Today is, unfortunately, a day that may be giving Internet radio fans a taste of things to come. Countless online radio stations have gone silent today in protest of a royalty rate hike that would be retroactive to January 2006. That’s 17 months of being charged a rate that is greater than 300% of what Internet broadcasters already pay. Many of these online stations are tiny operations that can’t afford it. If this royalty hike comes to pass, they will go out of business forever.
It comes from a business known to shoot itself in the foot in regards to online music. The music business has long been suffering since its attack on peer-to-peer downloads of MP3s. Layoffs are becoming increasingly common in the recording industry (Warner Music Group announced last month it would lay off 400 employees).
The music industry is now asking for a staggering amount of money from those who promote their product. With Internet radio out of business, the means of music promotion will disappear, and the music business shoots itself in the foot again.
The Internet Radio Equality Act
If enough ‘net radio fans can call their representatives today to influence them to support the Act, radio stations broadcasting online could be saved. Royalty rates charged would be more in line with what is charged to satellite radio, which are far less, hence the name “equality act.”
With the act passed, Internet radio would be allowed to flourish, which is a good thing for small webcasters like Derek Grimme of Creamy Radio, who says those who haven’t yet heard of Internet radio ultimately will.
“It is one of the key mediums actively promoting a greater diversity in music as a whole, as well as a greater range of exposure options for artists,” Grimme says. “In addition to that, it is one of the greatest growing mediums. Advanced cell phones can receive it, Tivo 2.0 receivers can receive it and there are many stereo receivers and table radios designed to receive it. It is also expected that car based Internet radio tuners are not far off with the growth of wireless access. The number of ways to access Internet radio is only growing and becoming easier. A medium this youthful and wonderfully diverse at the very cusp of its accessibility to all deserves a fairer chance at growth and survival than this increase allows.”
Imagine a world where surviving webcasters end up getting a sweetheart license from major record companies in order to operate. Then the major labels will get to control programming at online radio stations. In other words, the independent spirit that makes Internet radio great would be killed.
Take Action to Save Internet Radio
Fans who don’t want to lose their Internet radio today are encouraged to contact their representatives. SaveNetRadio.org has been set up for that purpose.
