Wyden-Brownback ‘Internet Radio Equality Act’ Introduced in the Senate

Legislation introduced by Senators Ron Wyden (D-OR) and Sam Brownback (R-KA) today would save Internet radio from a recent royalty hike that threatens to bankrupt the industry. The Internet Radio Equality Act would vacate a Copyright Royalty Board (CRB) decision to increase fees webcasters pay to play music online by a devastating 300 to 1200 percent. Companion legislation (H.R. 2060) introduced in the House of Representatives on April 26th, by Congressman Jay Inslee (D-WA) and Don Manzullo (R-IL), has already garnered the support of more than 60 cosponsors.

I received a note from the Tim Westergren, founder of Pandora, back in April about this issue. For anyone unfamiliar with Pandora, check it out. I wound up buying a dozen CD's because of music I heard on the site. Music I wouldn't have necessarily heard on the radio. This is a good thing, I would think, for the artists.

Anyway, Mr. Westergren sent the following:

Hi, it's Tim from Pandora,

I'm writing today to ask for your help. The survival of Pandora and all of Internet radio is in jeopardy because of a recent decision by the Copyright Royalty Board in Washington, DC to almost triple the licensing fees for Internet radio sites like Pandora. The new royalty rates are irrationally high, more than four times what satellite radio pays, and broadcast radio doesn't pay these at all. Left unchanged, these new royalties will kill every Internet radio site, including Pandora.

In response to these new and unfair fees, we have formed the SaveNetRadio Coalition, a group that includes listeners, artists, labels and webcasters. I hope that you will consider joining us.

Please sign our petition urging your Congressional representative to act to save Internet radio: http://capwiz.com/saveinternetradio/issues/alert/?alertid=9631541

Please feel free to forward this link/email to your friends - the more petitioners we can get, the better.

Understand that we are fully supportive of paying royalties to the artists whose music we play, and have done so since our inception. As a former touring musician myself, I'm no stranger to the challenges facing working musicians. The issue we have with the recent ruling is that it puts the cost of streaming far out of the range of ANY webcaster's business potential.

I hope you'll take just a few minutes to sign our petition - it WILL make a difference. As a young industry, we do not have the lobbying power of the RIAA. You, our listeners, are by far our biggest and most influential allies.

As always, and now more than ever, thank you for your support.

-Tim Westergren (Pandora founder)

I signed the petition and sent a letter to my senators. It would figure that I only got a response from Senator Lieberman. I wonder if Chris Dodd isn't a figment of our imaginations. Actually, that would be a good thing. Here's the response I got back from Lieberman:

May 10, 2007

Thank you for contacting me regarding the Copyright Royalty Board's decision with respect to royalty rates for webcasters. I appreciate the concerns you raised about this decision.

You may be interested to know that in the U.S. House of Representatives, Congressman Jay Inslee (D-WA) introduced the Internet Radio Equality Act (H.R. 2060). H.R. 2060 effectively voids the Copyright Royalty Board's decision and sets new rates for the royalties to be paid by Internet radio stations. Specifically, H.R. 2060 states that commercial Internet radio stations instead pay one of two royalty rates for the next five years, to be determined by the station itself, as follows: 1. 0.33 cents per hour of sound recordings transmitted to a single listener; or 2. 7.5 percent of the revenues received by the provider during that year that are directly related to the provider's digital transmissions of sound recordings.

H.R. 2060 also alters the formula for determining the royalty payments for non-commercial Internet radio stations so that these stations will pay lower rates than those determined by the Royalty Board. For more information on this topic, I encourage you to visit the federal resources section of my web site at http://lieberman.senate.gov/issues/resources/, where you will find a "Congressional Research Service" link to a collection of informative and research documents prepared by the Library of Congress.

A report entitled "Statutory Royalty Rates for 'Small' Webcasters: Decision of the Copyright Royalty Board" has been made available, which I hope you find helpful. A companion version of H.R. 2060 has not yet been introduced in the Senate at this time. However, please be assured that I will keep your views in mind should legislation on this subject come before the full Senate for debate.

To keep track of actions on specific legislation, you can go to the "Bill Tracking" service at http://lieberman.senate.gov/issues/resources. My official Senate web site is designed to be an on-line office that provides access to constituent services, Connecticut-specific information, and an abundance of information about what I am working on in the Senate on behalf of Connecticut and the nation.

I am also pleased to let you know that I have launched an email news update service through my web site. You can sign up for that service by visiting http://lieberman.senate.gov and clicking on the "Subscribe Email News Updates" button at the bottom of the home page. I hope these are informative and useful.

Thank you again for letting me know your views and concerns. Please contact me if you have any additional questions or comments about our work in Congress. Sincerely, Joseph I. Lieberman UNITED STATES SENATOR JIL:amf

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