Record companies and small Webcasters struck a deal Sunday night on royalty
fees for streaming content on the Web.
Details have yet to emerge, but the deal between the Recording Industry
Association of America and VOW (the Voice of the Webcasters), representing some
15 Webcasters, calls for "significant" discounts below what the Copyright
Arbitration Royalty Panel set for the small Webcasters.
The two-year deal also includes an installment plan for retroactive payments
covering 1998 through today -- some Webcasters had said a lump sum was too big
House Judiciary Committee chairman James Sensenbrenner (R-Wis.) had suspended
a bill on the issue last week in anticipation of the deal. That bill, which
would have either suspended royalty payments until the issue was resolved --
both sides appealed the rates in court -- or codified a new agreement, is
scheduled to be debated Monday. Webcaster royalty payments are slated to begin Oct. 20.
The National Association of Broadcasters, which wasn't a party to the agreement, continues to maintain that broadcasters should not have to pay anything to stream their signals and that Congress, in the digital Millennium Copyright Act (DMCA), meant to exempt not only analog broadcasts from performance royalties but also digital Internet broadcasts. NAB charges that there was a gross misinterpretation of the DMCA by the Librarian of Congress. NAB has appealed the payments. The case is expected to be heard in December in a Philadelphia circuit court. It has also petitioned for a stay of the payments until that case is decided.
In a joint statement, the RIAA and VOW said: "The Recording Industry Association of America and the Voice of the Webcasters announce their support for H.R. 5469, the Small Webcaster Amendments Act of 2002. This Act sets rates and terms for the period of 1998 through 2004 for the use of sound recordings on small commercial Internet Webcasting stations. The act embodies compromises for everyone involved. We appreciate the assistance of congressional leaders in helping move this process along. We look forward to building business partnerships that create the best possible music experience for fans."