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March 5, 2007
Bye Bye Web Radio?
Michael Robertson, the outspoken founder of MP3.com, Linspire, and Gizmo, posted the following estimates to a list I'm on. It's the annual copyright licensing fees that leading webcasters have to pay under new rules established by the Copyright Royalty Board:
AOL Music - $20MM for 2006
Live365 -$53.6MM for 2006 (3.6MM in royalties plus $500 times 100K
stations which costs $50MM)
Pandora - $70MM for 2006 (20MM for royalties and lets say they have 100K
stations which costs 50MM - I have created 3 of them for myself over
time. Depending on how you count they could have millions of stations
taking their liability to hundreds of millions - hell even BILLIONS.)
Michael described these numbers (which, by the way, increase 20% or more per year after 2007) as "ludicrous." It's hard to disagree. Until 2005 there was a special exemption for small webcasters, but that appears to be going away. It seems like another case of the music industry shooting itself in the foot.
Posted by Kevin Werbach at March 5, 2007 8:52 PM
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