x Plans are coming together for the webcasting community's "Day of Silence", scheduled to take place next Tuesday, June 26th. Full details are available in yesterday's issue of RAIN here. To register your webcast as a participant in the "Day of Silence", e-mail us: feedback@kurthanson.com x

BY DANIEL MCSWAIN
Artists continue to vocalize their support for webcasters, asking Congress to protect the diversity of music and value that Internet radio represents to their careers and to their fans through a number of public events and initiatives.

Over 30 artists traveled to Washington D.C.alongside members of the SaveNetRadio.org campaign today to meet with more than 50 lawmakers for a series of meetings meant to underscore the importance of webcasting to their careers and to listeners. Similar to the message delivered at the May 1 "Hill walk", [previous RAIN coverage here] the visiting artists urged lawmakers to support the Internet Radio Equality Act to keep the webcast industry from being decimated by the CRB rates.

Today's artists' "Hill walk" comes on the heels of an open-air concert Monday on the lawn of the U.S. Senate.

Reps. Jay Inslee (D-WA) and Donald Manzullo (R-IL), the original co-sponsors of H.R. 2060 [pictured above], were both on hand at the event, as were a number of the artists visiting Congressional offices today.

Another example of the diversity of artists to be impacted by the CRB rates, a group of nearly 60 artists sent a letter last week urging members of Congress to "help save faith-based and Christian music on the Internet" by supporting the IREA.

SaveNetRadio.org members are also taking the initiative to sponsor activities in their own communities. Elise Nordling, director of the "Indie Pop Rocks" channel on San Francisco-based Soma.fm, has organized a concert event that will bring artists, webcasters and listeners together in support of the Net radio. The event is scheduled for July 1st at the Bottom of the Hill, and is co-sponsored by popular indie rock webcast BAGeL Radio.


Webcasters remain hopeful that a motion for a stay filed by various parties to the U.S. Court of Appeals could delay the implementation of the CRB rates until a solution is agreed upon. Today, the Department of Justice, speaking on behalf of the Copyright Royalty Board, officially opposed that motion for a stay, a largely procedural move that has no substantial impact on the appellate proceeding.

Webcast attorney David Oxenford wrote to RAIN in an e-mail: "Yesterday, I received the responses of the Department of Justice and SoundExchange to the Motion for Stay of the CRB ruling that we filed with DiMA and NPR...

"In case you were wondering, the DOJ is involved in the case as the representative of the Copyright Royalty Board.  In effect, our appeal is against the CRB, not SoundExchange.  SoundExchange is participating, as an intervener to support the CRB decision, but the other side of the appeal is actually the CRB. 

"That's the way it works in appeals of most agency decisions — appeals of the agency's decision are filed against the agency, not against the parties who might benefit from the decision."

Read Oxenford's Broadcast Law Blog here.

BY PAUL MALONEY
A select group of the webcast royalty issue's most high-profile advocates, including RAIN publisher and AccuRadio founder Kurt Hanson, will air some of their differences on an industry conference panel this week near our nation's capital.

The panel, called "Webcasting Royalties: The Battle Heats Up," is scheduled for Friday as part of the fourth annual Digital Media Conference in Silver Spring, MD. The discussion takes place on the heels of webcasters' "Day of Silence" announcement (RAIN coverage here) and as the industry enters the "home stretch" towards July 15th, when 2006 retroactive royalties are due.

David Oxenford of Davis Wright Tremaine LLP, who represents small commercial webcasters (and is a frequent contributor to RAIN) will moderate the discussion. The music industry will be represented by SoundExchange general counsel Michael Huppe, American Federation of Musicians associate general counsel Patricia Polach (above left), and SoundExchange  board member Dick Huey of Matador Records (pictured right). Joining Kurt in speaking for webcasters is Digital Media Association executive director Jonathan Potter and NPR governmental relations vice president Michael Riksen (at left).

Other panels RAIN readers may find of interest include "The Digital Evolution of the Music Business: What's Next?" (featuring Pho group co-founder Jim Griffin and Clear Channel's Eric Siebert) and "Mobile Media: The Next Big Thing Beyond Ringtones" (moderated by Ted Cohen). The conference keynote speakers are Photobucket CEO Alex Welch and filmmaker Robert Greenwald. Registration details are available here.

This week, the L.A. Times is featuring a series of "point/counterpoint" exchanges between RAIN publisher Kurt Hanson and SoundExchange and RAC board member Jay Rosenthal regarding numerous issues underscored by the CRB ruling, including the purpose and need for copyright, fair compensation to artists, and royalty structures that would allow the booming webcast industry to continue growing apace.

Today's installment, the last of the series, asks the question: "The entertainment industry’s legal successes against Napster, Grokster, etc., have failed to slow plummeting sales. How will cracking down on web radio be any different?" The articles were featured in this week's "Dust Up" feature in the Opinion section of the paper. You can read our excerpts from yesterday's issue here.

From the L.A. Times: "In their final exchange, Hanson and Rosenthal focus on the history of copyright lawsuits...

A smack in the head is what you should get!
BY JAY ROSENTHAL
"If I were you I would be a little put off by today's topic. It suggests that webcasters have a kinship with the online criminals from Grokster who hide from lawsuits and the authorities in the jungles of Vanuatu [pictured]... I really don't think that a 'free ride' webcasting community emulating the Groksters of the world should be viewed as offering a legitimate answer to plummeting sales...

"Do webcasters really want to emulate Napster and Grokster?... Do they really want to be part of a movement that has turned a generation of kids into a bunch of morally bankrupt punks who think they are entitled to free music? I don't think so, but sometimes I am not sure.

"To some this may sound crazy, but I sincerely am starting to hate the Internet. [A]ll I see is a tidal wave of artist abuse. And the thought of webcasters emulating the Groskters of the world, and being given a free pass just reinforces my view that the Internet is not becoming a beacon of light, but a cesspool of darkness...

"And now the question is why we don't allow webcasters to do the same thing as Napster and Grokster, but without protest. We should just back off...

"Anyone suggesting that webcasters be given a free pass because sales are still reeling after the experience of Napster and Grokster must believe that artists are lemmings racing for the cliff...

"This is no time to give into anarchy. We must stand for the proposition that the development of any new technology not incorporating the legal and moral obligation to pay artists for their music is an immoral and incomplete technology—deserving of nothing less than an energetic lawsuit, and perhaps a smack in the head."

Ay yi yi!
BY KURT HANSON
"...I think [today's question is] intending to ask whether it's in the music industry's best interest to respond to every new development with aggressive, hardball, take-no-prisoners lawyering...

"The best example of your industry's mode of self-inflicted damage—one that will be taught as a case study in business schools for years to come—is how you guys dealt with the original Napster...

"...The year in which Napster was at its peak was also the best year of album sales in the history of the U.S. music business!... Let me repeat: Your  best year ever!

"If you think like a lawyer, you see copyright infringement, so you file a $20 billion lawsuit (as you did) to try to stop it.

"But if you think like a marketer, you might observe that people were getting exciting about music again... and you would notice that sales were actually going up, and you might think, '...I gotta find a way to take advantage of this!'...

"So everyone who knew anything about technology told you, 'Don't shut down Napster... You'll be sorry! Don't do it!'

"But you could...so you did...

"Cracking down on web radio, as your industry is doing... is going to be another case study in business schools.

"This crackdown is actually even worse than the others, because in this case you guys probably really know that Internet radio is good for you. But you're lawyers—deal guys and litigators. Your natural instincts are to 'win' as big as you can. Like the scorpion that bit the frog that was ferrying him across the river, it's your nature.

"And the result that's only a month away? You'll kill off 80% of the industry, CD sales will go down an additional notch, and then you'll complain that CD sales are declining. Just as with the Napster lawsuit, you'll win but you'll lose...

Who asked for royalty-free webcasting?
"You wrote, 'And now the question is why we don't allow webcasters to use the music without payment.' That's a total mischaracterization! No one is asking that question!...

"I'd like to end my piece of our conversation for the week with one final story:

"Woman's caught in a flood, clinging to a tree. Two kids come by floating on a door, offer to help her; she says, 'No thanks, God will take care of me.' Big dog swims by, gets close to her in a helpful way; she says, 'No thanks, God will take care of me.' Woman drowns. She gets to heaven and asks God, 'Why didn't you take care of me?' God says, 'What? I sent you a two kids, a door, and a dog!'

"Now the record industry is complaining that sales are in decline. But God has created MP3 players that hold 20,000 songs. Plus introduced a new form of distribution system—download sales—that removes all of the costs associated with the shipment of physical goods. Plus created thousands of new radio stations in hundreds of 'long tail' formats... Record industry says, 'No thanks, I'm a lawyer; I'll litigate.' Record industry dies. It gets to heaven (maybe) and asks God, 'Why didn't you take care of me?' God says, 'What?!? I sent you iPods, download sales, and Internet radio!'"

Read the entire article at the L.A. Times.

Here's more feedback on the dialogue between Kurt Hanson and Jay Rosenthanl in the L.A. Times last week...

"The entire government is supposed to serve the public interest..."

"Your dialog should be the jumping off place for a serious public discussion.."

"He just told the Internet broadcasting community to go fly a kite..."

"They just want us to go away..."

"You're lecturing webcasters about poor business models?.."