It Still Sucks

New tentative deal between RIAA and webcasting reps (Digital Media Association) on webcasting royalties:

SUMMARY OF DiMA-SOUNDEXCHANGE PROPOSAL
FOR INTERNET RADIO ROYALTY RATES & TERMS

Scope: Covers digital audio transmissions of sound recordings by commercial
webcasters ("eligible nonsubscription transmission services") and subscription services ("new subscription services"), subject to the statutory licenses in Sections 112 and 114.
Term: 2003 & 2004
Exclusions: The following services or transmissions are not covered by the proposal:
* Noncommercial entities (e.g., college radio stations, state-owned entities, nonprofits).

* Simultaneous retransmissions of AM or FM broadcasts, whether made by the owner or operator of the AM or FM radio station or by a third party.

* Services that have elected to pay royalties under the Small Webcaster Settlement Act of 2002.

License Fees:
Eligible Nonsubscription Transmission Services
Option of paying royalties as follows:

* Per Performance Option – .0762 cents ($0.000762) per performance 3 , except that 4% of performances shall bear no royalty.

* Aggregate Tuning Hour Option – 1.17 cents ($0.0117) per aggregate tuning hour.

New Subscription Services
Option of paying royalties as follows:

* Per Performance Option – .0762 cents ($0.000762) per performance, except that 4% of performances shall bear no royalty.

* Aggregate Tuning Hour Option – 1.17 cents ($0.0117) per aggregate tuning hour.

* Percentage of Subscription Revenues Option – 10.9% of "Subscription Service Revenues", but in no event less than 27 cents per month for each person who subscribes to the subscription

DiMA's statement to the public:

For Internet radio services "the agreement is a temporary band-aid that avoids millions of dollars of legal fees associated with a broken arbitration process, and thereby enables resources to be focused on high-quality programming that is enjoyed by millions of listeners," said Jonathan Potter, Executive Director of DiMA.

Although the proposed rates would, if approved, provide some stability to the nascent Internet radio industry, "they should not distract attention from two essential points," said Potter.

Continued on the next page Page 1 — Page 2

Article Author: Eric Olsen

Career media professional Eric Olsen is honored to be the founder and publisher of Blogcritics.org, which, quite frankly, rules - as do his wife and four children.

Visit Eric Olsen's author page — Eric Olsen's Blog