Tuesday, September 18, 2007

More Bullshit from RIAA via SoundExchange

RIAA has SoundExchange issue press release to try and trick congress into thinking the royalty situation has been solved. Nice work guys.

The reason many people are signing is because they fear lawsuits from the RIAA. RIAA representatives have been calling webcasters and telling them if they didn't sign by Sep 15th, they would be operating in violation of the law. That's the only reason they signed. It's like a Sporano's episode.

The only way that webcasters can escape the high royalty rates is by signing this current agreement and only playing SX affiliated label music. This means less independent music, and more big label music. Which is exactly what the RIAA wanted.

This agreement is useless to SomaFM because it doesn't even cover half of the music we play.

Here's the release:

Small Webcasters Embrace SoundExchange Offer on Discounted Rate - September 18th, 2007

Individual Agreements Allow Small Internet Operators Subsidized Rates Through 2010

Contact Richard Ades or Gregg Perry 202.640.5894 news@soundexchange.com

WASHINGTON, D.C. - SoundExchange announced today that significant numbers of small commercial webcasters have signed agreements that allows them to continue operating through 2010 with essentially the same terms they have enjoyed under the Small Webcaster Settlement Act (SWSA). These agreements - sent in late August and signed individually with each webcaster - guarantee the same rates through 2010 that qualified small webcasters have received since 1998 for the use of sound recordings owned by SoundExchange members. The agreements are retroactive to January 1, 2006, which is the beginning of the current rate period, and continue through December 31, 2010, at which time new rates will be set either through negotiation or by the Copyright Royalty Board (CRB).

"Giving small webcasters more time to build their businesses with below-market rates is something Members of Congress wanted us to get done, and we have," said John Simson, Executive Director of SoundExchange. "We hope that these small webcasters will continue to provide innovative kinds of programming and a rich diversity of music."

Twenty-four small webcasters have already signed the agreements with others indicating they are in the process of signing. Some opted not to sign the agreements because their business models benefit more from the regular commercial rates (due to their size and the difference in minimum payments). Others did not sign because they operate via webcast aggregators who handle payments on their behalf.

Qualified small commercial webcasters who accepted the offer are now able to stream sound recordings of any and all SoundExchange members at subsidized rates. SoundExchange represents more than 28,000 recording artists and 3,500 record labels, including all the major recording companies. As part of the agreement, small webcasters (defined as those earning $1.25 million or less in total revenues) would pay royalty fees of 10 or 12 percent of revenue. The agreement also includes a usage cap to ensure that this subsidy is used only by webcasters of a certain size who are forming or strengthening their businesses.

"It's a sacrifice our members are willing to make at the request of Members of Congress and in order to give the smallest webcasters below-market rates for an additional limited time," added Simson. "This is a great deal for someone who wants to start or build a webcasting business."

# # #

Gee. 24 webcasters signed this. If you're a webcaster and signed it, I'd like to hear your reasons for signing it.

The usage cap is also a joke: if you average more than about 6900 concurrent listeners- about the audience of a single commercial station in a mid-sied market.

There are thousands of small webcasters. And only 24 have signed on? That tells you just what a huge problem this really is.

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4 Comments:

Blogger Fred said...

"SoundExchange represents more than 28,000 recording artists and 3,500 record labels, including all the major recording companies."

More fun with numbers from SoundExchange, courtesy of Richard Ades, who has never met a figure he couldn't inflate.

Apparently, they've increased the membership by 8,000 in less than a month. (The lovable John Simson was quoted in August as claiming 20,000 members, and we know how honest John is when it comes to counting.) I guess they're counting those artists they are forfeiting money from as members.

For a reality check, SoundExchange has found fewer than 40 of those "missing artists" in the last two months, based on their own website.

Rusty, any contrary word from those "independent" SoundExchange Directors you believe to exist? They've got an incredible capacity for passive resistance to this bullshit.

September 18, 2007 1:42 PM  
Anonymous Michael Clark said...

Hi,

I'm one of the 24 webcasters that signed the agreement. I play Christmas Music all year round. In December 2006, I had the third most popular station at Live365, of their 7,000+ stations.

The catch is this agreement was for small commercial webcasters. Most of the 7,000 stations at Live365 are considered to be owned by Live365, not by their DJ. There were approximately 50 small commercial webcasters nationwide that fit the description for this agreement.

My estimated bill from January 1, 2006 through March 2007 was $11,000. I estimated running up an additional $9,000 if I stayed webcasting through this Christmas season. In 2006 I had $1,200 in revenue; and estimated my revenue for 2007 was $3,000, which would have resulted in a slight profit under the old rates; and putting me in a very good position for 2008. I am an individual doing my station as a hobby/very small business. I am personally responsible for the royalties. Under the old rate system, the rate was a percentage of revenue, with a $2,000 minimum.

The reason I signed was to save myself more than $5,000. And yes, I'm now consigned to playing only SX-member music, or getting licenses from each independent artist I play. And that's quite difficult, in that some labels are out of business (I still have to pay the high Copyright Royalty Board rate though).

I've also basically been off the air since mid-March. I was hoping the whole situation would be fixed by the Fall; but I did not want to take the chance of owing even more to SX, so I shut down. At least now I'm partially back on the air.

People need to contact their member of Congress and ask them to support and sponsor HR 2060 or S 1353, the Internet Radio Equality Act. Any questions or concerns about this, just ask. Mike

mclark at christmasmusic247.com

September 18, 2007 7:39 PM  
Anonymous Anonymous said...

"The reason I signed was to save myself more than $5,000. And yes, I'm now consigned to playing only SX-member music, or getting licenses from each independent artist I play. And that's quite difficult, in that some labels are out of business (I still have to pay the high Copyright Royalty Board rate though)."


Ya knowthis shyt is getting old and I am sick and tired of SX'S shyt pass the bill and lets end this bs!

September 19, 2007 9:18 PM  
Anonymous Anonymous said...

Sound Exchange is using the old divide and conquer to try to finally pull the pllug on net radio.

They know if they caused undue hardship on the hobbyists that the press would seize upon that story - ya know, big guy crushes little guy into bankruptcy and all the little guy wanted to do was play some music... that'd make a great story in the eyes of the press.

The hobbyists suddenly found themselves in the real world and their pocketbooks couldn't meet the obligations of what they were producing. They just wanted out, supposedly. What I find interesting is that many of these hobbyists didn't just close down their stations realizing that they can't afford their hobby anymore, they kept going and will most likely keep going until the end of 2010. So I guess Mr. Simson has made some people happy, for at least a while anyhow, well, as long as they play by his rules.

So, Sound Exchange takes care of the hobbyist, uses the PR opportunity and then continues on its prescribed path of crushing independent net radio - they are very focused.

The hobbyist, while, in most cases being a music lover that just wants to share that love, has caused a serious problem for those that want to make their net radio stations a legitimate business. At this juncture there is no more room for the independent hobbyist net radio station, which really is a shame. They're worried about saving $5,000 and Soma and others are worried about the millions they've invested.

What a mess.

You've got to give it to Sound Exchange, they're good at what they do, but I'm still going to hate, and work against, everything that they're up to.

September 20, 2007 7:15 AM  

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