The Librarian of Congress on Thursday set music royalty rates for Internet radio at half of what a controversial panel had recommended but still left members of the young industry terrified that the payments would bankrupt them.
Under a 1998 law, Internet radio stations, or webcasters, are obliged to pay royalties to performers of songs. A panel concluded in February that the rate should be .14 cents per listener per song for Internet-only broadcasts and .07 cents for rebroadcasts of conventional radio stations online. The new ruling sets both rates at .07 cents per listener.
Librarian James H. Billington decided making a distinction between the two was arbitrary. But he also rejected webcasters’ request to make royalties a percentage of revenues.
“We have no choice but to fight this decision if we want to survive,” said Kevin Shively, director of interactive media for Beethoven.com. Options included further lobbying of politicians or taking the matter to court, he said.
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