Bill offers Net royalty relief

Six-month delay would begin Oct. 20

Indie Webcasters, chafing under what they say are prohibitively high royalty rates, may get an 11th-hour reprieve from Washington, thanks to a bill from House Judiciary Committee chairman F. James Sensenbrenner Jr. (R-Wis.).

Sensenbrenner’s bill, unveiled late Thursday, would put off for six months a ruling by Librarian of Congress James Billington that established a fixed royalty rate for streaming music on the Web. Ruling, reached in July, set the rate at 0.07 cents per work streamed.

The six-month delay would begin on Oct. 20, shifting the deadline out to late April.

Billington’s July ruling drew criticism from all sides of the royalty debate. Copyright holders argued that the rate was far too low to reflect the real market value of the music being streamed, while Webcasters complained that the rate would put small, independent players out of business before they could even get a foothold in the market.

Both sides have lobbied Congress heavily for an entirely new arbitration process to determine rates. Billington’s ruling amended the findings of a previous Copyright Arbitration Royalty Panel, arguing that the reasoning behind its determination was flawed.

Jonathan Potter, head of the Digital Media Assn., applauded Sensenbrenner for attempting to give vital breathing room for more negotiations to take place over the final rate.

“We’re incredibly grateful that the chairman chose to stay the execution of hundreds of small Internet broadcasters,” he said.

A rep from label trade org the Recording Industry Assn. of America called the bill “a surprising development, considering how productive our discussions with the Webcasters have been.”

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