US online royalties body SoundExchange has announced that it won't be taking action against webcasters who do not immediately adhere to the new royalty rates that came into effect this weekend, despite the fact the courts last week refused to formally delay the start date of the new rates.
SoundExchange's announcement follows much political lobbying and public campaigning on the part of the American webcasting sector ever since the US Copyright Royalty Board announced it was putting up the royalty rates internet radio stations had to pay the record labels in order to play their music. As previously reported, the CRB refused to reconsider its decision, although it did push back the date when the new rates kicked in, to yesterday. The webcaster's appeal of the royalty ruling continues to work its way through the courts, though attempts to get a temporary court decision to postpone the start date of the new royalties while the appeal carries on were denied last week.
However, SoundExchange, who lobbied for and still stand by the CRB's original decision, made a friendly gesture this weekend when it said it would allow stations to continue to operate under the old royalty system providing they are in legitimate discussions with the royalty body regarding finding a workable settlement for moving forward. SoundExchange also announced they were offering to cap the 'minimum charge' for those webcasters operating multiple channels at $50,000 per year. Under the new rules the minimum charge is $500 per channel, so the new deal favours those webcasters with more than ten channels, though only if they are willing to commit to providing more detailed stats and to introduce measures to help stop 'streamripping' piracy. One larger webcasting company, DiMA, has already announced it will sign up to that offer, though on the proviso it can continue to negotiate on actual royalty rates.
SoundExchange's concessions come as the record industry faces a difficult fight over internet royalties in political circles, where one bill is under consideration to formally postpone the start of the new royalty rates, while another - presented in both Senate and the House Of Representatives - proposes overruling the CRB entirely and introducing a new royalty system that would be much more favourable to the internet broadcasters, many of whom claim the CRB's new rates will put them out of business.