Web radio royalties silence broadcast pioneer


By Will Knight The first radio station to broadcast via the internet has shut down its online service blaming a new web radio royalty scheme for its demise. Californian station KPIG stopped its normal internet service on 18 July and a message on the station’s web site blames new internet radio levies. It is still broadcasting live music online, for which it does not have to pay extra royalties. The new royalty scheme was introduced in June by the Copyright Arbitration Royalty Panel, a department of the US Copyright Office. Under the royalty scheme, internet broadcasters must pay 0.07 cents per song, per listener, for the right to broadcast copyright protected music. On 20 October, broadcasters will also be asked to pay all the royalties owed for the last three years of broadcasting. Kurt Hanson, of the Save Internet Radio campaign, says this would mean paying hundreds of thousands of dollars in one lump sum, rather than the few hundred dollars broadcasters currently pay each month. “They have shut down because they genuinely fear being personally bankrupt,” Hanson told New Scientist. “Many stations will go bust and some may move overseas.” Over-the-air broadcasting requires royalties to be paid to only to the composers of the music. But the US Digital Millennium Copyright Act (DMCA), passed in October 1998, established that artists and record companies could also collect royalties on web broadcasts. This is because digital quality broadcasting was perceived as a threat to music sales. KPIG began broadcasting the world’s first internet radio service in August 1995. The station’s small local radio service was made available to a worldwide audience through the internet feed, gaining it unprecedented new popularity. This is not the first radio station to close its internet service as a result of the new royalty charges. The Radio and Internet Newsletter lists nearly 100 small broadcasters that have done the same since the new royalties were announced. Hansen says web broadcasters will appeal the royalty ruling and he hopes that further legislation could reduce the cost to small broadcasters. The message on KPIG’s web site reads:
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