 Internet radio is in peril. If you listen and love it as I do, you will want to read this article about the new rules that may put Internet radio out of business. I'll also tell you what you can do to help.
I recently wrote an article about Pandora.com, an Internet radio station that provides a wonderful way to listen to music you love. It is estimated that there are approximately 50 million Americans who listen to Internet radio each month. I know that you liked Pandora.com because many of you emailed me saying thank you for making you aware of such a great Internet radio website.
Like terrestrial radio, Pandora and most other Internet radio stations are free. Like other types of radio, they pay a fee for the privilege of broadcasting the music. Last month the Copyright Royalty Board changed rates for Internet radio from a percentage of revenue to a per-song, per-listener fee. The result will be a rate hike of between 300 and 1,200 percent. The fees imposed by this legislation are so high that they endanger the very existence of Internet radio.
I am not usually politically inclined, but after talking with Tim Westergren, the founder of Pandora.com on my latest podcast, I decided to make my readers aware of the Internet radio situation. Tim and most of his staff are musicians. They want musicians to get paid for their work, but if the new fees stifle Internet radio, everyone including the musicians will lose.
The new royalty rates are irrationally high. They are more than four times what satellite radio pays. Because of a wrinkle in the law, broadcast radio doesn't pay these fees at all. The royalties rates have been made retroactive to January 1, 2006 and are payable on July 15, 2007. Past due royalties of this size have the potential to bankrupt most Internet radio services. Left unchanged, these new royalties will virtually kill every Internet radio site, including Pandora.
When I asked Tim Westergren why they were doing this, he said, "because they can". It seems that they are afraid of the changes that the Internet is making to radio listening and are looking for all the revenue they can get. In my humble opinion, Internet radio doesn't cut into the territory of terrestrial or satellite radio. I happily listen to all three and I now listen to much more radio than I ever did before.
More than a million Internet radio lovers have already joined the fight against these unfair charges. This ground-swell of support has resulted in a new bill being introduced in Congress. It is being called the Internet Radio Equality Act, H.R. 2060. The SaveNetRadio.org website at http://www.savenetradio.org/ will give you instructions on how you can support Internet radio. Right now they are asking everyone to call their congressman to support the bill. If you don't know your representative's telephone number you can just enter your zip code at the SaveNetRadio website and you will get both the telephone number of your representative and talking points for your call.
If you have never listened to an Internet radio station, you had better do so now before the lights go out. Check out Pandora where you can create your own radio stations with different types of music and discover new artists at the same time. After listening for a day or two, you will see why so many of us are Internet radio fans.
To hear my podcast interview with Tim Westergren about Internet radio, listen to Compu-KISS Podcast 30. You don't need an iPod to hear these. Just click on the LISTEN button. Remember to voice your opinion about Internet radio by visiting www.savenetradio.org.
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