Digital Music Survives to Stream Another Day
Some momentous events occurred yesterday in the world of digital music that may help to keep your favorite internet and satellite stations pumping out the tunes.
First, the DC Circuit decided a case
between SoundExchange, the organization that collects and distributes royalties to copyright owners, and Sirius XM Radio, who intervened in the case, over the royalty rate that satellite radio must pay to play music for the years 2007-2012.
Owners of copyrights in sound recordings have an exclusive right to "perform the copyrighted word publicly by means of a digital audio transmission," 17 USC § (106)(6)
. Thus, in order to broadcast satellite radio, the broadcasters must pay a royalty to the copyright owner. If they can't agree on a royalty, then the Copyright Royalty Judges step in and set one for them.
That's what happened here. The CRJ set a rate of 6-8% of revenue,
which SoundExchange did not appreciate. The organization appealed, and
the DC Circuit upheld the rate after finding that the CRJ's decision
was neither arbitrary nor capricious.
The court did send the
case backto the CRJ for consideration of the royalty rate for copies
made in order to facilitate the broadcast, but overall the decision
seems like a victory for Sirius, and its subscribers who won't have to
pay more for their satellite radio stations.
Yesterday also saw
the end of a two year-long fight over the royalty rate for internet
radio stations. The dispute has been raging since 2007, when the
Copyright Royalty Board announced a massive increase in the rates that
internet radio stations must pay to secure the right to play
copyrighted music. Many small and non-profit music stations argued
that the new rates would force them to shut their doors.
long back-and-forth, SoundExchange agreed to a compromise and
established a two-tier system whereby bigger internet radio stations
will pay SoundExchange a percentage of US revenue up to 25% or on a
per-song-basis (whichever adds up to more.)
Smaller stations will fall under a different formula and end up paying a different percentage.
All in all, it was a good day for digital music providers and the music fans who rely on digital music to get their fix.See Also:
Webcasters, Music Industry Agree on Royalties (Wired