Sad Day in Federal Court for Indie Musicians

Cue the sad cornet playing the funeral march, please.  Bad news for indie musicians came out today.

As many of you know, as per the US Copyright Royalty Board decision that came into effect in March 07, webcasters are now required to pay royalty rates of almost twice to three times the former amount. 

To quote today’s article in Yahoo:

“Under a Copyright Royalty Board ruling in March, Webcasters will pay a performance royalty of $0.0008 for each listener of each song in 2006, rising to $0.0019 in 2010. The first payment, backdated to January 1, 2006, is due on July 15.

The new ruling means the six biggest Internet radio stations — Pandora, Yahoo, Live365, RealNetworks Inc., Time Warner Inc’s AOL and Viacom Inc‘s MTV Online — will pay 47 percent of their anticipated 2006 combined revenue of $37.5 million in performance royalties, said SaveNetRadio.”

The sad news is this act (which was in appeals in Federal Court) was announced today that it was denied.  So now has to take the issue to Congress.

In English, please?

So basically what this means for us little indie artists:  this ruling puts a great majority of our airplay venues out of business.

One might say, “Well isn’t it a good thing for you to get paid royalties every time they play your song?”

Well, yes of course we would love to get paid for our hard work.  However, the majority of indie artists never make it to major broadcast radio, (i.e. Clearwater Broadcasting).  We highly depend on these internet webcasters to spread our music to the world.  And a lot of these little webcasters are just common folk just like you and me who run their radio stations from their home.  Mandates such as this one by the Copyright Royalty Board will basically put them out of business because there is no way for them to pay the royalty fees.

Or even the bigger guys like Pandora will have to start charging their listeners a signup fee to utilize their stations, which defeats a lot of what their primary goal has been since the beginning – to provide free online streaming to listeners. I just attended a Pandora seminar in Seattle a couple of weeks ago and we discussed this possibility, though it’s not something they want to do.

Here is the full Yahoo article if you care to read:

Yahoo Article

Signed, an independent artist who will be effected by this ruling,

Jennifer Thomas


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