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The Wrong Done By Copyrights
Dateline: 07/28/02

After several years of having a “free ride” when it came to paying royalties for music webcast through streaming media, U.S. copyright law recently came back to bite Webcasters in their pocketbook. After September 1, 2002, Web Radio Stations will have to pay $.0007 per song played. Although that may seem slight and insignificant on the surface, when added up, any station that continuously plays music will soon find themselves owing thousands of dollars in fees.

It can’t be said that artists who create this music and record companies who fund and distribute it don’t deserve something. But, in all their hurry to make sure their “piece of the pie” was not diluted into oblivion by thousands of Internet-based radio stations, they have done themselves, their customers and radio listeners a huge disservice.

Webcasting is still an emerging technology and art form. Instead of a mad dash for payments, The artists and record companies could have permitted a moratorium on payments for one year. This time, would have allowed webcasters to decide whether they could continue broadcasting while developing a business plan that might possibly bring in the revenue to keep their operations going and to satisfy the responsibility of providing royalties.

In addition, the artists and record companies should have pushed for the establishment of various classifications of webcasting to better enforce royalty collection where it was warranted. For instance, there should be royalty exemptions, like there are tax exemptions, for certain webcasters like the individual or organization who runs an online radio station not-for-profit. Sure, make them fill out the paperwork and insist on the documentation and sworn statements. But, to eliminate these alternative music formats and audio sources because of greed only serves to lessen the choices so desperately needed in an age of traditional cookie-cutter corporate radio.

Secondly, it would have been more reasonable to have a sliding scale of royalties apply to online commercial stations (webcasted not traditional) based not on the amount of song plays but rather, simply on the percentage of profit made, similar to our tax code. Folks, this is not brain surgery! It just makes sense to allow the entrepreneur to create his profit and then pay for the overhead, in this case the music usage fees. Ultimately, the marketplace (the listeners) would decide which commercial webcasts got their attention and financial support. The good stations would survive and the bad ones would fade away.

The real sad part about all this is what I alluded to before. Silencing new and alternative voices in an age where the sameness of traditional radio desperately needs a wake-up call just hurts everyone. The artists and record companies have bullied their way through this issue using high-powered lawyers in a typical defensive ploy. Yes, they had rights they could legally enforce but in this age of corporate irresponsibility, it would have been refreshing and socially empowering for our society if the owners of the copyrighted music had opted to untie the hands of those webcasters who provide service for nothing in return and to put their confidence in the marketplace. Instead they sought the immediate gratification of simply putting some more money in their pockets.

- Corey Deitz

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