We've announced our first set of speakers for this year's annual RAIN Las Vegas Summit. Head over to our Summit page for details about the all-day event, to be held Monday, April 16 at the Renaissance Las Vegas Hotel.

From David Oxenford's BroadcastLawBlog: "Two press releases on the Internet radio music royalty controversy were issued late last week from groups appealing to musicians — and they couldn't have been more different in tone.

"The Future of Music Coalition... released a well considered position statement [here] finding that webcasters — especially small commercial webcasters and noncommercial entities — 'represent a rich and diverse set of listening opportunities' which provide opportunities for musicians by exposing listeners to music that is not heard elsewhere... FOMC urges SoundExchange and the webcasters to come to a settlement that will preserve webcasting while fairly compensating musicians.

"By contrast, SoundExchange argues in its press release [in .pdf format here] that some webcasters are acting in bad faith in arguing that the rates are too high — and are 'engaged in a campaign of misinformation about the process, the decision itself, and the impact of the decision on the participants.' The press release itself is subtitled 'Suggests Some Webcasters Not Telling the Truth About the Royalty Process.'..

"The only misrepresentation cited by SoundExchange is the claim by webcasters that the process which arrived at the rates was unfair. However, as pointed out by... the Radio And Internet Newsletter site, here and here, a decision that overlooks its real world effects can fairly be characterized as being unfair. Information about the real economics of the industry, which SoundExchange may not have appreciated, demonstrates that unfairness.


"$500 million pie" doesnt' exist!
"In other forums directed to musicians, SoundExchange President John Simson [right] has posted a more detailed statement... [and] that Internet radio revenues have increased in recent years from $50 million to $500 million (implying that these revenues allow webcasters to pay the new royalties).

"That $500 million figure apparently came from a widely quoted report recently released by an analyst at JP Morgan [in RAIN here]. However, that analyst, John Blackledge, last Thursday stated at a Jupiter/Kagan Conference on Radio and Television Values and Finance that the actual revenues from Internet Radio were in the $50 to $100 million dollar range, not the $500 million dollar number that many press reports seized on. That higher number included all sorts of revenue not attributable to the types of digital audio music services subject to the statutory license.

"In fact, there is nothing in the CRB's decision that would demonstrate that any Internet radio company is making money off of its nonsubscription streaming operations -- and Blackledge's clarification may show why -- that royalties alone eat up the industry's revenues even at the levels in place prior to the release of the CRB decision.


Direct deals would cut performers out completely
"Another interesting take on the impact of the decision on musicians comes from an interview with Jonathan Potter [right], the President of the Digital Media Association, in the March 27 issue of Royalty Week Magazine [covered in RAIN here]...

"While Jon is clearly an interested party in the CRB litigation as his organization represents the largest webcasters, his point is one that is difficult to argue with -- that the royalty decision will drive webcasters to cut direct licensing deals with the holders of copyrights in sound recordings. We suggested the same thing, here. However, Jon makes the good point that such deals would be outside the SoundExchange process, and thus the statutory requirement that half the royalties go to the musicians on the recording, would not apply.

"The copyright holder — usually the record company — would get to keep 100% of any directly-negotiated royalty.


Musicians should consider where their loyalties lie
"In essence, a webcaster could get a deal from a copyright holder at just over half the current royalty, and the record company would recognize more from the deal than from the statutory royalty. A win-win for the record company and webcaster who can afford to deal with each copyright holder, but a loss for musicians and small webcasters who can't afford the transactional costs of negotiating with all the copyright holders whose music is necessary for their service i.e. the very webcasters that the statutory royalty was meant to protect.

"Wheels within wheels, but it would seem that musicians should carefully consider where their loyalties really lie..."

Read this entire entry from David Oxenford's BroadcastLawBlog here. Oxenford is a Washington, DC-based partner with Davis, Wright, Tremaine. He represents a group of webcasters including AccuRadio.

BY DANIEL MCSWAIN
Arbitron and comScore have released their latest Online Radio Ratings studies for the month of January.

January's ratings include the addition of a new network to the panel: a group of independent webcasters that have banded together under the name "RL Select".

The network , which is made up of GotRadio, Big R Radio, and 181.FM, is aggregated by the Ronning Lipset Radio ad rep firm.

According to a press release: "By aggregating independent broadcasters together under one umbrella, Ronning Lipset Radio... is allowing this select group to produce  reliable audience measurement data..."

The "average quarter hour" estimate, or AQH, is defined as the  estimated average number of persons tuned to a channel  for at least five minutes during a 15 minute period. It can be understood as "the number of people listening to a station at a specific moment."

January 2007

comScore Arbitron Online Radio Ratings

Rank	Station/Network	AQH	Weekly Cume
1		164,800	2,098,900
2		159,400	1,448,300
3		82,000	1,176,300
4		67,900	786,200
5		21,200	712,100
Total:		413,300	5,045,500

comScore Arbitron Online Radio Ratings

Rank	Station/Network	AQH	Weekly Cume
1		295,000	1,441,200
2		248,600	888,500
3		151,000	963,400
4		117,100	546,300
5		36,400	421,100
Total:		812,100	3,854,801

"As broadcasters explore ways of monetizing the Internet, they’re putting more resources behind their efforts.

"John Rosso is senior vice president, affiliate relations for ABC Radio Networks. The company recently added 'and digital media' to his title.

“We are extending all of the ABC radio brands into the digital world,' he said. 'The first thing we want to  do is increase the quantity and quality of the Internet content for all our shows...

"Rosso also sees mobile technology as a growth area.

“'We’ve already gotten into that with Radio Disney and ESPN via Sprint,' he said. 'We have a strategy to stream local stations on mobile phones,'...

"But this is a road with plenty of blind turns ahead.

“The biggest obstacle we face is fear,' said Rosso. 'Broadcasters fear we will cannibalize our on-air audiences, although that fear is fading. Next is the fear of cost, and third is the whole intellectual rights issue. We need to be  very careful with this content to make sure we have the proper rights to all the components because the potential liability is huge. Given the litigiousness of our world, it’s important for every company to consider this.'"

Read the entire article at Radio World Online.