
Assuming negotiations succeed, you’ll have your Pandora to listen to after all. On Tuesday, Congress passed the Webcaster Settlement Act, which gives Internet radio stations like Pandora until February 2009 to reach a new royalty agreement with copyright holders; if they meet the deadline, the government will not interfere, which is great news since it was the gov’s Copyright Royalty Board (CRB) that set the current market-killing fees in the first place.
When SoundExchange, the organization that represents many labels and artists, proposed steep new royalty rates for radio webcasters last year, they shortsightedly killed off their own revenue stream. Instead of their proposed rates being cut back as part of a standard negotiation, they were surprised to see the U.S. Copyright Royalty Board reject opposing arguments and adopt SoundExchange’s rates fully. Now Pandora, the popular streaming music site, says it’s paying over 70% of its revenue in royalties, and unless Washington changes the rates soon—which looks unlikely— they will have to shut down.
Internet broadcasters suffered a blow Monday when the Copyright Royalty Board judges denied a motion for rehearing sponsored by NPR and other broadcasters. The motion denies a rehearing on the grounds that the parties did not offer sufficient new evidence. They also denied a motion to stay the enforcement of the new royalty rate until the appeal process is complete, claiming that if the rate is eventually overturned it can be refunded.
Internet radio’s low overhead allows for stations to broadcast on a shoestring budget and still access a worldwide audience. For some college stations that only have small transmitters or broadcast in small communities, streaming actually becomes the main source for listeners.
Today, on behalf of the public radio system, NPR filed a motion for rehearing with the Copyright Royalty Board in response to its March 2, 2007 decision on rates for streaming internet music. This action is the first step in NPR’s efforts to reverse the decision, and it will be followed by an appeal of the Board’s decision to be filed with the U.S. Court of Appeals for the DC Circuit.
Yeah! They’re bringing the fight! According to Andi Sporkin, Vice President for Communications, NPR: “The Board’s decision to dramatically raise public radio stations’ rates was based on inaccurate assumptions and lack of understanding of the issues. The new rates inexplicably break with the longstanding tradition of recognizing public radio’s non-commercial, non-profit role, while the procedures we’re being asked to now undertake for measurement are non-existent, arbitrary and costly.” Read the filing inside.
“This is a stunning, damaging decision for public radio and its commitment to music discovery and education, which has been part of our tradition for more than half a century. Public radio’s agreements on royalties with all such organizations, including the RIAA, have always taken into account our public service mission and non-profit status. These new rates, at least 20 times more than what stations have paid in the past, treat us as if we were commercial radio – although by its nature, public radio cannot increase revenue from more listeners or more content, the factors that set this new rate. Also, we are being required to pay an internet royalty fee that is vastly more expensive than what we pay for over-the-air use of music, although for a fraction of the over-the-air audience.
Keep reading it gets meaner…