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Small webcasters to Senate: "We need SWAA to survive!&

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PostPosted: Fri Oct 11, 2002 2:05 am   Post subject: Small webcasters to Senate: "We need SWAA to survive!& Reply with quote

MESSAGE TO THE SENATE - Small Webcasters Amendments Act of 2002

Dear Senator:

Voice of Webcasters, a coalition of independent commercial webcasters, urges the Senate to approve the Small Webcasters Amendments Act of 2002, recently passed by the House of Representatives as HR 5469. The passage of this bill BEFORE OCTOBER 20 is essential to the survival of the independent webcasting industry.

In this era of media consolidation, the Internet has provided a medium for expression and creativity for a number of new Internet broadcasters who cannot afford to enter the traditional terrestrial broadcast industry. The royalties recently adopted by the Library of Congress puts the new Internet broadcast industry in peril. The royalty rates for the performance of sound recordings by non-subscription webcasters were based on a per-performance formula. This formula has the unfortunate effect of requiring these webcasters to pay high fees for their use of music, even before their audience has grown to a sufficient size to attract any appreciable advertising revenues. Without the percentage of revenue option provided by the Bill, the webcasting industry would be closed to all but those with the substantial resources necessary to subsidize the business until the advertising revenue caught up to the per-performance royalty rate.

What is worse for many of the pioneers of this industry is that the royalties are retroactive to 1998 and must be paid by October 20 of this year. Many of these webcasters have been broadcasting for years, resulting in tens of thousands of dollars in royalties under the Librarian's rates, but are just now approaching audience sizes where they can attract substantial advertising revenues. If the bill is not passed by October 20, the crushing burden of these retroactive liabilities will put many of these small webcasters out of business. THE SENATE MUST ACT BEFORE OCTOBER 20 TO AVOID KILLING THIS NEW INDUSTRY BEFORE IT HAS TIME TO DEVELOP.

The bill accomplishes the following for small webcasters:

- Establishes percentage-of-revenue based rates for the royalties to be paid by small commercial webcasters for their public performance of sound recordings;
- Allows Noncommercial entities that are not FCC licensees to pay sound recording royalties at the rate established by the Library of Congress for noncommercial FCC licensees;
- Provides that the royalties due from small commercial webcasters and noncommercial entities can be paid over time;
- Establishes requirements for recordkeeping for sound recording performances by small commercial webcasters.

Many of the small webcasters are independent entities run as small businesses by individuals. The Bill provides a percentage of revenue option for small businesses with less than $500,000 in gross revenue in 2003 and $1.25 million in 2004. The bill also provides for minimum fees and a percentage of expenses floor on the royalties, to assure that copyright owners and artists receive some payment for the performance of their music.

For noncommercial entities, the Bill corrects an anomaly in the Librarian of Congress' decision. Under that decision, nonprofit entities that held FCC licenses were given a lower per-performance rate than were commercial entities. However, the decision made no such provision for noncommercial entities that were not FCC licensees. The bill extends the lower rate to all nonprofit entities.

The undersigned small commercial webcasters need your support, and we need it TODAY. Please help us keep this new medium of expression from being destroyed by the Librarian's royalty rates! Please pass Small Webcasters Amendments Act of 2002, HR 5469, before October 20!

3WK L.L.C.
Jim and Wanda Atkinson, Owners,
St. Louis, Missouri

Boomer Radio
Ron Rubin, President and CEO
Boalsburg, Pennsylvania

Classical Music Detroit, L.L.C
Robert F. Ottaway, Founder
Detroit, Michigan

Carol Hess
Chatmasters Streaming Network
Lewisville, TX

Freshwater Radio
Michael Anderson
Great Falls, MT 59404

Frank Coon, Owner
Stone Mountain, Georgia

Bill Goldsmith, Online Operations Manager
Santa Cruz County, California

Montpelier Communications L.L.C.
Onion River Radio
Frank R. Schliemann/Founder
Montpelier, Vermont

Radioio Mike Roe, Owner
Jacksonville, Florida

Bill Goldsmith, Owner
Butte County, California, Inc.
Michael Donahue
Sudbury, Massachusetts

Rusty Hodge
San Francisco, CA 94110
James Jennison, Technical Support Administrator
New York, NY 10003

Ultimate 80s
Dave Landis, Founder
Los Angeles, California

WebMedia Consulting, Inc. (Digitally Imported Radio)
G. Ari Shohat, President
Staten Island, New York

Wolf FM
Steve Wolf, Owner
Nashville, Tennessee

VOW was formed as a coalition of webcasters to promote the diversity and quality of Internet Radio, and to educate the public on Internet Radio issues. To find out more, visit

“Without music, life would be a mistake.”
― Friedrich Nietzsche, Twilight of the Idols
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