SoundExchange backs down
p2pnet.net news:- Continuing harsh criticism of SoundExchange, the former RIAA entity which collects and distributes royalties from webcasters and satellite radio and which is causing so much pain to small broadcasters, was among factors which have persuaded it to pull back from new royalty rates, if only temporarily.
SoundExchange demanded much higher payments but smaller Net radio firms say the new rates would ruin them.
Now, the corporate music industry collection agency says it’ll defer new copyright payment rates, set by the Copyright Royalty Board, for webcasters with revenues of $1.25 million or less.
“SoundExchange’s latest efforts follow mounting activity in Congress, where legislators have introduced bills to annul the pending royalty rate increase, which they say threatens the fledgling industry,” says Reuters.
“Although the rates revised by the CRB are fair and based on the value of music in the marketplace, there’s a sense in the music community and in Congress that small webcasters need more time to develop their businesses,” the story has John Simson (right), executive director of SoundExchange, saying disingenuously.
Simpson has been vigorously defending the new rates, claiming the corporate music industry, hard-pressed by changing trends introduced by 21st digital century technologies, desperately needs them to survive.
Entertainment lawyer and p2pnet contributor Fred Wilhelms has repeatedly cited SoundExchange’s Simson for gross inconsistencies in his claims, meant to justify the demands for increases in the royalty rates.
Said Wilhelms recently:
Remember, SoundExchange had several extra million to depend on the CRB hearings because it got to keep royalties intended for artists they are unable to locate. They’re still playing with house money here. The RIAA doesn’t have to spend a dime of their members’ own money on this campaign (so they can focus on paying their lawyers chasing those downloading grandmothers) so long as SoundExchange can use money that should have gone to artists.
Low royalty rates for DiMA mean low royalty rates for all webcasters, mostly because SoundExchange considered all webcasters the same in making their argument before the CRB. That monolithic viewpoint wasn’t DiMA’s fault, but as long as SoundExchange insists it is so, DiMA and the small webcasters should be able to stand together, because small webcasters want exactly the same results as DiMA. They want to continue to broadcast, and they want a royalty structure that permits them to do so. It’s a mutually beneficial alliance. DiMA brings the wallet, the small webcasters bring the numbers, and the voices, and the manpower.
On the other side, does anyone really believe the RIAA wants the same thing as the independent labels, and that any label wants the same thing as artists when it comes to getting heard on Internet radio and getting paid for it? Yet that’s the schizophrenic constituency SoundExchange claims is unified behind the CRB rates.
SoundExchange has only itself to blame for the existence of that organized opposition and the legislation that opposition is promoting. If SoundExchange had been pro-active, instead of saying webcasters should just stop whining about the decision, the result probably would not be IREA, but some negotiated middle ground that would have recognized differences in webcaster business models.
Instead, we got to listen to Simson reciting the litany that the CRB process was fair and reasonable. All that business about “reaching out” to webcasters only happened after Congress got involved. Arrogance has its cost, and the bill for SoundExchange appears to be coming due.
“SoundExchange’s offer to extend the core SWSA (Small Webcaster Settlement Act ) terms represents a continued subsidy for these small webcasters in the form of lower payments to artists and content owners,” says the agency in a statement, going on:
“SoundExchange is proposing that the subsidy be based on a percentage of revenue model and is proposing the same rates that prevailed under SWSA: small webcasters would pay royalty fees of 10 percent of all gross revenue up to $250,000, and 12 percent for all gross revenue above that amount. The proposal includes both a revenue cap and a usage cap to ensure that this subsidy is used only by webcasters of a certain size who are forming or strengthening their business.”
However, “A proposal like this would doom small webcasters and kill large webcasters,” Reuters has Jake Ward of the SaveNetRadio Coalition declaring.
“By deeming a webcaster large and subject to higher rates, due to its popularity, ignores the fact that many of these larger sites are still small, struggling companies, he said, according toi the story.
“It would also force small companies to stay small,” he said, noting that certain companies might seek to stay below the higher rate levels. “There’s no question that webcasters with government-set revenue caps would invest less, innovate less and promote less.”
Stay tuned.
Also See:
Reuters – Royalty increase may be delayed, May 23, 2007
recently – Critical online radio battle, May 14, 2007
statement – SoundExchange Extends Offer to Small Webcasters, May 22, 2007
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May 23rd, 2007 at 8:40 am
Shouldn’t whatever percentage of take that a webcaster pay SoundExchange for using music be a function of how much SoundExchange music is used?
After all there is a lot of independent (not represented by SoundExchange) and public domain and ownership unclaimed music and recordings out there.
It seems to me that Copyright Office royalty board and SoundExchange have found simplicity where there is none.
Rafael Venegas
gvenegas.com
May 23rd, 2007 at 11:22 am
“Simpson has been vigorously defending the new rates, claiming the corporate music industry…desperately needs them to survive.”
Perhaps the corporate music industry’s time has come. Time to get your tickets punched boys. C’ya, wouldn’t wanna be ya, @$$holes.
May 23rd, 2007 at 5:06 pm
The webcasters’ response to the “offer they can’t refuse” has been predictable and unanimous in rejection of SoundExchange’s terms. John Simson will be able to claim that their good faith has been scorned, but this isn’t going to fool anyone except those befuddled souls who were already on their side.
It is interesting to note, in spite of all that noise Simson made about “reaching out” to webcasters sinch HR 2060 was introduced, that David Oxenford, the attorney for the small commercial webcasters, viewed the SoundExchange “offer” as a “starting point” for negotiations, but felt that “negotiation by press release” was not the way to proceed. It sounds for all the world as if Simson and SoundExchange were more interested in telling people they were reaching out than they were in actually reaching out. In other words, they still expect people to believe what they say they do rather than believe they actually do it.
May 25th, 2007 at 12:14 am
Just a bunch of greedy corporate pigs.
How many times have you gone into a music store and seen the same ole’ humdrum music that has been throughly worn out for the last thirty years or so and being repackaged a million times ?
The whole concept of copyright and patent issues in the United are so outdated and arcane that everytime any kind of broadcast that plays and pays royalties on unlistenable drivel it amounts to extortion.
It’s always the same ole’ bullshit alternative and rap cds the entertainment cartels loving shoving down your kid’s throats and corrupting their young impressionable minds throughly with perverted vile lyrics that leave little to the imagination.
How would most people feel if there was a huge backlash to this kind of vile filth that the the religious right and other concerned morality groups decided to encourage parents to confiscate their kid’s rap and alternative cds and uncermoniously threw them on a pile AND BURN THEM ?
It would resemble the book burning incident in nazi germany on may 10 1933 when Adolf hitler decreed that all artisically suspect books and manuscripts were to be set ablaze.
The RIAA are a bunch of shameless corporate pigs that represent a dying business model in which they will shamelessly sell your kids any kind perverted filth in which they have the arrogance and the audacity to ask for money everytime the perverted filth is played in a broadcast outlet and medium.
I can go to LIVE365.COM and they even have broadcast stations that are involved is satan worship and they also have stations that are satanic and play death metal.
Hey royality rates are the least of their worries.
How would you people like a rerun of Tipper Gore and the broadcast witchhunt of the 1980s ?
They have people in congress talking about reviving the so called “fairness doctrine” and it has a lot of people in conservative talk show circuit worried about censorship.
Rap and alternative cds are next.
Then the morality police will have satan based websites and internet radio stations that promote satanism will be also targeted.
How about Air america ?
They bash George Bush everyday.
I am Quite sure there are people in congress that are actively scheming in how they can pass a anti internet porn and smut law that could pass judicial and legislative muster and run more than a few porn sites of the internet.
May 25th, 2007 at 12:22 am
Just a bunch of greedy corporate pigs.
How many times have you gone into a music store and seen the same ole’ humdrum music that has been throughly worn out for the last thirty years or so and being repackaged a million times ?
The whole concept of copyright and patent issues in the United are so outdated and arcane that everytime any kind of broadcast that plays and pays royalties on unlistenable drivel it amounts to extortion.
It’s always the same ole’ bullshit alternative and rap cds the entertainment cartels loving shoving down your kid’s throats and corrupting their young impressionable minds throughly with perverted vile lyrics that leave little to the imagination.
How would most people feel if there was a huge backlash to this kind of vile filth that the the religious right and other concerned morality groups decided to encourage parents to confiscate their kid’s rap and alternative cds and uncermoniously threw them on a pile AND BURN THEM ?
It would resemble the book burning incident in nazi germany on may 10 1933 when Adolf hitler decreed that all artisically suspect books and manuscripts were to be set ablaze.
The RIAA are a bunch of shameless corporate pigs that represent a dying business model in which they will shamelessly sell your kids any kind perverted filth in which they have the arrogance and the audacity to ask for money everytime the perverted filth is played in a broadcast outlet and medium.
I can go to LIVE365.COM and they even have broadcast stations that are involved in satan worship and they also have stations that are satanic and play death metal.
Hey royality rates are the least of their worries.
How would you people like a rerun of Tipper Gore and the video broadcast witchhunt of the 1980s ?
They have people in congress talking about reviving the so called “fairness doctrine” and it has a lot of people in conservative talk show circuit worried about censorship.
Rap and alternative cds are next.
Then the morality police will have satan based websites run off the internet and internet radio stations that promote satanism will be also targeted.
How about Air america ?
They bash George Bush everyday.
I am Quite sure there are people in congress that are actively scheming in how they can pass a anti internet porn and smut law that could pass judicial and legislative muster and run more than a few porn sites of the internet.
February 14th, 2008 at 9:10 am
This really opened my eyes even though it was written last year.