February 2002
Killing the streaming.

What price webcasting?

We held off this month's comment in anticipation of a US ruling regarding the copyright charges to be levied for music streamed on the Internet, an issue of significant importance not only to Internet-only webcasters but also to many terrestrial stations both because of major amounts they may owe for the period back to 1998 and also as they will have to decide whether to continue to stream their signal at all.
Our feeling on seeing the details so far is that the recording industry would rather have no streaming apart from that which it can control and that many radio stations could do without this problem in the current economic climate, one far removed from the heady days when dotcoms with no reasonable chance of making a profit were valued at billions in a surge of greed and folly.

The bill from the past

The amounts due for past streaming are of major importance because, just as they are having a fairly thin time, stations may have to put aside significant funds to go into the coffers of the recording companies for any music streamed until the end of March this year. For streaming after that, new agreements can be negotiated.

The exact amounts are going to be difficult, if not impossible, to calculate for many stations and certainly impossible for outsiders without access to station logs and server information. The maths are simple only on the surface: forgetting any complications about the 9% extra due for "ephemeral recordings" (i.e. backup or "cached" copies of the same song used to facilitate streaming) or special "confidential" deals negotiated by organisations like National Public Radio, a station that has managed to get 1000 people online to listen to one song (A "performance" in the Copyright Arbitration Royalty Panel terminology) will have to pay 70 cents in copyright fees and a webcaster double that.)

Assuming that the figures from MeasureCast for cumulative audience mean that each person only listened to one song, then the most recent figures for top-ranked station Virgin FM would indicate a payment of around 33 USD for the week but an average song duration of 4 mins and the Total Time Spent Listening of figure of 292,000 would take this to USD3066 for the week, which would come to some USD160, 000 over a year. For America Online its current streaming would saddle it with a bill of around USD2.5 million a year.

Some calculation to do therefore as back payments depend on the audience garnered by a station when it started, the listening pattern of the audience and the station's use of music, even assuming it has kept perfect records. For many, even the estimation suggested (based on aggregate tuning hours multiplied by 15 for webcasters, 12 for terrestrial radio stations except for news,sport, talk etc when there is no multiplier) may pose problems. Which takes us to the information required, something that could be even more of a problem than back payments!

Death through detail

So what information does CARP say should be provided: It looks pretty well like the kind of thing the Recording Industry of America Association might have put together if they really didn't want anyone else streaming.

For the sake of completeness we list the full detail below:

The first set of information, which has to go to the "Primary Copyright holder" (usually the recording company, for each and every song broadcasts is:
A) The name of the service
B) The channel of the program (AM/FM stations use station ID)
C) The type of program (archived/looped/live)
D) Date of transmission
E) Time of transmission
F) Time zone of origination of transmission
G) Numeric designation of the place of the sound recording within the program
H) Duration of transmission (to nearest second)
I) Sound recording title
J) The ISRC code of the recording
K) The release year of the album per copyright notice and in the case of compilation albums, the release year of the album and copyright date of the track
L) Featured recording artist
M) Retail album title
N) The recording label
O) The UPC code of the retail album
P) The catalog number
Q) The copyright owner information
R) The musical genre of the channel or program (station format)

Then there's additional information on the listener:

1) The name of the service or entity
2) The channel or program
3) The date and time that the user logged in (the user's timezone)
4) The date and time that the user logged out (the user's timezone)
5) The time zone where the signal was received (user)
6) Unique user identifier
7) The country in which the user received the transmissions

This, according to the RIAA is reasonable and a practice already followed by many webcasters.

We're not quite sure how, except where listeners have to go through some form of registration enabling a cookie to track their use, end even then it won't necessarily do other than identify the listener who may move from location to location, time zone to time zone.

And quite what they do with a station that may be playing old 45's, in some parts of the world even old 78's, or LP's, we don't know since many of these do not carry all the information.

Remember, of course, all this for a service that is not a profit maker anyway for many, if not most, stations and that many organisations have already called it a day and quit the field.

Reasonable for whom?

Maybe the big automated services could provide most of this information but certainly not many smaller stations which may have been tempted to stream their signal but have not had much return on the investment they put in.

We're also rather concerned about phrases such as "Unique user identification" since we think there's far too much invasion of privacy already and trusting big business not to try and push things as far as it can would not be sensible. Why does the recording industry need to know more than what song was played (so money collected can be paid toe the relevant copyright holder) and to how many people (to quantify it)?

Unless, of course, it's a free way of conducting market research and putting more power into the hands of the recording companies.

What's to be done?

From the view of many a company, the answer to that is likely to be to drop the stream is the proposals are accepted but there'll still be the question of past payments, which may provide a veritable feast for the lawyers but won't benefit broadcasters or webcasters.

We have no problem with the principle of royalty payments but it is a reasonable question to ask if the overall good will be best satisfied by stifling streaming and what good at all will be served by moving money from radio companies to lawyers and recording companies. Far more reasonable to us would be the idea of payments to be comprised of a percentage of a company's profit, combined with a small percentage of revenue of the streamed service.

In the circumstances as they are, however, we rather hope that the National Association of Broadcasters wins its appeal in which it is arguing that the payments made for over the air transmissions should also cover use for streaming.

And we'd quite like some lawmakers with a sense of justice: Maybe just rule that any station that has played any recording that did not carry the details that the RIAA considers "reasonable" and for which such detail is not immediately available from the RIAA should gain immediate exemption from all charges for the past plus a year in future! Would the RIAA consider that reasonable?

Any views? Please comment on the above. For that matter, if you can put the time aside, we'd like your "Guest comment" pages this year to stimulate more feedback and dialogue.

Front Page About this site Freelance bulletin
Site audio files Radio Stations Other links Archives Index Comment Pages Your feedback Browsers
players, 38 Creswick Road, Acton, London W3 9HF, UK: