Beleaguered Internet music service Napster wants Congress to grant it a blanket license that would allow it to offer music to consumers by just paying one fee into a pool that would then be distributed to record companies, publishers and artists, Napster CEO Hank Barry told a Senate panel at a hearing on Tuesday.
Sen. Orrin Hatch (R-Utah) called the granting of a so-called "compulsory license" a "last resort," and said he would only consider the move if the industries involved could not work out their differences.
Representatives of copyright industries-MPAA's Jack Valenti and RIAA's Hilary Rosen-are 100% opposed to any compulsory licensing scheme for music or movies. "The reason a compulsory license won't work with movies," Valenti said, "is because cable and satellite are defined by limited areas. But the Internet is global and instant. The technology to contain it doesn't work."
Valenti also said the Web's global nature would enable exorbitant royalty fees. "Amercians would be subsidizing the viewers in other countries around the world," he said. "The idea of a compulsory license is an idea whose time should not come."
"There has never been a compulsory license that goes to the core distribution right," said RIAA's Rosen. "That would be a disaster."
The Ninth Circuit Court of Appeals in San Francisco has told Napster to take any copyright-infringing songs off its file-sharing service, although the take-downs are apparently slow-going, according to the recording industry. In light of that decision, Napster is looking for some legislative relief because cutting individual licensing deals with record companies that covers all songs is nearly impossible and very expensive.
Meanwhile, singer/songwriter Don Henley and singer Alanis Morrissette came to Capitol Hill to defend artists' rights. Henley said artists should be recompensated every time one of their works is played on streaming Internet radio. "It is fundamentally unfair that broadcasters have always been exempt from paying performers a performance right for analog broadcasting; we don't want to see this inequity extended to the Internet."
Broadcasters currently are challenging a ruling by the U.S. Copyright Office last December that requires them to pay royalties to record companies, a royalty they don't have to pay to broadcast over the radio. "There are a number of examples of stations who, as a result of the Copyright Office's decision, have shut down their Internet streaming operations," says Dennis Wharton, NAB spokesman. - Paige Albiniak