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Sorry to those of you who did not sign up for Email notifications from this site, but I think this news is pretty important.
I just got a note in my Email from one of my favorite internet radio stations, SomaFM.com. I'll guess that most of the folks who read this site's posts are going to want to get on the petition he mentions. Read on:
Dear Bill Haenel:
You may have heard, but once again internet radio is facing huge additional royalties for broadcasting music. These royalties are in addition to the ones that we pay to ASCAP and BMI, and are a royalty that is only paid by internet broadcasters. Over-the-air (AM/FM) broadcasters are explicitly exempt from this royalty; it only applies to internet broadcasters and subscription music services.
In the past, we paid royalties based on a percentage of our revenues, in our case 10% of our revenue. But the new royalties don't allow that percentage of revenue factor, and instead charge us for each song we play times the number of people listening. This works out to about $8 per average concurrent listener per month. In 2006, we averaged over 6000 average concurrent listeners per month, and the royalties we will have to pay for 2006 is about $628,000, over 4 times the amount of money we brought in.
And these rates go up drastically each year, until 2010, where they are 2.5 times their initial rate: by then we will have to pay over $1 million dollars a year in royalties if we want to stay on the air.
So you can see that this puts us in an impossible position. And to make it even worse, the rates are retroactive to 2006.
It doesn't seem fair that a small radio service like SomaFM has to pay all these additional royalties, when over-the-air stations who reach much larger audiences are exempted from paying them.
If you are in the USA, we would appreciate it if you could sign this online petition which will be presented to members of Congress.
It's important for us to let Congress know that independent internet radio is about to be forced out of business.
We need to keep our existing "percentage of revenue" royalty rate structure, or better yet, have Congress extend the exemption to internet radio stations as well as terrestrial (over-the-air) stations.
Thanks for all of your support for SomaFM in the past. We will do what we need to do to keep SomaFM on the air and broadcasting. We love you!
General Manager and Program Director
I don't think any of us want to lose the ability to run an online stream for a reasonable price, do we? Want to shut your stream down because you can't afford it? Want to lose your favorite station online? Many stations are just getting to the point where they can stream again after the last bump. Let's hope they don't go down again.
Lots more info on this subject is available on today's edition of the RAIN as well.
Send this note to a friend, either by copying and pasting (make sure you get the link for the petition right), or by clicking "Send to a friend" below.