Senate Judiciary Committee leaders agreed Wednesday that royalty fees
preliminarily set by the Copyright Arbitration Royalty Panel would make it tough
on legitimate Webcasters to provide their services to consumers.
Sens. Patrick Leahy (D-Vt.) committee chairman, and Orrin Hatch (R-Utah),
ranking member, want the industry to negotiate a settlement to fix the situation
or they will consider legislation.
'Why can't everyone -- Congress, artists, labels and Webcasters alike -- take
the CARP as a genuine learning experience and sit down to determine what is the
next best step?' Leahy said. 'If the parties can avoid more expense and time and
reach a negotiated outcome more satisfactory to all participants, that would
surely be preferable to rampant dissatisfaction.'
According to the CARP
decision in February, radio stations would have to pay 0.07 cents per song, per
listener to record companies to stream their signals over the Internet, while
Internet-only radio stations or Webmasters would have to pay 0.14 cents per
song, per listener.
According to Jonathan Potter, executive director of the
Digital Media Association, fees at the level would mean a company such as
classical music Webcaster Beethoven.com
would pay $48,720 in royalties in 2001, while only
Even though Webcasters have the committee's support, they are unlikely to get
any immediate relief from Congress, mainly because the matter is out of
The Librarian of Congress, James Billington, must release a final report on
the rates by Tuesday, May 21. If any of the involved parties -- including
Webcasters, commercial radio broadcasters, public radio stations, record
companies or artists -- are unhappy with the decision, they have two places to
turn: Congress or the courts.
If Congress doesn't like the Library of Congress' final
decision, it could choose to write a law to change the rates. And chances are
high that someone is going to be unhappy and complain to Congress because all
sides have been warring over the CARP's decision since it came out in February.