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Traditional radio stations have to pay for webcasts

4 August 2001 10:13 by Petteri "dRD" Pyyny

If you have followed the digital music industry in past couple of years, you've noticed many, many court fights between new Internet companies and copyright owners. But now there aren't very many easy targets, maybe Aimster and FastTrack left. But the thing is that digital multimedia as an industry is still very new and doesn't have regulations and therefor copyright owners like RIAA and MPAA want to set the rules so that they can benefit the most from new medium.

Federal court ruled Thursday that traditional radio stations that webcast the same program as they do over the radio frequencies (process is called simulcasting), must pay a separate fee for their webcasting rights in the U.S.. Currently radio stations pay over $300 million annual royalty fees to copyright owners like RIAA. By blocking radio stations from transmitting over the Net, RIAA and court basically hurt many local artists with this ruling, who normally get their only exposure through local radio stations -- and now when these local radio stations have webcasts, possibility that their music is heard also in other cities, increases.

RIAA hasn't told any solid reasons for its request to charge another fee for webcasting (except greed of course), but it seems very likely that it has one very good reason to do so; stations that operate only through Net. Webcasters are currently negotiating with RIAA and Copyright Office to set a national webcasting royalty rate for U.S. webcasters. And RIAA wants to charge much more from webcasters than traditional radio stations pay -- if this would continue, maybe Launch and other webcasters would consider setting up a small local radio stations and just simulcasting that stream as their default stream to avoid higher charges.

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