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Chaffetz, Polis Introduce 'Net Royalties Bill.


Reps. Jason Chaffetz (R-UT) (pictured) and Jared Polis (D-CO) have introduced the "Internet Radio Fairness Act," which will change the way streaming royalties are calculated. Chaffetz said Internet radio is "barely hanging on" because it pays such a large proportion of revenues in royalties, and said the legislation will "level the playing field for Internet radio services by putting them under the same market-based standard used to establish rates for other digital services."

Polis said, "When I was in college, making a mix tape was the height of technology but fans can now legally make their own playlists in the cloud to share and enjoy. Our laws shouldn't penalize the innovators who made that leap and created jobs by forcing them to pay outrageous royalties that are far greater than their competitors.We should pass the Internet Radio Fairness Act now because it's what's right for consumers and our economy."

Internet radio royalties are established by a panel of copyright royalty judges under an unusual "marketplace" standard that has led to performance royalties considerably higher than those paid by other audio services; the bill would put streaming royalties under the same "801(b)" standard that considers a variety of factors and is used to calculate other statutory royalties, including those paid by cable and satellite radio.

Statements From Clear Channel, NAB

Clear Channel released a statement on the bill, saying, "We share the view of Representative Chaffetz and Senator Wyden that fundamental aspects of the system governing sound-recording licensing royalty rates are out of sync with the realities of the 21st-century marketplace and must be fixed. This legislation is an important part of that process. We believe that the rate-setting process and royalty standard for the [Copyright Royalty Board's] determinations must support rather than stifle the growth of digital music for the benefit of consumers, artists, and businesses -- helping consumers gain more access to their favorite artists, assisting artists in reaching as many listeners as possible, and enabling the digital music industry to flourish with a sustainable business model.

"We look forward to working with policymakers and business leaders in the coming months to develop the kind of fair music licensing rate setting royalty standard that benefits artists while reflecting both consumer preferences and the business realities of the 21st century."

The NAB also approves of the effort; the organization released a statement reading, "NAB appreciates the leadership of Reps. Chaffetz and Polis and Sen. Wyden and strongly supports legislative efforts to establish fair webcast streaming rates. NAB will work with the bill's sponsors and all interested parties to create broadcast radio streaming rates that promote new distribution platforms and new revenue streams that foster the future growth of music."

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(9/21/2012 4:36:22 PM)
A bi-partisan effort. Who'd a thunk it?
Good for internet radio. Not so good for terra. Let the whining begin.
Wait... I know. More de-regulation! Yeah! That's the ticket.

- Ronald T. Robinson

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