Slashdot Log In
The SoundExchange Billion Dollar Administrative Fee
Posted by
Zonk
on Sat Jun 09, 2007 02:31 PM
from the crushing-greed dept.
from the crushing-greed dept.
palewook writes "On June 7th, Yahoo, RealNetworks, Pandora, and Live365 sent letters to US lawmakers emphasizing they owe SoundExchange 'administrative fees' of more than $1 billion dollars a year. These fees would be paid for the 'privilege' of collecting the increased CRB royalties effective July 15th, unless the Internet Radio Equality Act passes Congress. SoundExchange, the non-profit music industry entity, admits the levied charge of $500 per 'channel' is supposed to only cover their administrative costs. Last year, SoundExchange collected a total of $20 million dollars from the Internet radio industry. Under the new 'administrative fee' RealNetworks, which hosted 400,000 unique subscribed channels in 2006, would owe an annual administrative charge of 200 million dollars in addition to the retroactive 2006 rate hike per song played."
Related Stories
[+]
News: Webcasters Call Bunk on SoundExchange DRM Ploy 109 comments
RadioFan writes "The settlement between webcasters and SoundExchange is starting to come apart at the seams, because everyone is realizing that SoundExchange wants to force DRM on Net Radio. DiMA, one of the largest Net Radio lobbyists, has fired back at Sound Exchange, calling them out for leveraging high royalty fees to push through DRM requirements that they failed to obtain in Congress via broadcast flag and anti-recording legislation. Was this whole thing a ruse to get DRM on net radio?"
[+]
Internet Radio's 'Second Chance' Bogging Down in House 105 comments
An anonymous reader writes "Wired is reporting that the Internet Radio Equality Act is failing fast in the House, with negotiations breaking down over fair pricing for internet radio broadcasters. 'A legislative setback could make it harder to dislodge the new fees, which took effect last month after a federal appeals court refused to postpone the payment deadline. With the threat of congressional backlash fading, SoundExchange could find little incentive to budge from its current position ... SoundExchange has already proposed changes that could relieve small and custom-streaming sites from charges they could not possibly afford to pay, at least in the short term. Many expect a small-webcaster deal to be done by early September, when Congress goes back into session. But the deal on the table hasn't changed since SoundExchange extended an offer in May to charge them 10 percent of gross revenue under $250,000, or 12 percent of gross revenues over $250,000, with a revenue cap at $1.25 million.'" All very cushy for SoundExchange. Wired also points out that this is the same organization illegally lobbying for terrestrial radio royalties through 'third party' shell groups.
This discussion has been archived.
No new comments can be posted.
The Fine Print: The following comments are owned by whoever posted them. We are not responsible for them in any way.
Full
Abbreviated
Hidden
Loading... please wait.
My heroes (Score:5, Funny)
Re:My heroes (Score:4, Funny)
There's always money to be made in the carbon offset business...
Parent
To put this in perspective (Score:5, Informative)
Parent
in fair comparison.... (Score:3, Interesting)
In other words, who gets what without the internet?
Just like a cancer (Score:5, Insightful)
Re: (Score:3, Insightful)
Re:Just like a cancer (Score:5, Insightful)
Parent
What's not mentioned... (Score:5, Insightful)
Re:What's not mentioned... (Score:5, Insightful)
This is always touted as one of Microsoft's lessons learned - be involved in the government. Part of this is probably due to a belief that the anti-trust lawsuit was a vendetta brought on by more politically savvy sour-grapes competitors. I don't agree. But I do think it was only a matter of time for Microsoft to get involved anyway.
Microsoft is a large entity with a vested interest in how the market behaves. And the market itself is large enough to touch on almost every aspect of our lives (its what "we" always knew would happen back in the '80s with our little hobbiest microcomputers waxing poetic about the future). With the market so important, Congress is going to get involved eventually... mainly at the prodding of lobbyists from other industries touched by the expanding IT market. It makes sense that Microsoft would decide to have its views put in the ears of Congress as well.
Does this mean Congress-critters are demanding payouts? I'm not so sure its exactly that (although I would expect it is accurate in some cases). But I am positive you're not going to be well represented if those that would represent your view are unaware of what that view is. Or even worse... people with an opposing view have managed to convince your favorite Congress-critter that reality lines up with their viewpoint (queue this post's theme song [youtube.com]).
Parent
I wonder what real will do.... (Score:5, Funny)
Only Americans will be silenced (Score:5, Insightful)
We'll still be able to listen to Russian stations.
Where's you're "In Soviet Russia..." joke now, bitches?
Re:Only Americans will be silenced (Score:5, Funny)
Parent
Re:Only Americans will be silenced (Score:4, Insightful)
Privacy in the US isn't what it was anymore.
Parent
Resposible Government, the anti-drug (Score:4, Funny)
SoundExchange to Government: I learned it from YOU OK! I learned it by watching you *sob*
SoundExchange runs out of the room while Government stares into the distance meaningfully.
no love lost with Real Networks, BUT - (Score:5, Insightful)
While I don't advocate someone blowing their office to flinders with a bomb or some other evil terroristic act, I am surprised that it hasn't happened yet (one would think that with all the loosely bound people in the USA, one of them would have freaked out by now and targeted them...)
What I DO advocate is that the RIAA and the MPAA and their associated organisations be banned and eliminated and the music and film artists and industry re-organise itself along more open and egalitarian lines.
RS
Re:no love lost with Real Networks, BUT - (Score:5, Funny)
You're going to jail for this!
While I don't advocate someone blowing their office to flinders
Fine, you're off the hook...
with a bomb or some other evil terroristic act
That's is: jail time!
I am surprised that it hasn't happened yet
Oh ok, you're a fine fella.
(one would think that with all the loosely bound people in the USA, one of them would have freaked out by now and targeted them...)
Effin terrorist! JAIL!
What I DO advocate is that the RIAA and the MPAA and their associated organisations be banned
Oh, banned. That's cool I guess.
Screw it, I'm calling the FBI on ya!!
Parent
Re: (Score:3, Funny)
{cough}http://www.imdb.com/title/tt0085959/ [imdb.com]{/cough }
Non-profit spending accounts ? (Score:3, Interesting)
I know here in Canada, charitable organizations have to spend something like 80% of their income on the cause, with the remaining 20% expected to cover administrative expenses and salaries. I could be wrong on the numbers but it's in the ballpark. There is also a limit on how long an org can sit on their money, so for example they couldn't raise 1 million in a year and siphon off the 20% over five years. If that weren't the case, everyone and their mother would have their own non-profit company as a tax-free retirement account.
And don't start telling me they're actually paying the artists. They're paying the publishers, the agents, the producers, the "everything up to 11" pop mix "engineer", and of course the lobbyists. Besides, SoundExchange's information is such a market driver that it's in the industry's best interests to have doped and skimmed numbers depending on who they're pushing that particular week.
Is this a prime example of a GetRich Quick scam? (Score:3)
It really looks that way.
The Fee is Per Channel... (Score:5, Insightful)
If Pandora has ten thousand listeners like me, that's twenty thousand stations times $500 per station is ten million dollars. That's probably enough to kill Pandora and any other customizable channel internet radio site. But if the internet radio site only had say five channels, that's only $2,500, easily affordable by a commercial site.
My conclusion from this little exercise is that the RIAA is out to kill customizable channels. They don't want you to learn about music on your own. They only want you to listen to whatever the latest pop sensation is. They want to eliminate choice and the extra expense of having so many artists. If they can make it so all you ever hear is the generic artist of the moment, that's all you'll know and all you'll buy.
This is all about control. RIAA wants to make sure they control not just your access to their artists but your ability to discover new artists not under their contracts. Internet radio is a growing force and a growing threat to their ability to pick what music you buy.
I can only hope that they have overreached; that the huge amount of money involved here makes their motives visible to Congress. And that Congress cares. That sure makes it sound like a lost cause, doesn't it?
Re:If you didn't vote Libertarian YOU ASKED FORTHI (Score:5, Funny)
Parent
Re: (Score:3, Funny)
Re:I'm so conflicted (Score:5, Insightful)
Parent
Re:dollars $ dollars (Score:5, Funny)
Parent
Re: (Score:3, Informative)