Last Tuesday the RIAA gave an on-line presence to it's SoundExchange
royalty-payment
system, aimed at collecting fees from webcasters based on provisions
set up in the DMCA.
According
to The Standard, SoundExchange
is not yet authorized by the U.S. Copyright Office to collect
webcasting royalties. It is, however, "the sole agency for
collecting royalties... over satellite and cable services."
Nor are webcasting rates yet established. What has been detailed
so far is and agreement that 45% of the collected royalties will
go to the artists, and 50% will go to the copyright holder, with
the remaining 5% to be divvied up among "non-featured musicians"
and "non-featured vocalists," according to the site.
The establishment of this agency, however, is being protested
on several fronts. Artists groups such as the Future
Music Coalition, headed by Tsunami guitarist Jenny Toomey,
argues that the fact that SoundExchange is an RIAA entity, the
artists will invariably suffer financially.
According to an Inside.com
article, Toomy argues that "If there is only one collection
agency, it shouldn't be an organization which is funded by and
solely represents the interests of the five major labels."
Webcasters are also screaming about the apparent rates that are
going to be established. In September Broadcast.com
founder Mark Cuban told RAIN (here)
that the way the [webcasting] rates are being structured -- to
be collected on a per-song basis, ex post facto from 1998
-- signals nothing more than "a death certificate for 95%
of the [webcasting] industry."
According
to this Routers article, however, John Simson, executive director
of artist and label relation for SoundExchange, says that the
RIAA has tried to tailor licenses with Webcaster specifically
to individual situations, which mirrors RIAA presidents Hillary
Rosens' earlier comments to RAIN (here).
Two other issues are being considered. First, SoundExchange wants
to collect royalties on the temporary copy made in the RAM buffer
when a player downloads a stream -- effectively giving them a
second payment on nearly every song streamed over the Internet.
According to Inside.com, "whenever a copy is made, music
publishers... are owed a licensing fee."
The other issue deals with the treatment of electronic vs. material
copies -- i.e., how to govern an legal electronic copy of a song
so that it is not more restrictive than traditional media (you
can trade old CD's at used music stores, for example, but you
can't trade old digital copies), but also in a way that doesn't
promote excessive piracy.
Reprinted from Yesterday's Issue:
From The Industry Standard: "Despite tighter budgets
for many Internet companies and the reluctance of more-traditional
firms to move online, new advertisers continue to debut on the
Net.
"The number of companies advertising online for the
first time in the past six months grew 157 percent since January,
with 
more
than 1,000 new advertisers hitting the Web each month since March.
The flow of online advertisers has remained steady during the
past 10 months, growing an average of 14 percent each month. In
the third quarter alone, 5,489 companies advertised on the Web
for the first time, 87 percent more than the second quarter's
2,935 new advertisers.
"The increase in advertisers has not been primarily spurred
by dot-coms, but rather by offline companies, according to advertising
measurement firm AdRelevance...
Read the full article from The Industry Standard here.
From CNet News: "After failing to reach an agreement with
Napster,
EMusic unveiled
software that identifies
and blocks songs being shared by people using the controversial
music-swapping service.
"The program's technology identifies songs on Napster
that infringe the copyrights of the online music retailer's artist
and label partners, EMusic said in a statement...
"EMusic's software application searches for Napster
members that are distributing EMusic tracks. When 
an
infringing Napster member is identified, the individual will receive
a warning from EMusic and will be given 24 hours to stop distributing
the tracks.
"If the person continues to make the tracks available
via Napster, EMusic will notify the music-swapping company of
the infringement and ask it to block that person's account.
"Although Napster will not seek out those swapping
EMusic files, it has agreed to block accounts from sharing those
files if EMusic points them out, the music e-tailer said."
Read the entire article here.
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x
Okay, so EMusic is targeting the "online music shopper
who also uses Napster." But instead of converting them
to an "online music shopper who doesn't
use Napster," isn't it more likely that this measure
will turn an EMusic customer to a "Napster user who shops
for music anywhere but
EMusic?"
... |
From
ZDNet: "Napster is now watching the watchers.
"The San Mateo-based company will be monitoring just
what its competitor EMusic is doing with its new 'acoustic fingerprint
technology,' which the company 
unleashed
this week to stop Napster users from swapping its songs, Napster
CEO Hank Barry said...
"But the fingerprinting that EMusic is now using is
both 'not technologically feasible' nor consistent with the Digital
Millennium Copyright Act, which governs copyright on the Internet,
Barry said."
To read the entire story, click here.
From Advertising Age: "Streamers have become...the
providers of streaming audio and video for the Net that tout the
medium as the advertising vehicle of the future. The
question is when that future begins.
"'The critical mass is there,' said Stephen McHale, president-CEO
of Everstream....'The
key is aggregating it in a
way to present it to the agencies, and that's now starting to
happen'
as major companies (such as Interep
and Katz
Interactive Marketing) sell streaming audio ads.
"But Natalie Swed Stone, managing partner-director
of national radio services at Omnicom Group's Optimum Media Direction,
New York, said more than a little growth is needed. She predicted
streaming audio will not be a part of major national advertisers'
media mix for another 10 years
because of low levels of penetration in the fragmented market..."
"'Advertisers are not rushing [to streaming
audio]. I think that they have no reason to rush,' Ms. Swed Stone
said. '
Our 
model
is based on cost per thousand -- per thousand -- not per person.
It's millions that
we're used
to dealing with and [streamers] are bringing it to a much smaller
level...'
"Jupiter Communications analyst Marissa Gluck said
Web radio has an advantage now because it is still relatively
uncluttered compared with Web pages. '[Streaming audio] definitely
breaks through and is
more
memorable than banner advertising,' Ms. Gluck said."
Read the full article
here.
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