Internet Radio Granted Slight Reprieve: Is It Enough?
Pandora, take a breath. Slacker, slack off. True, a deal has not yet been struck between the Digital Media Association, which represents web-based radio, and SoundExchange, the agency in charge of royalties for the RIAA. Still, the heavy lifting is over.
Last year, the Copyright Royalty Board came up with a royalty scheme that threatened to bankrupt Internet radio sites like Pandora, and cut into the profits of Slacker. Then in September, Congress allowed the negotiations to start up again in an effort to let the radio continue to play.
There are new terms, but they're still not exactly fair.
The official rates haven't been announced, but Tim Westergren from Pandora said the compromised plan is still "tremendously unfair" compared to the fees paid by Sirius XM Satellite radio. Good old AM and FM radio don't pay any of this type of fee.
Let's hope the new fees are enough to keep sites like Pandora and Slacker not only running, but massively profitable. They're good for the music business, great for music lovers, and I hate the thought that the music business might kill them off. —Leslie Shapiro