Jay Inslee: Washington's 1st Congressional District
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Lawmakers hope to prevent demise of Internet radio
26 April 2007
A measure was introduced today in Congress that would help prevent the decline of online radio broadcasting.
U.S. Reps. Jay Inslee (D-Wash.) and Don Manzullo (R-Ill.) filed legislation that would reverse a recent decision of the federal Copyright Royalty Board (CRB) to at least triple the amount of royalties Internet radio broadcasters pay to copyright holders for playing a song.
In March, the CRB drastically increased royalty rates for webcasters - starting retroactively at $0.0008 per song in 2006 and climbing to $0.0019 per song in 2010. Though it costs only fractions of a penny per song, the change amounts to a 300 percent cost increase for the largest webcasters and up to a 1200 percent increase for smaller operations.
"This Titanic rate increase is simply untenable for many Internet radio broadcasters," said Inslee, a member of the House Energy and Commerce Subcommittee on Telecommunications and the Internet.
"You can't put an economic chokehold on this emerging force of democracy," he added. "There has to be a business model that allows creative webcasters to thrive and the existing rule removes all the oxygen from this space."
"The Internet has provided us with amazing opportunities to enjoy music, and this unfair action by the CRB threatens to take it all away," Manzullo said. "Our legislation overturns the huge rate increases and sets up a system that is fair to webcasters, web users and the artists whose music we all enjoy. And most importantly, it will keep music playing on the Internet."
The Inslee-Manzullo Internet Radio Equality Act, H.R. 2060, would provide royalty parity for Internet radio providers. It would vacate the CRB's March 2 decision and apply the same royalty rate-setting standard to commercial Internet radio, as well as satellite radio, cable radio and jukeboxes. A transition rate of 7.5 percent of revenue would be set through 2010.
According to Nielsen Media Research, 70 million Americans listen to online radio each month. Inslee and Manzullo already have received over 1000 letters and e-mails this month opposing the CRB's decision.