Library of Congress Sets Royalty Rate for Webcasters
Librarian of Congress James H. Billington, who oversees the U.S. Copyright Office, ruled June 20 that Internet radio stations offering music on the Web must pay royalties to artists and recording studios. The ruling also affects broadcast radio stations that offer content on their Web sites, the Associated Press reported June 21.
Billington also found that a February 20 recommendation by an independent Copyright Arbitration Royalty Panel “was arbitrary and not supported by the record of evidence,” according to LC Public Affairs Officer Jill Brett. His ruling sets the rate at 70 cents per song for every 1,000 listeners, exactly half the rate proposed by the panel.
The debate over Webcasting royalties began in 1998 after Congress passed the Digital Millennium Copyright Act, which required Webcasters to pay royalties but preserved the long-standing exemption of AM and FM broadcasters. LC convened the CARP panel in July 2000 after negotiations between Webcasters and record companies broke down.
The June 21 Washington Post reported that smaller Webcasters could go out of business even with the reduced rate. “This is going to destroy Internet radio,” said Kevin Shively, director of interactive media for the New England–based Beethoven.com, a classical-music Web site.
If the decision is not appealed, the first monthly payments are due in November; the fees are retroactive to 1998 when the DMCA was passed.
Posted June 24, 2002.