U.S. House acts to help Internet radio

A couple of hours ago, the U.S. House of Representatives voted to approve H.R. 7084, (a bill sponsored by Washington's own Representative Jay Inslee) that will allow the performance fee collector SoundExchange to negotiate an alternative royalty agreement before the end of 2008 with any Internet radio service.

SoundExchange - which is the only organization designated by the federal government to collect and distribute royalties - has been trying to raise royalties for operators of Internet radio services to the point that would force them to go out of business - basically, a "bleed 'em until they die" strategy.

Last year, the government decided to hike rates for Internet radio operators, creating an immediate crisis that has yet to be resolved.

The SaveNetRadio Coalition explains:

A March 2, 2007, decision by the Copyright Royalty Board (CRB), a division of the Library of Congress charged with establishing performance royalty rates for “digital radio” broadcasters, increased rates for webcasters by an unjustified and unprecedented 300 to 1200 percent.

Since the Copyright Royalty Board (CRB) increase royalty rates for webcasters 16 months ago, there has been an immediate and devastating effect on Internet radio services. Three of the most-listened-to services (AOL Radio, Yahoo! Radio and Pandora) have either left the business, limited listener access to their services, or announced they are likely to shut down in the near future if royalties are not significantly reduced. Just as importantly from the perspective of the artists that depend upon Internet radio, recent Arbitron data demonstrates clearly that royalty-paying webcast listening has diminished substantially since the CRB decision.

Legislation introduced last year to correct the discrepancy between Internet radio and cable and satellite radio providers by establishing an equal rate for all digital radio – cable, satellite and internet radio – at 7.5% of revenue is still pending with more than 150 Congressional cosponsors. The Internet Radio Equality Act (S. 1353/H.R. 2060) was introduced in the U.S. Senate by Ron Wyden (D-OR) and Sam Brownback (R-KA) and in the House by Congressman Jay Inslee (D-WA) and Don Manzullo (R-IL).

H.R. 7084 passed the U.S. House at 8:29 PM:

Mr. Tancredo requested the following general leaves to address the House on September 28: Mr. Poe for 5 min and Mr. Jones of NC for 5 min.

H.R. 7084: to amend section 114 of title 17, United States Code, to provide for agreements for the reproduction and performance of sound recordings by webcasters

Motion to reconsider laid on the table Agreed to without objection.

On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote.

The legislation basically adds more time on the clock so Internet radio operators can reach a resolution with SoundExchange.

NPI applauds the passage of H.R. 7084 and urges the United States Senate to quickly follow suit. We call on our Northwest Democratic Senators Cantwell, Wyden, and Murray to help guide Representative Inslee's bill through the Senate as quickly as possible so it may be signed into law.