internet radio royaties

The Librarian of Congress has announced the appointment of two new judges to the Copyright Royalty Board – marking a total change in the three judge board since the decision in the last webcasting royalty case (about which we wrote here). The two new judges are David Strickler and Jesse Feder. Mr. Strickler will serve through 2016, taking the position of Judge Wisnewski (who resigned about a year ago) as the economics expert required by the statute creating the Board. Mr. Stricker is currently Senior Counsel at a law firm in New Jersey, specializing in business litigation, according to his biography on the firm’s website, here. He also has a Masters Degree in economics, and is an adjunct economics professor as Brookdale College in New Jersey.

Mr. Feder takes the place of Judge Roberts, who was one of the original CRB judges and had worked in the Copyright Office in connection with the CARP process that set the first rates for webcasting back in 2002. Judge Roberts recently resigned from the Board. The position that Mr. Feder takes is required by statute to be filled by someone with Copyright experience. According to Mr. Feder’s online profile, he was the Director of International Trade and Intellectual Property at the Business Software Alliance, and previously held several supervisory positions at the Copyright Office and in the Library of Congress. His appointment, filling Judge Roberts’ seat, lasts only until 2014 (but he could be reappointed). Continue Reading Changes at the Copyright Royalty Board – Two New Judges Make for an All-New Board for the Upcoming Internet Radio Royalty Rate Setting Proceeding

The Copyright Royalty Board makes many important decisions, yet for the last several years, there has been a cloud over its operations, as there have been questions as to whether its members were constitutionally appointed (see our articles here, here and here). Well, the question is before the Courts again – this time squarely in front of the US Court of Appeals for the District of Columbia – a Court one step below the Supreme Court. The Copyright Royalty Board sets the royalty rates to be paid by Internet radio stations for the public performance of sound recordings, and in doing so, they have made some controversial decisions over the last few years. They also set royalties for other digital non-interactive music services, including Sirius XM, music services that come with cable and satellite television services, and background music services. The Board also oversees the distribution of funds that are collected for the retransmission of distant television signals by cable systems. It also sets the rates under Section 115 of the Copyright Act for the reproductions of musical compositions made by record companies when producing musical recordings or downloads, by digital music companies in connection with on-demand music services, and by wireless carriers in selling ringtones. 

The case before the Court involves a seemingly small matter – the appeal of Intercollegiate Broadcasting Services from the CRB decision setting default rates for Internet radio services that are not covered by one of the many Webcaster Settlement Act agreements (about which we wrote here and here). IBS essentially is objecting to the fact that the Board would not lower the annual minimum royalty fee paid by some of IBS’ smaller members below $500. But, in connection with its appeal, IBS raised the issue of the constitutionality of the appointment of the Judges, and the Court this week heard an oral argument on the issue – mentioning the rate questions only in passing while concentrating on the constitutionality of the appointment of the Judges.Continue Reading Constitutionality of Copyright Royalty Board Argued Before the US Court of Appeals – How Will It Affect Future Music Royalty Rate-Setting?

The recent settlement on Internet radio royalties between Sirius XM Radio and SoundExchange provides yet another option for commercial webcasters trying to determine the royalties to be paid for the public performance of sound recordings.  While the settlement is signed by just these two parties, it will be published in the Federal Register and be available for all commercial webcasters who comply with its terms – which will essentially be any webcaster who is not a "Broadcaster" as defined in the NAB Settlement, about which we wrote here.  As set forth below, the royalty rates available under this settlement are slightly lower for 2009 and 2010 than those set by the Copyright Royalty Board back in 2007, but slightly higher than those available under the NAB settlement.  However, in 2013-2015, the rates available under this deal are actually lower than those agreed to by the NAB, meaning that they present a better deal for webcaster expecting their audiences to grow in the next few years.

First, the most important issue – how much will it cost?  As with the CRB decision, the NAB deal, and the Pureplay deal (about which we wrote here) as it applies to large pureplay webcasters, the rates established by the deal are based on a "per performance" charge.   A performance is one song as listened to by one listener.  So if a song is played on an Internet radio station subject to the deal and 100 people are listening at the time the song is played, there are 100 performances.  The rates established by the deal are as follows:

           Year              Rate per Performance

2009                      $0.0016

2010                      $0.0017

2011                      $0.0018

2012                      $0.0020

2013                      $0.0021

2014                      $0.0022

                        2015                      $0.0024Continue Reading Details on Sirius XM and SoundExchange Settlement on Internet Radio Royalties – An Option for Some Commericial Webcasters

The US Court of Appeal for the District of Columbia has set the briefing dates on the appeal filed by various webcasting groups seeking review of the decision of the Copyright Royalty Board setting Internet radio royalties for the period 2006-2010 for the use of sound recordings (see our coverage of this controversy here, and