The SoundExchange Billion Dollar Administrative Fee

(While this won't affect SomaFM right now, it does affect many mid-sized broadcasters like Pandora and Live365; and it will affect future personalized SomaFM stations we're working on.)

c|net: ``When the CRB decided earlier this year to change the rules for Internet broadcasters, it also decided to levy a $500 minimum annual fee per Internet radio "channel." ... But since some of the larger Internet radio services potentially offer their listeners hundreds of thousands of unique "channels" (RealNetworks' Rhapsody offered more than 400,000 in 2006 alone, according to a company spokesman), the companies view the ruling as forcing them to multiply that mandatory minimum payment accordingly (for Real, that would amount to $200 million).``

What will this admin fee pay for? One notable fee: more lawyers. And more lawsuit. They'll be able to go after all the MP3 bloggers, the music podcaters, the 5000 tiny stations in the Shoutcast.com directory who aren't licensed with SoundExchange, etc. Then they'll probably start going after all the restaurants and stores that playback background music from an iPod without paying the annual $10,000 "ephemeral" fee for business establishment services.

Slashdot has also picked this up.