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Your favorite Internet radio station may be unable to afford what it will cost to continue operating with recent skyrocketing copyright royalty rates. This harsh reality comes after a March 2, 2007, decision issued by the Copyright Royalty Board (CRB), a three-member panel affiliated with the Library of Congress, which adjusts royalties paid by commercial and noncommercial webcasters. I am concerned that the changes imposed by the CRB’s decision are ill-conceived and will severely threaten the diversity and accessibility of Internet radio. In response to this industry threat, I introduced the Internet Radio Equality Act, H.R. 2060, which would reverse this decision and save Internet radio as we know it today.
According to the recent ruling, which is retroactive beginning January 1, 2006, and commences through December 31, 2010, commercial and noncommercial webcasters would be subject to an increase in royalty rates from $.0008 per performance in 2006 to $.0019 per performance in 2010. The new royalty rate amounts to a 300 percent increase for the largest webcasters and up to 1200 percent increase for smaller operations. Small webcasters, under the previous rules, had been able to pay royalties on a percentage of their revenue rather than on a per-song listener basis. Now, the new rules under the CRB will force many small webcasters to pay royalties that exceed their total revenues. Even mid-sized web broadcasters will have to severely limit the availability and variety of their programming in order to afford these copyright royalty demands. These new rates have the potential to decimate Internet radio.
My bill, H.R. 2060, would negate the CRB’s ill-conceived March 2 decision and change the royalty rate-setting standard that applies to commercial Internet radio royalty arbitration so that it is the same standard that applies to satellite radio. For public radio, the bill sets a royalty standard designed for noncommercial entities. I am committed to ensuring that this narrow-minded decision is reversed before radio broadcasters are forced to begin paying their retroactive royalties on May 15, 2007. I will ardently pursue this measure in the Committee on Energy and Commerce, where it has been referred, and fight for passage on the House floor.
Like you, I value Internet broadcasting and the wide range of audio and video services available online. Maintaining diversity and freedom in Internet broadcasting is essential toward ensuring that the Internet remains a free and reliable source for music, news and other valuable programming. I believe strongly that it is the responsibility of Congress to promote media diversity, and I will continue to work to ensure that the Internet remains accessible and affordable.
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