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Appeals court denies stay on radio fee hike

updated 04:20 pm EDT, Thu July 12, 2007

Radio fee stay denied

The District Court of Appeals for the District of Columbia, Reuters writes, has ruled against a stay on royalty increases for Internet radio stations. Under a March order by the Copyright Royalty Board, stations are expected to pay $0.0008 per each listener of a song in 2006 and onwards; by 2010, this rate should reach $0.0019.

Royalties dating back to January 1st 2006 are due starting July 15th, but smaller stations such as SomaFM have said that they may effectively be driven out of business. According to the organization SaveNetRadio, even the six biggest networks (Pandora, Live365, etc.) will lose 47 percent of their revenue from last year.

SaveNetRadio's one remaining hope is the US Congress, which it says has received over 500,000 pleas to reduce royalties to 7.5 percent of a company's total revenue -- on par with satellite radio. A proposed Internet Radio Equality Act would annul the CRB's decision entirely.

The smallest Internet stations should, in any case, effectively be immune from royalties, since the collection group SoundExchange has temporarily agreed to defer payments for stations making less than $1.25 million per year. These stations may be brought under industry purview at a later time, however.

by MacNN Staff




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