The SoundExchange Billion Dollar Administrative Fee 127
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."
in fair comparison.... (Score:3, Interesting)
In other words, who gets what without the internet?
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.
Re:It's sad... (Score:3, Interesting)
Re:Just like a cancer (Score:3, Interesting)
Wow! That smells illegal. I have not followed in as much detail as I need to, but I had a feeling that what was going on was cartelish. For an organization to be allowed to have fiduciary powers over any or all of a non-granting principal's monies and then be allowed to force that principal to pay a fee (extortion?) to collect those monies does not seem even plausibly legal. (IANAL)
At the very least the RIAA ought to be forced to surrender whatever fees they collect to the parties that have not signed on with the RIAA or be forced to return those unrepresented fees to the ones they collected the fees from. Whatever the outcome, the RIAA ought not have collected those fees in the first place, nor be allowed to keep any of those fees they have collected without permission from the copyright owner.
Do I sound redundant yet? ;-)
InnerWeb