noWax

The US Copyright Royalty Board recently dropped a bombshell on the webcasting market, affecting American podcasters and Internet radio. The new announced royalty rates pretty much make the Internet radio model unworkable. The rate increases over the coming years but for 2007 they are $0.0011 ($0.0019 in 2010) per track streamed to one user. RaIN (Radio and Internet Newsletter) have worked out that for one month this would cost the AOL radio network $1.65m. Hmm, that’s a viable model then.

When making these decisions they ignored the International Webcasting Association and other bodies and just listened to the R.I.A.A associated Sound Exchange. It’s obviously sensible to ignore the people in the industry that know about Internet radio and listen to the people who are constantly throwing the rattle from the pram suing every 12-year-old girl they get a postal address for. This could kill Pandora (based in the U.S.) and make Last FM the only choice for social networking radio. The R.I.A.A. are soon going to be more unpopular than the tax man.

Someone has got to work out a model that works for music consumption in the digital age. Everyone has been saying this for a long time now - the old industry models don’t apply to the way we currently consume music and other pre-recorded media, something new is clearly needed. Why then, do the powers that be cling onto the past and force people into non viable models? How will this move us forward?