Tim Westergren, founder of Pandora and the Music Genome Project, has been talking up Internet radio and what the Copyright Royalty Board’s March 2nd decision means to Internet radio webcasters, his company, and its legions of fans.

From the Pandora blog:

Internet radio is hostage to a blatantly discriminatory double standard that was written into the federal statute governing webcasting several years ago, following an intensive lobbying effort by the RIAA. We need to redress this, and create a more level playing field - one that of course rewards musicians for their work (I spent years in a band van myself and have always been driven by a desire to lift up musicians), and one that also understands the business realities, and benefits of online radio.

Recently Tim sat down for an informative web interview with the guys over at the Download Squad:

Tim’s interview earlier this month with college Internet radio station KCSCradio.com’s Felix Thursday is here:

KSCSradio.com wants everyone to download and distribute the Tim Westergren interview.

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ThereIsNoRadio.com has to choose between fewer listeners and surviving or more listeners and shutting down.

It’s Good To Be The King, or at least so in the world of the RIAA, where their arms-length entity SoundExchange can cajole a three person panel to remain within a strict interpretation of their mandate and dictate that only one parties requested terms will be the acceptable terms for the buyer/seller relationship. The CRB’s ill-considered position will effectively close down an entire category of mutually-beneficial business - and this is serving the artists and the enthusiastic listeners who buy their CDs and go to their concerts (and US-based Internet radio stations) how exactly?

ThereIsNoRadio Now Listed on iTunes Radio

I received an email from iTunes today that would have had me dancing around the room six months ago, but today gives me a very different reaction. Today I was notified that my internet radio station, ThereIsNoRadio.com, has been added to the iTunes radio station directory and my reaction is a lot more fear than joy. This will increase listenership to the station dramatically over the coming weeks. What’s wrong with people listening to the station you ask? Isn’t that the goal of a radio station? Well, yes it is, but with the new royalty rates looming over the heads of mine and all other internet radio stations; new listeners, at the rate they will come through iTunes, could very well mean the death of the station.

With only 100 streams filled 24 hours per day and 7 days per week and averaging about 16 songs per hour, we are looking at paying royalty rates of $42 per day, $295 per week, $1,182 per month and $15,375 per year. We have well over 100 streams to fill so our royalty costs could easily more than double. We have never attempted to make money with the station. One of our goals has been to make enough money to continue to break even as we gain listeners and add slots. Currently I spend out of pocket about $250 per month between costs to stream, website hosting, and royalty payments. We make about $20 per month for ads and have never come close to breaking even. My day job currently funds almost all of the station expenses.

Our station is different from lots of internet stations in that our primary objective is talk radio. Our talk shows run in the evenings and the guys running these shows do it for a love of radio. They do not get paid for their efforts, but they are the reason most people tune into the station. We do play music throughout the day and late nights to fill time between talk shows. Because we don’t run commercials, the talk show hosts run music when they take breaks to rest their voices.

The cost of playing RIAA bands has now gone out of the range of what we can afford and we will be concentrating our future efforts on independent bands. It is interesting that the laws of the United States seem only to be obeyed when it benefits the record companies. The record companies who have been illegally paying FM radio stations to play their music for the promotional value of radio are now requiring internet radio to pay them for the same promotional value.

We could switch formats to 100% talk radio with no music, but for some reason, we would still have to pay music royalties because we are an internet radio station. The real talents aired on the station, the talk show hosts, will continue to go unpaid.

We have banded together with other internet radio station owners at www.WebcastersUnite.net and www.SaveNetRadio.org to fight these unreasonable royalty rates. Make no mistake, we are not asking for a free ride. We understand and accept that royalties are part of the cost of doing business. Artists should be paid for their work at a fair market price. The current market price is out of our range, so ThereIsNoRadio and many other internet radio stations will soon be going to another vendor (the independent artists ) for a similar product at a better price.

The addition of our station to the iTunes directory has been a goal of ours for awhile and I am both happy and proud that we have achieved it. It is unfortunate that to keep our station on the air, we may now have to have that listing removed to keep both our listenership and costs down.

Badmonkey

Any business operator will tell you that to remain competitive, or in this case, remain in business, one has to find ways to ensure your costs remain at an level acceptable to your owners and investors, even if you operate at a loss for a period of time - just ask Sirius or XM Radio.

And when your costs exceed what you are willing to endure, or the demand for your product isn’t matching expectations, you either find ways to reduce costs, or you shut down (see also Iridium, Excite@Home and an infinite number of tech startups).

Getting added to the iTunes radio directory is a pretty big deal, so ThereIsNoRadio.com doesn’t seem to have a problem with developing a demand for its product. With costs projected to outstrip the benefits of what will surely be a sudden rise in demand, it looks like Badmonkey must turn away from all that new business unless he can find a way to give the RIAA, a minor supplier of content, the boot.

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When I was in high school in the mid-90s, ‘alternative’ music dominated the popular music world and I was an avid consumer of it. Then when I went to college, the landscape changed and one by one the radio stations that fed me changed formats and left me in a musical limbo in northwest Missouri. At one time I was buying one or two CDs a month, going to at least two or three concerts a year; for several years this dropped to one or two CDs a YEAR (only new releases from longtime favorites like REM or Weezer, never anything from new artists) and no concerts, even though I was in college.

Then I graduated and got my first ‘real’ job with a desk and computer to sit behind all day. I wanted to help pass the time by listening to music, but my music collection was severely anemic, so I went online to explore the new world of streaming Internet radio. Almost immediately I discovered Radio Paradise and I have been an avid listener every day at work (and at home when I can manage it) for over 4 years now. I discovered that my passion for music had not died, it has just atrophied in an environment where I was not exposed to anything new and interesting. And as soon as I was hooked, I started spending money again.

I discovered new favorite artists like Neko Case, Spoon, the Shins and so on, and have bought several CDs from these groups I never would have otherwise. I bought an iPod and began buying downloads left and right of the new favorite songs I was hearing. I rediscovered bands that I liked in high school and gained a new appreciation for them. I went to the occasional concert again (saw Cake twice after rediscovering them on Radio Paradise). I even started buying OLD music from artists I knew but never appreciated enough like Bob Dylan and the Rolling Stones (after hearing their music that has NOT been worn out by repeated play on classic rock FM radio).

I have to say that I can credit NOTHING more than Radio Paradise for rekindling my passion for music and by extension my willingness to lay down money to listen to the music that I love.

~Bart German

Trimble, Missouri

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Three weeks in now and we finally get a bit of good news.

Story via CNET and FMQB

After petitions and pressure from NPR and other broadcasting organizations, the Copyright Royalty Board (CRB) has agreed to hold a rehearing over the controversial, proposed new Internet radio royalty rates. The decision was formally made late Tuesday and the CRB cited a number of petitions from NPR, DiMA, Sound Exchange and many others.

No date has been set yet for the rehearing, but in the official order, Chief Copyright Royalty Judge James Scott Sledge wrote that the “Copyright Royalty Judges desire to hear the positions of each party on each of the issues raised in these motions.” Responses to the motions may be filed no later than April 2, which is also the date that written arguments may be filed on the issues raised by the motions.

Of course these are the same judges agreeing to a rehearing who also accepted pretty much everything SoundExchange had to say while ignoring the detailed submissions of Internet radio webcasters when they handed down their decision on rates back on March 1st.

After months of examining the issues and hearing submissions from representatives of Internet radio and SoundExchange, will they now suddenly find cause to change their opinions? I wonder.

UPDATE & CORRECTION

Via Radio and Records.com

Correction: Copyright Royalty Judges Only To Consider Rate Outcry

By Jeffrey Yorke

Attorney David D. Oxenford, a partner in the D.C. law firm of Davis Wright Tremaine LLP, spent some time Wednesday morning telling clients, “Whoa, hold on, it’s not time to celebrate yet,” after they read here that the Copyright Royalty Judges had agreed to a rehearing on royalty rates. The judges did not agree to a rehearing. What the judges did on Tuesday was, after hearing a loud outcry from the industry and public over the new, dramatically higher internet music streaming rates, invite additional written comment on the issue. They make no promise to act on comments or to hold additional hearings or take a new position on the rates they set for 2006 to 2010. The judges ordered that all responses must be submitted to them no later than April 2.

Emphasis mine.

There goes that smile you may have had after reading the initial news.

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Hi,

I am a Canadian bluegrass singer/songwriter who released a debut album last May, titled Ties that Bind. I owe a tremendous amount of gratitude to Internet radio DJ’s who welcomed my songs with open arms and have given my album a lot of exposure. As a result of this I have been blessed with interest in my music from many parts of the world… something that I never dreamed of when I decided to record my songs.

I made a CD for the love of the music and to share that with other people. A little royalty cheque here and there, to me, is an added bonus. I certainly believe that credit has to be given to the creators of music and that includes paying royalty fees, but I would hate to see Internet stations close down because of it. The stations that play my music bring bluegrass to fans that would not hear the music anyplace else if they had to rely on their local commercial stations to play it.

Sincerely,

Heather Ferris

www.heatherferris.com

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Hello,

I listen quite often to Indie Pop Rocks off of SomaFm.com. If I didn’t have this great way of learning about good new music, I am positive my monthly CD purchases would decrease. I can point to at least thirty CDs that I purchased solely because I first heard their music on Indie Pop Rocks. If I only listened to ClearChannel-type homogenized terrestrial radio, I would absolutely never have heard of–let alone purchased the recording of–bands such as the Aislers Set, Loquat, Victory at Sea, Say Hi To Your Mom, Rainer Maria, Duke Spirit, Midnight Movies, The Wrens, Stars, Islands and The Unicorns.

I appreciate what you are doing to help Internet radio survive. For my part, I have already written my congressional representatives using the links from your site and signed an Internet petition that currently has over 14,000 signatures. I hope that I have helped and that your efforts will not be in vain.

Sean Jordan

University of San Francisco

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I am a big fan of Indie Pop Rocks on SomaFM. It gets me through every single day at my office. The best part is that the name of the song and band scroll across my iTunes window. Anytime I hear something I like, I write it down. Music that I have bought because I heard it on this Internet radio station makes up about 80% of the new music I have bought in the last year. The remaining 20% is music that I have bought after watching the band live. Indie Pop Rocks is the ONLY station I can listen to at work. Perfect mix of everything at the right pace to keep me going without distracting me. And there are no commercials which is ideal!

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Kate McGuire

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Living on the East Coast, Myrtle Beach, SC, does not provide the opportunity to listen to the music of my youth – Hawaiian music. No one will be able to understand the fulfillment I received upon finding this little Internet radio in Hawaii that brought me back to the Islands, be it only through my imagination.

The joy of listening to the sounds of the Islands brings back the memories of Hawaii Calls, as I have lived far away for most of my adult life. Being able to listen to Hawaiian music in the twilight of my life brings me more pleasures than can be expressed in words.

The notion that the government is going to take this pleasure away by increasing the royalty fees to such an extent that most of these Internet radio stations will have to stop providing this service is just another example of the big and powerful controlling what we the ordinary people enjoy.

Please, everyone, write your congressmen and senators! There are very few joys left in life and for me listening to Hawaiian music from Hawaii as I relax in Myrtle Beach, SC is what I so dearly desire.

Pete Provencher

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My life has actually changed in many ways just because of my exposure to my most favorite Internet station, Internet Radio Hawaii. Six years ago, when I got broadband, I found IRH. Forty years ago my mother used to play Hawaiian music, but I had no idea what was going on with this genre since, until I discovered IRH. As I listened to IRH, I listed the songs, album names, and the artists’ names of hundreds of sounds I heard, and have purchased about 50 of these CDs since.

I have attended at least 15 or more concerts by some of these artists in the Boston area, New York City, in California, and in Hawaii. I have made at least four trips to Hawaii, especially, to see some of these shows. Without IRH.com I would never have known about any of these artists.

Several of the more famous and popular Hawaiian music artists also got involved with my volunteer work at WGBH, the Boston public television station. In the past six years at least $10,000 worth of CDs from some of the Hawaiian artists have been donated to the WGBH Annual Auction. These CD’s have been auctioned off on the air and have raised more than their value for WGBH. Because of my enthusiasm for Hawaiian music, at least 15 of my friends, too, have come with me to various concerts by some of these musicians. My friends have traveled to NYC and all the way to Maui for these shows, and in April, a dozen of us will go to a concert in the Boston area. Mind you, none of my friends would have even heard of any of these artists if not for the trickle effect, stemming from IRH. Many of my friends have also started their own collection of Hawaiian CDs.

Betty Dew

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We are still seeking stories from Internet radio listeners about the impact that your favorite stations have had on your life, and what a loss it would be for you personally if those stations were no longer available. Please submit stories and photos to mystory@saveourinternetradio.com

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I used to just listen at first. Then I lurked around the boards for awhile. Once I saw how friendly everyone was, I began to post and haven’t been able to stay away since.

This seems to be the common story of just about every listener on the message boards of Radio Paradise, an Internet radio station in Paradise, California.

According to old timers, Radio Paradise has come a long way since its initial site, with only 200 listeners who often congregated on the single message board called Comments.

Over the years, its unique collection of eclectic music (a blend of classical, jazz, funk, soul, folk/acoustic, classic rock, modern rock, alternative rock, alt-country, world and tunes that simply cannot be defined by any music store genre) has brought together several hundred like-minded people. People who listen to this wide variety of music as they work in their offices or at home. People who make conscious choices to enrich their musical world with non-mainstream artists and music. People who bring their individual minds to discussions about world events, religion, music, film, and other topics.

There are some listeners who also love hanging out on the boards and simply visiting with one another. In many ways, the message boards of Radio Paradise are like a playground for grown-ups to greet one another, discuss what’s going on in their respective regions, families, and personal lives. Yes, there is sometimes conflict between them and a few ruffled feathers, but at the same time there is a lot of compassion, love, and laughter. This is what brings these cyber-friends together on a daily basis, from all corners of the country and world.

In the summer of 2005, a Pasadena listener decided to open up his annual summer party (known as Reinstock) to all his cyber-friends from Radio Paradise. As the Reinstock invitational poster proclaimed in purple print: They come from all over. Indeed they did. Guests flew in from the East Coast, the Gulf Coast, the Midwest, the Plains, the Southwest, the Pacific Northwest and other parts of California. Although there had been other Radio Paradise meet-ups in the past, this was perhaps the largest gathering of all.

When cyber-friends come together for the first time, the most amazing thing is seeing one another animated. Previously, each person was only words on a screen or, if they felt open enough, an occasional posted photo. Some knew one another’s voice from phone calls. So there were ample smiles and hugs as the radio listeners finally met in person. They ate, drank, laughed, sweated, and sung together until the wee hours of the morning. Everyone left the next day with a warm glow in their hearts, their lives a little more enriched.

The Radio Paradise gathering at Reinstock was clearly an example of how Internet Radio not only provides great music, but how it unites the world.

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Dear fellow Internet radio fans:

I discovered Internet radio shortly after Apple introduced iTunes and I began browsing the various genres available. I was amazed at how much variety was out there and at the high quality of most of the sites. Although my very eclectic musical tastes took me everywhere from opera to Celtic to Hawaiian to Persian, I soon settled on Radio Paradise as my top choice based on the extremely high quality of the station in all respects, but mostly because Bill Goldsmith’s widely ranging tastes and playlist so closely matched my own.

Like many in my generation (I’m now 46) I had been an avid FM radio listener in the seventies and eighties, but had pretty much lost track of the contemporary music scene as FM radio settled into either classic rock or the current pop or rap. I already had all of the old Doors and Beatles albums I could use and Britney Spears, Boyz 2 Men and Puff Daddy really left me cold. For about ten years I didn’t really buy any new rock albums except for the occasional new release from the likes of Joe Jackson or Suzanne Vega.

But then Radio Paradise opened my ears to what was really new and good in music and I realized that rock music had continued
progressing, but that FM radio (and hence me) had just missed it. I was turned on to new and exciting artists such as Vienna Teng and Josh Ritter and other more established artists who just hadn’t made much mainstream airplay like Greg Brown or Beth Orton. I also really listened for the first time to music from people like Beck or the White Stripes who I had certainly heard of but never really appreciated. And Radio Paradise even reintroduced me to classics like Neil Young or Leonard Cohen and gave me my first listen to people like Norah Jones or Lily Allen.

Since finding Radio Paradise I have purchased at least a hundred “singles” from iTunes (just like the old days of 45’s) and
dozens of CDs from artists like those mentioned above plus Tori Amos, Madeleine Peyroux, Bruce Cockburn, etc. With small children in the house I don’t go to too many concerts, but in a couple of weeks I’ll be hearing Vienna Teng in concert for the first time.

I still love to “flip through the dial” at Live365 and I do listen to FM radio at home and in the car — but really only to NPR,
classical music or the local traffic reports. My main radio station is certainly Radio Paradise and I am looking for the right stereo
component to allow me to play it and other Internet radio through my home stereo system instead of just on the computer. If American Internet radio were to disappear (and let’s do everything we can to help make sure it doesn’t!), I still would never go back to overly commercialized broadcast radio. I would probably end up finding stations in Europe or Canada or just falling back on my CD and LP collection like I did in the 90’s. Neither of which would do much to support the US music industry.

And finally my own rant on the RIAA and CRB situation. It is extremely short sighted as well as greedy of the RIAA to try this
reprehensible tactic. If they succeed then not only will they lose their existing revenue stream as domestic Internet radio stations
shut down, but they will lose out on the money that Internet radio fans spend on buying music. They worry that people will just
download the music streaming across their computers instead of paying for it, but that has to be a very small leak and certainly making the stations pay for listeners’ cheapness and disregard of copyright law is not the way to rectify the situation.

Hans Krimm
Silver Spring, MD

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My name is Nukey Pearce, and I am representing the staff, supporters and listeners of Chronix Radio LLC. While I am not directly financially involved in the project, or running it, I would just like to explain how the death of Internet radio will be the biggest end to a technological era.

First of all I would just like to explain who I am representing. Chronix Radio runs an online streaming service split into three individual, unique channels. The service has currently been running over 5 years now, and each day tops a thousand listeners at any one given time. While this may seem low, the fact that the entire service is completely reliant on user-given donations really shows the true spectrum and meaning to the listeners of this service.

I must be the first to admit that I can not have any direct intervening within the process of rescuing what we love and put our hearts into most. Living in the UK, I can merely tell the story and support those in the areas where it means most to them. This is a good on-the-fence perspective as to who really is involved; showing that even the most obscure of operations really can make worldwide coverage, not only within the radio service in general, but music exposure, too.

As many people are aware there are petitions going around the Internet, asking for your support. The main petition shown at ipetitions.com is vital to help restore and keep the services we all love. What most people don’t realise is that the majority of these services started out from nothing: there are no big corporations involved nor governing bodies. For the majority of the services, there is simply just one, two or three people who are behind the whole thing.

Many of the operators have placed their entire livelihood into what we take advantage of today, and the fact that the Recording Industry Association of America and the DMCA are taking this away, we need to act now.

The music industry has never been as lively and profitable as it has now. Ever since the 1960s the music industry has grown and grown into what moulds into our lives today; the sheer fact that the top bodies within the RIAA and the like are asking for more money unneedingly is very unfair, not just to the operators, but to the supporters, listeners and to an extent the artists ourselves.

At Chronix we all pride ourselves on steering away from the mainstream. We all have our own tastes, likings and preferences, but deep down what we like can’t be dictated by anyone, and we feel this is what is happening. With the loss of Internet radio, we will end up with expensive, commercialised reality-TV based artists only dealing in one genre. Although this may be ideal for some, especially the more younger generation, this doesn’t appeal to everyone. The cost of music itself has also steadily risen over the past years, especially where CDs are concerned. £15 for a compact disc can be seen as quite expensive, but with online radio not only will this give more exposure to the artists (therefore increasing the revenue of the recording companies), but will also bring down the cost in CDs through demand, so it will be an all-win situation.

Internet radio has been going for many years now and up until now the royalties that are payable have been fair and square. There is only one person behind all of this who gave the go-ahead of the rising of the costs, and although I may not know who that is the decision is very unfair for everyone.

Just think of all the people who will lose their livelihoods. Communities will fall apart, friends will split and the overall interest in music will been lost. Please ask yourself one question: Do you like music? If the answer is yes then you need to act now.

From everyone at Chronix Radio we wish all of the operators and supporters the very best, and hope we can all conquer this glitch. We all need to stick together, and with your support, such as the petitions and community groups, you can really make a difference.

We wish you all the very best.

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