Last week, “Pureplay” webcasters and Sound Exchange came to agreement on royalty rates for the use of sound recordings by Internet Radio stations for the period from 2006-2010. The deal, and analysis of it’s benefits, have been well summarized by David Oxenford (the attorney that represented the webcasters) here, and by Kurt Hanson, Publisher of RAIN: The Radio and Internet Newsletter on his blog.
As Hanson explains, the deal benefits “webcasters who … who have aspirations of earning more than $1.25 million in revenues per year — but are not wholly-owned divisions of multi-billion-dollar companies (e.g., AOL & Yahoo and CBS & other terrestrial broadcast groups). Those webcasters, and some of the known parties in the group, are Pandora, AccuRadio, Digitally Imported and Radioio.
Like the deal negotiated by broadcasters with Sound Exchange earlier this year, this agreement saves these webcasters from further costly CRB (Copyright Royalty Board) negotiations, establishes performance royalty rates that are lower than the rates established by the CRB, and gives smaller webcasters fixed percentage of revenue rates until they hit annual revenue marks somewhere over a million per year.
While there are critics, there’s no doubt that this deal benefits the certain group that participated in the negotiations, giving them relief from CRB-established rates. Congrats to David Oxenford, Kurt Hanson, Joe Kennedy, Ari Shohat, Mike Roe, and others who participated in the negotiations – I know from previous experience that it’s a long and frustrating process. More importantly, it’s a very expensive process – other webcasters that benefit from this option owe thanks and perhaps more to the companies that stepped up to get it done.