Future of internet radio hangs on new regulations
By LIUAN CHEN, The Enterprise
05/29/2007
Updated 05/28/2007 10:05:39 PM CDT
BEAUMONT - Sheila Cain runs a one-man show at Beaumont Live!, an internet radio station promoting music by little-known local artists.
She relays an eclectic mix of delta blues, jazz, modern Texas rock and "red dirt country" to listeners in 14 countries, but the rhythms could stop July 15 if new Copyright Review Board regulations go through.
The rulings would increase Internet radio sound recording royalties up to 1,200 percent and carry a $500 minimum channel royalty fee retroactive to January 2006.
What does this mean for an independent broadcaster like Cain?
The royalties would add up back to October 2006 when she started the station, meaning a $4,000 fee "for something I never made a penny on."
For Cain, a musician herself, finding and promoting local artists is a "labor of love," not work for profit. Most artists on her station aren't paid royalties anyway since they don't have record contracts.
If regulations go through, Cain said she "absolutely would have to shut down."
"This is a place for people who can't get on a regular radio station," she said. "A lot of good music won't get heard anymore."
Blues singer and guitarist Charley Drumm from Southwest Louisiana relies on Cain's station and another in Florida to get his music out.
"It's really going to hurt my efforts to get my product heard," he said regarding the possibility of Beaumont Live! shutting down.
The rate increases will put thousands of independent webcasters out of business and hurt larger online broadcasters like Yahoo and Live365, webcasters said.
Webcasters have organized to appeal the rulings, and Congress also has also pricked up its collective ears.
The Internet Radio Equality Act, recently introduced in both House and Senate, would reverse the review board's decision, setting rates at the same level now paid by satellite radio services (7.5 percent of revenue).
To Daniel Miller, owner of Radio Free Texas, a Nederland-based Internet station, the new bill is the lesser of two evils.
As he sees it, Internet radio unfairly bears a heavier burden than regular radio. While regular radio pays only songwriter royalties under a formula that's decades old, Internet radio pays additional performance royalties.
"When it's played on Internet radio, everybody gets paid," Miller said. "We're held to a standard that's less than fair, and their excuse is that it's digital."
Miller is confident the bill will pass, largely because Internet radio listeners represent a large voting constituency. His station alone serves 350,000 to 400,000 listeners monthly, he said.
"Internet radio is a very grassroots thing. Because we support independent artists people don't hear elsewhere, there's a loyalty there," he said.
Concerned listeners are taking action as well.
Since Cain announced the upcoming crisis on the Beaumont Live! Web site, many people have responded by calling their congressmen and signing petitions, including Beaumont resident Indra Tucker.
"We're all limited to what we can hear on the radio as it is," Tucker said. "I hope they would reconsider so that people have a choice to listen to regular radio stations or online."
On June 8-9 in New Braunfels, Radio Free Texas' annual music gathering, the Rowdy Float Trip, might also create a stir.
"Based on what's going on, this event's going to be huge," Miller said. "It may turn into an anti-SoundExchange (the organization collecting and distributing the royalties) rally."
lchen@beaumontenterprise.com (409) 880-0729
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
If you have any idea what people like Sheila do for our music industry and artists, such as myself, you will make whatever efforts necessary to see she, and others like her, remain in a position to "do what they do". Feel free to contact me for possibilities in helping Sheila. She's a rare person, indeed, and definitely deserves "our" help in meeting whatever ridiculously unfair licensing fees she will be forced to pay, to get our products heard by the masses. charleyrocknroll
