Royalties

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This page is a repository for pertinent information about royalties due to musicians from webcast performance such as Whole Wheat Radio. Think of it as a resource for small webcasters to use in figuring out a way through the maze of confusion concerning royalty payments. Perhaps we can also use it as a page to actually draft up the legal agreement we want to present to artists.

The following is not intended as legal interpretation or to be taken as legal advice.

Royalties info for WWR artists

Artists have until June 30th to claim SoundExchange money.

List of unpaid artists It might be worth going through the list to see if anyone has contacts with any of the artists in the list and let them know you, as an Internet Radio listener and not the people that they are paying (through royalty deductions) to work for them are making them aware of the cut off date for payments. They obviously they can't find Kraftwerk because they're on some small label. Anyone heard of EMI? :)

Update: From Sound Exchange's list, by using nothing more than Google, I've managed to contact at least a dozen artists and made them aware of the situation. There's a few of us "webcasters" at L***365 who are doing the same. Big Tom


Discussion on WWR

Discuss WWR and royalties on the "Royalties" talk page. (Click this link).

Copyright Royalty Board (CRB)

(Copyright Royalty Board website)

Before CRB decision

2003 - RIAA spins off SoundExchange, a non-profit organization to collect and distribute web royalties (Incorporated September 22, 2003 - previously unincorporated division of the RIAA)
2004 - interview with SoundExchange director

October 13, 2004 interview with Neeta Ragoowansi, membership director for SoundExchange exerpt:

"SoundExchange will pay royalties regardless of whether artists and labels have become actual "members." When we have good payee information - a name and an address -- we can pay out the royalty, even if these artists haven't formally become members. To date, we've processed over 200 million performances that can be attributed to approximately 40,000 different artist accounts. Since we don't have good payee info on most artists, however, we can't pay them.

"So you can see why it's really important for performers and labels to register with SoundExchange as soon as possible and claim their royalties. Artists, however, should not only register with SoundExchange but be actual members so they can reap the benefits of membership, one major benefit being the foreign performance royalties that can only be distributed through SoundExchange if the artist has designated SoundExchange (through its membership agreement) to do so on his or her behalf."

CRB decision

Current regulations

On March 1, 2007 the CRB made its decision setting performance royalty rates for Internet radio from 2006 to 2010. An appeal to the rate structure was denied.

By entering into agreement with SoundExchange artists give SoundExchange the authority to collect royalties from webcasters in their behalf. SoundExchange agrees to pay the artists the collected royalty or a portion thereof.

Impact and proposed changes to current regulations

"Internet Radio on Death Row" by Doc Searls on 2007-03-08
Daily Kos (4/24/07) The recent U.S. Copyright Office ruling regarding webcasting designated SoundExchange to collect and distribute to all nonmembers as well as its members.
April 26, 2007 - Internet Radio Fairness Act Introduced to Nullify Copyright Royalty Board Decision
April 27, 2007 - SoundExchange response to Internet Radio Fairness Act (PDF)
April 28, 2007 interview with Pandora web radio founder - The End of Internet Radio?

I think musicians really need to pay attention to this, and not be passive, and get smart and get active. This is a watershed moment. There’s this budding vibrant online radio phenomenon that’s got massive energy and enthusiasm, and is growing in leaps and bounds. And it’s a new voice for the newly empowered creative class. Musicians are now able through technology to produce this huge volume of really good music. There’s no room for it in broadcast radio, but there is in this new medium. And it’s under threat right now, in a big way.

April 30, 2007 - ""Royalty Statistics Disprove Sky Is Falling Claims of CRB Critics - SoundExchange press release (PDF)

Resources

Broadcast Law Blog
SaveNetRadio - Webcaster organization
Save Our Internet Radio - blog
Future of Music Coalition
Recording Artists' Coalition

Examples of other sites' legal agreements

  • CNN - notice how regular people, if they upload a video that may be seen by millions of people, agree that CNN does not owe them anything for the use of it
  • LastFM - artists agree to let them play their music without LastFM paying any royalties
  • Examples of release forms used on the web

Other

Royalty collection/distribution organizations

SoundExchange
American Society of Composers, Authors, and Publishers (ASCAP)
Broadcast Music, Incorporated (BMI)
Society of European Stage Authors & Composers (SESAC)
Recording Industry Association of America (RIAA)

Terminology

Aggregate Tuning Hour (ATH)

"Aggregate Tuning Hours or ATH refers to the total hours of programming transmitted to all listeners during the relevant time period. Thus, one hour of programming transmitted to 20 simultaneous listeners would produce 20 aggregate tuning hours or 20 ATH. The number of ATH in a month could be calculated by multiplying the average number of simultaneous listeners by the average potential listening hours in a month or 730 (i.e., 365 days in a year multiplied by 24 hours in a day then divided by 12 months). Applying this calculation to an average of 20 simultaneous listeners yields 14,600 ATH per month." (quoted from United States Copyright Royalty Judges: Docket No. 2005-1 CRB DTRA)

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