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.

Tim Westergren, founder of the not-yet-profitable but very awesome internet radio station Pandora, has asked interested consumers to sign their petition and write to their representatives in Congress about this issue.

In an article in PC World John Simson Executive Director of SoundExchange defended the new rates, saying:

We’re interested in discussing business solutions with them, but right now they only seem interested in making noise,” he says. Asked what he means by “business solutions,” he replies: “I’m talking about sitting down with them and saying ‘Okay, let’s see if we can reach a business deal that will work for both sides.”

Speaking to the Washington Post earlier in the year, Simson was surprisingly candid about the SoundExchange’s goal of drastically reducing the amount of viable internet radio stations:

“Is 10,000 stations the right number?” asks Simson of SoundExchange, which sought the higher royalties. “Does having so many Web stations disperse the market so much that it hurts the artist? What’s the right number of stations? Is it 5,000? Is it less? Are artists better off having hundreds of listeners on lots of little stations, or thousands of listeners on larger stations?”

Jim is a master of subtlety. —MEGHANN MARCO

Order Denying Motions for Rehearing in Docket No. 2005-1 CRB DTRA (PDF)[Copyright Royalty Board]

Webcasters and Rising Royalty Fees: Paying the Price for Innovation? [Washington Post]
Net Radio: ‘New Song Royalties Will Kill Us’ [PC World]

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