Music fee hike could bankrupt Internet radio stations

Posted by Humphrey Cheung

Culver City (CA) - Internet radio stations are hopping mad over the Copyright Royalty Board's ruling that music fees should be hiked. The ruling would raise the per song fee that radio stations must pay from .0008 cents in 2006 to .0019 cents in 2010 - this fee is per listener, which for popular stations could really add up. Music stations would also have to pay a minimum of $500 for each web channel of music.

Small companies had previously had the option of giving 12 percent of their revenue to Soundexchange which is the online music clearing house for the RIAA. The new rules effectively charge smaller stations at the same or even greater rate than regular commercial radio stations.

Public radio stations like National Public Radio and KCRW in Santa Monica are fighting the ruling and plan on appealing the decision. KCRW said in a statement, "The CRB decision is truly egregious in that it treats successful non-commercial online music webcasters as if they were commercial stations." NPR says the ruling is unfair because its non-profit stations are being treated like a commercial one adding, "These new rates, at least 20 times more than what stations have paid in the past, treat us as if we were commercial radio.