Pandora Agrees to New Royalty Plan That Charges Heavy Listeners, Live365 Responds
Depending on who you ask, Pandora's agreement to reconfigure their business plan based on an increase in royalty rates is either a shrewd business movie, or the first toll of the death knell for internet radio. Pandora has emerged from the royalties battle standing, but shaken.
"Live365 believes these smallest of webcasters, micro-webcasters, should have the same benefits as the major players have secured. However, certain hurdles built into current deals end up costing these webcasters the highest rates. As an example, today's reduced rates for a 'small' pureplay webcaster requires a $25,000 upfront payment, [which is] more than these micro-webcasters can earn with their limited hours. The previous SX microcaster offer was actually the same rates as full CRB rates. The unintended effect of these high hurdles on tens of thousands of small webcasters is an increase in piracy as it's easier to just go around the rules, with SoundExchange having little or nothing to do with enforcement. How did you get your music before Apple came up with a 99 cent legal download?
Therefore, in support of this beneficial class of micro-webcasters, reducing piracy and increasing royalties, with a low hurdle, legal alternative, Live365 has submitted to SoundExchange a rate proposal for consideration. It not only provides these webcasters the same reduced rates others benefit from, but leverages webcasting service aggregators like Live365 and others to assist SoundExchance with the administration, royalty collection and payment, full census reporting and compliance for tens of thousands of these tiny stations."
No word yet on how this is going to play out, but stay tuned.