Broadcasters Trying To Kill Web Bill?
*** Developing Story *** Updated Saturday @ 8:35 pm ET
The National Association of Broadcasters is reportedly trying to kill a bill introduced by Rep. Jay Inslee, D-Wash., that supporters say would allow months of royalty negotiations between music and Internet industries to continue. The bill, which is scheduled to be taken up in the House shortly, authorizes digital royalty collector SoundExchange, on behalf of copyright owners and performers, to negotiate an alternative royalty agreement before the end of the year with any Internet radio service.
A source close to the issue told Tech Daily Dose that lobbyists for AM and FM radio are worried about competition from webcasters and extinguishing the bill would throw a wrench into the royalty talks. "If they kill this, that means they're able to kill the negotiations," the source said. The bill does not affect the scope of performance rights or underlying copyright law and does not impact broadcasters, SaveNetRadio said in a statement. The bill only clears the path for private negotiations to continue while Congress is in recess, the grassroots advocacy group said.
Click the jump for more updates as the story develops…
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"[NAB] is calling members and they're hitting the Energy and Commerce Committee hard," Pandora founder Tim Westergren told Tech Daily Dose on Friday afternoon. He characterized the alleged lobbying blitz as a "full court press" and if broadcasters are successful, "the clock will run out on Web radio." Westergren said the alleged activity is "outrageous" and said NAB is "interfering in our business." "They're trying to cross over industry and kill a competitor."
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NAB spokesman Dennis Wharton said any lobbying activity "has nothing to do with NAB not wanting to compete with Pandora and Live365. We compete with them every day." He went on to say that his trade group has "concerns related to Congress attempting to fast-track a bill introduced less than 24 hours ago that could have serious implications for broadcasters, webcasters, and consumers of music." "NAB spent more than a year trying to work out an equitable agreement on webcasting rates, only to be stonewalled by SoundExchange and the record labels. We will continue to work with policymakers on a solution that is fair to all parties," he said.
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The Digital Media Association, National Public Radio, the Recording Industry Association of America and SoundExchange issued a joint statement saying their talks have progressed in recent weeks but because Web radio royalties operate under a government license, Congress must allow any negotiated settlement to take effect. The bill has bipartisan support and was co-sponsored by Judiciary Courts, the Internet and Intellectual Property Subcommittee Chairman Howard Berman, D-Calif.; Judiciary ranking member Lamar Smith; Judiciary Chairman John Conyers; and Rep. Donald Manzullo, R-Ill., they pointed out.
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A House aide with knowledge of the developments said NAB is "trying to find a way to stop this bill that they in theory have supported" because they are concerned about what finalizing the music-tech industry negotiations will mean for them in the bigger picture performance rights battle. The staffer predicted the broadcasters' lobbying effort will be more prominent in the Senate where a single member can block a bill from being considered by unanimous consent. If royalty talks conclude but Congress adjourns without passing the Inslee measure, the settlement "would mean nothing." "The bill puts into place a legal framework to let the deal go through," the aide said.
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Sen. Rob Wyden, D-Ore., has no immediate plans to offer a companion bill to Inslee's, a spokeswoman said Friday. Wyden staffers, however, are working closely with webcasters to ensure that the House bil passes. If that happens, the Senate could take up the House version. Earlier this session, Wyden and Sen. Sam Brownback, R-Kan., introduced a bill they argued would "save Internet radio from a recent royalty hike that threatens to bankrupt the industry." Inslee introduced a similar bill in the House.
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Blast from the past… In July 2007, NAB announced its "unequivocal support" for Inslee's earlier webcaster bill. The trade group backed the bill and accused SoundExchange of not responding to a "good-faith, reasonable" offer made by member stations to set royalty rates. Inslee's previous bill would have charged Web radio services a percentage of royalties rather than a per-song-per-listener fee.
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AccuRadio.com founder Kurt Hansen called the NAB lobbying blitz "ludicrous." On his blog, Hansen wrote that the activity "totally violates the spirit of what NAB CEO David Rehr said last week at the NAB Radio Show -- e.g., 'NAB has been working to address the outrageous Copyright Royalty Board decision that dramatically increases streaming rates.'" "Trying to block this bill is a slap in the [face] to all NAB members who believe that streaming is an important part of radio’s future," he wrote.
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Inslee sent a "Dear Colleague" letter Saturday urging support for his webcaster bill and providing details for what the measure does and does not do. "This is a bi-partisan technical bill, supported by both the chairman and ranking member of the Judiciary Committee," he wrote. "This bill does not affect the scope of performance rights or any underlying copyright law, and it does not impact broadcasters." Inslee wrote that webcasters "desperately need this legislation so they have the freedom to enter into negotiations to pay lower rates now." "Without this authority, they will continue to be forced to pay higher rates," he said.
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