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College Radio Gets Break from Copyright Royalty Board on Webcasting Rates and Reporting

College Broadcasters, Inc. (CBI) is reporting that they’ve achieved an important milestone after their settlement with SoundExchange on copyright royalty fees for music played by educational radio webcasters was preliminarily adopted by the Copyright Royalty Board (CRB). CRB’s “Initial Determination of Rates and Terms” (PDF) was released on December 14 and outlines the payment terms for various types of webcasters. According to CBI (PDF),

“The rates and terms of the settlement for educational stations maintain the current $500 minimum annual fee, below a threshold listening level, not available to non‐student stations, providing these stations a large degree of rate certainty for the next five years.”

Another important provision in this agreement is an option for college radio stations with small audiences to pay a proxy fee of $100 in place of submitting “reports of use of sound recordings” to SoundExchange. CBI states that,

“Under the agreement, the student stations with the smallest audiences are eligible to pay a proxy fee in lieu of collecting, organizing and reporting to SoundExchange a large amount of data that these stations might have trouble producing.”

Although CBI has expressed satisfaction with these fees, included in the proceedings were dissenting opinions from another college radio advocacy organization, Intercollegiate Broadcasting System (IBS). IBS claims that even the $500 minimum annual fee would be difficult for some of its member stations to afford and they argue that a rate structure should be in place to acknowledge the situations of college radio stations with tiny audiences. Those arguments were rejected by the CRB and the rates established in the CBI/SoundExchange proposal were adopted for the period 2011-2015.

Webcasting rates have been a source of great debate (as evidenced by Internet Radio’s Day of Silence, trend #7 in our “Decade’s Most Important Radio Trends” series last year) and it’s nice to see that the CRB has acknowledged that small college radio stations should not have to face the same reporting and cost burdens as their commercial radio counterparts.


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6 Responses to College Radio Gets Break from Copyright Royalty Board on Webcasting Rates and Reporting

  1. Nick December 22, 2010 at 5:06 am #

    Wow, this is…good news? I have to admit that anytime I see a policy favored by SoundExchange, my instinct is to look for the dark cloud amidst the silver lining. For instance, I see this: “not available to non‐student stations…” and my first thoughts are, how are they going to define “non-student station”? A station with a few paid staff members who aren’t students? A station with a percentage of DJs who aren’t students? If so, those stations are shut out.

    I see this: “below a threshold listening level,” and I think, here we go again, this is like letting a plant stay in the sunshine until it starts to get big, and then it goes into the basement. And what’s the threshold?

    Finally, there’s “…providing these stations a large degree of rate certainty for the next five years.” Does the agreement address the post-2015 future at all? Is a rate hike explicitly or implicitly invoked?

    The easing of reporting duties seems an unalloyed victory – huzzah! And putting a positive spin on my above suspicions, let’s just say I’m wondering just how much to love this agreement. But I am wondering. What say ye, Radio Survivor/readers?

  2. Jennifer Waits December 22, 2010 at 11:43 am #

    Nick, I agree that it’s hard to say if this is really a clear victory, especially given the concerns expressed by IBS (by the way, IBS submitted the only dissenting comment to the CRB, whereas 24 stations expressed agreement with the SoundExchange/CBI proposal) about the rate structure for noncommercial educational webcasters. IBS would prefer that noncommercial educational broadcasters with small audiences should have rates that start well below the $500 minimum annual fee.

    Reading through the 137 page document prepared by the Copyright Royalty Board (non-commercial broadcasters are addressed starting on page 50), it’s difficult to ascertain how these rates will affect specific college radio stations. There will be additional fees above the $500 minimum if the monthly ATH (aggregate tuning hours) is more than 159,140 (an average of 208 concurrent users in any month according to CBI’s estimation). So, those college radio stations with audiences in that range need to take a careful look at how fees net out after that threshold is reached.

    A big question in my mind is how will the webcasting landscape change between now and 2015. I would imagine that the number of online listeners to college radio stations will increase, especially if stations continue to lose their terrestrial signals.

    Although I can’t find a definition in the latest document, in past agreements, “noncommercial educational webcasters,” had to be stations affiliated with an academic institution and need to be staffed largely by students.

  3. Matthew Lasar December 22, 2010 at 6:16 pm #

    My own inclination is that the Federal government should completely exempt public, college, and community radio stations from having to pay any copyright or performance royalties, a “public media” exemption, if you will. This would amount to a terrific means of supporting these very needed venues.

  4. Will Robedee January 3, 2011 at 9:42 pm #

    Nick,

    Let me address some of your concerns.

    “I have to admit that anytime I see a policy favored by SoundExchange, my instinct is to look for the dark cloud amidst the silver lining.”

    SX favored this because they agreed to it through difficult negotiations with CBI. Both sides gave up somethings to reach the agreement.

    The dark cloud you are looking for is that the rates above the 159,140 ATH (average of 208 listeners) cap went up. There is a very small minority of college stations that exceed this cap. IBS only requested rates and recordkeeping reductions for those with MUCH a much smaller ATH.

    “IBS urges us to recognize and set rates for two types of services: small noncommercial webcasters, defined as those whose ATH does not exceed 15,914 per month, and very small noncommercial webcasters, defined as those whose ATH does not exceed 6,365 per month.” See page 51 of the determination.

    While CBI agrees that the rate should be lower for ALL student stations, it was our legal opinion that we could not win such an argument. IBS tried and lost here and in the remand proceeding from Web II (1996-2010 rates) that was ordered by the appellate court.

    For those very few student stations that exceed the ATH cap, there is an alternative, the non-commercial settlement that came from the Webcaster Settlement Act of 2009. The rates are A LOT lower, but there are no recordkeeping/reporting concessions in that settlement for stations that exceed the ATH cap. So that handful or two of stations that exceed the cap have a choice, pay more or report more.

    “Finally, there’s “…providing these stations a large degree of rate certainty for the next five years.” Does the agreement address the post-2015 future at all? Is a rate hike explicitly or implicitly invoked?”

    The CRB sets rates in five year intervals. For the 99% of student stations that don’t exceed the ATH cap, there is no rate change for the next five years, they will simply pay the same fee. The rate setting period for the next five year period begins in ~2 years. From there, the above the cap rates could go up or down.

    “The easing of reporting duties seems an unalloyed victory – huzzah!”

    I haven’t heard from a single station that wasn’t happy about the recordkeeping and reporting relief. If you are involved with a student station, I invite you to contact me directly at ExDir@askcbi.org.

    Here are the basic facts concerning reporting.

    If the student station is a broadcast station and it webcasts, until this agreement was reached (and the adoption by the CRB), it would be required to submit reports including ATH, reports two week reports on a quarterly basis. This agreement allows most stations to pay a fee OR submit the reports without ATH data. Almost all stations we have talked to are opting to pay the fee. If this is what stations want and they now have the opportunity to do so (previously rejected by the CRB – see http://www.loc.gov/crb/fedreg/2009/74fr52418.pdf), then that is a victory.

    For those student stations that are not operating with an FCC license, the “Final Order” (http://www.loc.gov/crb/fedreg/2009/74fr52418.pdf) would have required them to file census reports (24/7/365) and not allowed ATH reporting, but the actual number of listeners to each sound recording. Most stations we work with can’t determine ATH, much less the number of listeners per song. Now most of these stations can pay the fee or supply reports w/o even ATH data if they don’t exceed the ATH cap. We think that is another victory.

    In short, the fee hasn’t changed for 99% of the stations. Most student stations now have the ability to report less data than before or no data and pay a fee. A smaller number of stations have the ability to report less frequently and supply less data than is required of others with no fee involved. Even those who exceed the cap don’t have to report the number of listeners to each song. None of this was true under the regulations before the adoption of the CBI-SX settlement.

    “I see this: “not available to non‐student stations…” and my first thoughts are, how are they going to define “non-student station”? A station with a few paid staff members who aren’t students?” Jennifer already answered this by saying that these stations must be “stations affiliated with an academic institution and need to be staffed largely by students”. This basically means that a station that has a few interns would not qualify.

    Jennifer –

    “A big question in my mind is how will the webcasting landscape change between now and 2015. I would imagine that the number of online listeners to college radio stations will increase, especially if stations continue to lose their terrestrial signals.”

    That is a good question. I expect it will grow on the large scale, but for most college stations, I see it as more opportunities for people to find lots of other stations and in *general* less listening to student stations on-line. My observations show that webcasting audiences for student stations plateaued about four years ago. Obviously that is a generalization, but when you consider the fact that IBS states that “IBS’ experience and the best figures from Webcasting II and III suggest that the average instantaneous listenerslip to small and very small non-commercial webcasters is just under four.” translates into an ATH that is far below the needed audience to exceed the cap of an average of 208. Even if listening to student stations went up dramatically, it is hard to see them growing from the IBS estimated 4 to over 208.

    To summarize –

    The minimum fee wasn’t going to change.

    Most student stations only pay the minimum fee.

    The adoption of the settlement sets reporting precedent for all student stations that allows most to pay a fee in lieu of reporting and ALL others to submit less than required for those that exceed the minimum fee, for some A LOT LESS.

    If any student station wants to discuss this in more detail, please contact me directly. I will be happy to explain your options and how this settlement and the CRB decision is a victory for student stations. I agree with Matthew that there should be an exemption, but I am afraid that isn’t in the cards.

    Will Robedee

    Exe

  5. Will Robedee January 3, 2011 at 9:43 pm #

    Sorry, I didn’t complete my sig.

    Will Robedee

    Executive Director, CBI

    ExDir@askCBI.org

    713-348-2935

  6. Jennifer Waits January 5, 2011 at 6:29 pm #

    Will, Thanks for providing all of these clarifications. Most helpful!

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