It's high PR season for Internet broadcasters and record labels. Royalty rate hearings are in the rebuttal phase and parties are jockeying for position before the new rates are announced later this year. Yesterday indie trade group (A2IM)American Association of Independent Music released a statement on the Copyright Royalty Board decision for performance royalties paid by online broadcasters. While indies are concerned about getting fair performance royalties, they understand it is in their interest that web broadcasters, which play indies far more than terrestrial radio, be given a chance to grow.

In this segment, the group wisely acknowledges the dual challenge.

A2IM believes that independent labels and artists need to be fairly compensated for their creativity and investment, but is concerned about the economic challenges facing Pure Play webcasters. For this class of broadcasters, A2IM continues to support SoundExchange's continued effort to find a statutory licensing solution structure that allows growth and development of these nascent businesses, without devaluing an important future income source for the small- and medium-sized businesses and artists that make up the independent community.

In its April 2008 newsletter, A2IM expressed concern over the possibility of increased mechanical rates.

Our A2IM members are split on the issue of what future mechanical royalties should be. Some label members own publishing rights while other label members do not. The new rates will affect every music sale/stream by a label member. ... Combining the current mechanical rates with the rise in cooperative advertising amounts being required by the consolidated retail marketplace presents results that are the main issue.

In a statement released today (I really wish these groups would post these on their website so I could link to them in their entirety), the Digital Media Association (DiMA) rallied behind statements from Senators Patrick Leahy and Senator Dianne Feinstein supporting fair Internet royalties ("fair" as in relative to other broadcasters). The group had this to say about Senator Sam Brownback's proposal that the Senate Judiciary Committee consider the Internet Radio Equality Act:

It has been a frustrating year since the Copyright Royalty Board established astoundingly high royalty rates for webcasters. Months of negotiation with SoundExchange have yielded little progress – SoundExchange’s latest offer just days ago would require webcasters to pay many multiples of what cable and satellite radio currently pay, an outcome that many webcasters view as simply unacceptable. ...

We look forward to working with Sen. Brownback, Chairman Leahy, Sen. Wyden and Sen. Feinstein, and other leaders in Congress who support fair compensation to artists and fair competition among radio programmers.

Extra credit reading:

• Wikipedia page for the Internet Radio Equality Act
• Save Internet Radio had a blog post today on recent developments
• For a good introduction to how we got to the present day, read this March 2007 article from the Washington Post.

Posted by Glenn at 4:15 PM | Link
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Billboard.biz just ran an article on a confidential meeting held today in New York City. SoundExchange will reportedly cap the per-station or per-channel royalty at $50,000. Under the original CRB decision, a $500-per-channel could have spelled doom for stations with a high number of channels. "The deal was reached late today in New York during a meeting at which representatives from all the major labels and the large digital services were present, according to the source."

There have been so many developments in this webcasting royalties issue that it's been very hard to keep track. If you want one-stop shopping for news related to the topic, I suggest all posts tagged with "Save Net Radio" at Wired's Listneing Post Blog.

Posted by Glenn at 2:42 PM | Link
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• LiveNation and Ticketmaster will not renew their relationship when the current contract expires at the end of the year. That will open the door for LiveNation to beef up its own ticketing operation (which recent acquisitions should allow it to do). Sources say the 14-15 million LiveNation event tickets purchased annually give Ticketmaster around $100 million in service fee revenues. (Billboard.biz)

• SoundExchange is allowing small webcasters -- defined as those with annual revenues of $1.25 million or less -- to pay 10-12% of revenue instead of the per-performance royalties set earlier this year. The deal includes a usage cap to "ensure that this subsidy is used only by webcasters of a certain size who are forming or strengthening their businesses." (Radio Ink)

• It's goes without saying, but at least somebody included it in an article. From Bloomberg News on Wal-Mart MP3 downloads from WMG and UMG: "Kevin Swint, Wal-Mart's manager of digital media, said the company is in talks with Sony BMG Music Entertainment and Warner Music Group Corp. as well as other record companies to offer their products in the same unprotected format." (Bloomberg)

• The second annual, five-day Next Big Nashville music festival, a showcase of Nashville's rich music scene, will run September 5-9. Local bands The Pink Spiders, De Novo Dahl, Ghostfinger, Wax Fang, Jeremy Lister, The Features and Freedy Johnston (he recently moved to town) are among the 130-plus bands that will play at ten venues. A five-day wristband will cost only $30. (Next Big Nashville)

• Little Big Town will give away its new single, "I'm With The Band," as a free download tomorrow at the band's website. The freebie will start at midnight E.T. and last 24 hours. (Country Weekly)

• Can you tell something about an artist's longevity from last.fm plays per listener? I would think so, and after compiling a long list of numbers, David of Digital Audio Insider thinks plays/listener, though a crude metric, shows quite a bit about long-term potential. "The Last.fm numbers don't look good for the long-term prospects of the Bravery and the Walkmen. Of all the acts in this analysis with Last.fm audiences of more than 100,000 listeners, these were the only two with less than 20 plays per listener. My suspicion is that bands that receive a fair amount of mp3 blog attention might have their ratios pulled down because there are a large number of Last.fm listeners who have only heard a single track or two via a music blog." (Digital Audio Insider)

• BusinessWeek's Ronald Grover writes about Universal Music Group's International Music Feed, a reaction to MTV's lack of video play. The potential is there, he writes, but the viewers aren't. "According to IMF, it gets an anemic 47,474 unique visitors a month to its Web site. And while it has 17 music channels on the online TV site Joost, and two channels on British cell-phone company Vodafone (VOD), it has just about no U.S. TV presence. ... It ain't MTV, that's for sure. But give Universal credit for trying." (BusinessWeek.com, via paidContent)

• The Rhapsody America joint venture is a case of one company having the brains and one company have the brawn. Will it bring mobile music into the mainstream? (Big Red Horseshoe)

Posted by Glenn at 10:46 AM | Link
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• SoundExchange, the performance rights organizaion that collects digital royalties, released the results of a study it funded that was done by Dr. Yoram Wind, a marketing professor at the Wharton School of Business. Its finding: "Music is key to survival of satellite radio." In terms of dollars and cents, the study found subscribers would be willing to pay only $6.15 per month for a satellite service without music, as opposed to the current $12.99 per month. The study's point is clear by the end of the press release. SoundExchange wants at least ten percent of satellite radio revenues. CRB, XM and Sirius, it says, have proposed a rate of less than one percent of their total revenues for the next six years. (Read press release)

• Bids for Clear Channel Communications are reportedly due in the coming days. The country's largest radio company is considering plans to be taken off the market and has hired Goldman Sachs to help look at its options. (Read Reuters article)

• An article on All Angels, the "world's first female classical supergroup." Universal signed the group -- made up of four teenage girls -- to a £1 million, five-album deal. Their debut album comes out next week in the UK. (Read article at The Scotsman)

• Warner Bros. Nashville will sign the winner of "Nashville Star 5." The lastest season of the country "American Idol" starts January 11th. (Read article at Reality TV Magazine)

• Hypebot interviews a Tarek Al-Hamdouni of J Records to find out about the label's online marketing efforts. Read parts one and two.

• RIP Gerald Levert. (Read AP article)

Posted by Glenn at 5:11 PM | Link
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