In the MIX by John Kreicbergs
July 1, 2002

The Death of Internet Radio?

CARP? The RIAA? Royalty rate systems for internet radio?

You probably don’t care or, even worse, don’t know what’s going on.

Well, here's a little eye-opener for you: the future of Internet radio is pretty bleak.

The Clinton Legacy

It starts with this: traditional radio sucks. Apart from NPR and the few remaining independently owned, creatively programmed aural oases out there, the majority of the AM and FM dial is a vast wasteland of cookie cutter, crap content stations. Some of you may not even remember the last time you tuned in to local radio station for something other than a sports broadcast or the morning traffic report. In fact, some of you are probably perplexed by the thought of using that black box in your cars dash for something other playing CDs and tapes.

The question as to why it sucks is pretty easily resolved to a two-word answer: Clear Channel. A corporate conglomerate that owns nearly 1,200 radio stations nationwide in 247 of the US’s 250 largest markets, Clear Channel was the happy beneficiary of the 1996 Telecommunications Act. Signed into law by then-President Clinton, the act all but did away with many of the restrictions surrounding station ownership, including the ownership of multiple stations in single markets. Effectively, the airwaves have been hijacked by this monolithic entity (but not too monolithic, for the sake of any potential antitrust talk) that ruthlessly negotiates their use for the sheer benefit of the music industry’s marketing mavens as well as lining Clear Channels immense pockets.

Sinister, isn’t it? And you thought radio sucked just because the teenyboppers thought boy bands were so dreamy and the guys thought Britney Spears was such a babe.

Nope. Behold the power of targeted marketing. Money talks, kids.

Taking the Show Online

That being said, you probably took your quest online, looking for the next new thing, scouring sites for new artists and anything else to help escape from the top 40 radio wasteland. With the proliferation of CD burning technology and broadband Internet access, music fans were rewarded with a host of new options that excluded the pain of languishing under the Orwellian control of America’s airwaves. Any punk with a garage band, a bare bones recording rig, a CD burner and an Internet-capable computer could effectively short circuit the traditional control of music distribution. And before you knew it, these punks found an audience thanks to the marriage of curious fans with the latest online technology had to offer: Internet radio.

Like the offshore pirate radio stations of the 60s, Internet radio became the voice of the independent artist, allowing enthusiastic fans and aficionados to share their eclectic music tastes with anyone around the world. In the wild, wild west that was the Internet at that time (circa 1996), a working, do-it-yourself alternative was available to the corporate control of traditional radio. Who could have thought that indie could be so powerful...and easy?

Boom Goes Bust

Even as notoriously slow they were to react, the Recording Industry Association of America (RIAA) finally did figure out they were missing the boat. Empowered by the Digital Millennium Copyright Act (DMCA) passed by Congress in 1998, the RIAA, marching to the tune that they were just trying to protect the music copyright rights of labels, and ultimately the artists they represented, began a campaign to figure out how to rein in control over Internet radio. While traditional broadcast mediums have only had to pay composers royalties for the right to broadcast music, the RIAA manage to sway an technologically ignorant Congress that Internet radio instead amounted to digital music distribution, since the files being webcasted were, in fact, "perfect" digital copies and thus entitling artists and their labels to royalties. Meanwhile, anyone who has actually used a computer in the last 5 years knows that as a "lossy" compression format, MP3s, the preferred format for most Internet radio stations, are still not a "perfect" digital copy.

For the sake of space, I’m going forego rehashing the particulars, save for this link that pretty much explains the situation. The royalty system proposed now adopted by the Copyright Arbitration Royalty Panel (as established by the US Copyright Office) is unique to entrant radio alone. Furthermore, as the CARP's decision now stands, the death of Internet radio is imminent, with the first payment of webcasting royalties (retroactive to 1998, mind you) due this November. Nevermind the baffling logic that the RIAA is implementing here: they’re asking webcasters to pay to play (and hence promote) musical artists. Sorry if I’m confused on this one, but shouldn’t it be the other way around?

Save Internet Radio!

Not to paint too bleak a picture, there are only three real courses of action. The first is the hope for a successful appeal to the US District Court of Appeals in Washington, DC against the CARP's decision.

The second scenario would require the RIAA and webcasters sitting down and negotiating a system that would be fair and reasonable to both parties. Considering that the RIAA still feels slighted by the fact that the CARP cut the proposed royalty rate in half (which will still force thousands of online stations to cease their streams), it seems like two parties that have little if no hope of meeting in the middle.

The third involves a close reexamination by Congress of some of the provisions of the 1998 DMCA to revise that particular bit of legislation in light of an increased awareness among members of its inherent flaws. And like any grade-A piece of convoluted American legislation, this one has some whoppers. Here's where we need your help. This is your chance to stick it to the man, old-school style, and it’s going to require not only your attention, but your action as well. Visit www.saveinternetradio.org, educate yourself and GET INVOLVED!

The online radio station you may save could be closer than you think.