College radio stations play waiting game after new law delays fees for webcasting


Recording industry shows interest in negotiating with campus broadcasters; students cautious





Cayuga Community College's WDWN in Auburn, N.Y., a new lease on life.

WDWN quit webcasting last summer out of fear that it could not afford to continue, after new copyright fees for music broadcast on the Internet were announced. But with the signing of a new law, Public Service Announcement Director Brett Wood said his station, like many others across the country, plans to play the waiting game.

'If we can afford to go back online, than we will, if not, we won't,' said Wood.

Webcasting fees and record-keeping requirements meant to help compensate record labels and artists were supposed to go into effect on Oct. 20, but now they will be delayed by the Small Webcaster Settlement Act signed by President Bush on December 11.

College webcasters and their supporters say the law leaves them increasingly optimistic, but still cautious about their ability to afford the fees.

The Digital Millennium Copyright Act of 1998 dictates that noncommercial stations, which includes nearly all college radio stations, pay .02 cents per listener per song that is broadcast on the web, while commercial stations pay .07 cents per listener per song. A minimum annual fee of $500 is applied to stations in both groups.

Librarian of Congress James Billington released the final set of royalty fees on June 20, 2002. Because payment is retroactive to October 1998, even if stations owe the minimum fee, they could owe upwards of $2,500, enough to put many over budget.

The Small Webcaster Settlement Act delays the due date of the fees until June 2003.

The bill has opened a new opportunity for negotiations between college webcasters and the recording industry and will likely benefit college webcasters, according to Michael Papish. Papish is the technology and policy adviser for Harvard University's WHRB and the Intercollegiate Broadcasting System, a nonprofit organization representing more than 750 educationally affiliated stations.

'[College webcasters] are definitely in a better position today than they were [in October],' said Papish.

After the fee schedule was released, many college stations quit webcasting immediately. Others say they have taken a 'wait and see' attitude or have limited their webcasts to non-music presentations.

The final record-keeping rules have not been determined. Papish suggested they will probably require disk jockeys to list the artist, song played, the number of times played and the number of listeners on the Web when the song was played.

Papish said The Small Webcaster Settlement Act could make it possible for all four different groups ' large commercial webcasters, smaller commercial webcasters, noncommercial college webcasters and the recording industry ' to settle on rates specific to each group's needs.

Almost no small commercial webcasters and college webcasters could afford to participate in a Copyright Arbitration Royalty Panel that met in 2001 to set the royalty rates.

In addition to the fee delay, the act places sole negotiation and fee-collection responsibilities with SoundExchange, an organization of recording companies and artist representatives.

John Simson, executive director of SoundExchange, has expressed faith in reaching a mutually agreeable solution, something Papish said webcasters have found promising.

'[The Small Webcasters Settlement Act] provides all parties time to address the unique circumstances of noncommercial webcasters and reach an appropriate arrangement,' said Simson in a recent statement.

Will Robedee, general manager for Rice University's KTRU and creator of the Save Our Streams Web site, which tracks Digital Millennium Copyright Act issues, said he remains cautiously optimistic that a suitable agreement can be reached.

'[The Small Webcasters Settlement Act] only compels the recording industry to negotiate with commercial webcasters, college webcasters will presumably be next,' said Robedee. Recording industry representatives have expressed an interest in striking a deal with college radio, but nothing definite has been decided, he said.

College radio stations' role as nonprofit, educational entities should qualify them for an altogether different scale of rates, said Robedee.

Papish said the recording industry has favored college radio in the past, cutting better deals on traditional 'terrestrial' broadcasting than what is charged to commercial entities. While commercial stations pay rates for traditional broadcasting that are based on how powerful their signal is and how many people are listening, college stations must only pay a fixed fee.

Papish has pointed to the fact that a college webcaster with a steady Internet audience averaging about six or seven listeners per hour (a typical number for many college stations) would owe $170 per year, but be forced to pay the $500 minimum fee. Moreover, if the webcaster's audience grows over the next decade to numbers similar to its FM audience, (many average about 1,000 concurrent radio listeners), the station would owe $26,280 ' compared to about $3,200 the station would pay to play the same songs over the air.

College webcasting does not necessarily exploit the recording industry like commercial webcasting arguably does, Robedee said. Instead, it often helps record labels by playing and promoting underexposed artists that can not be heard elsewhere.

'If you take a look at [the recording industry's] argument that businesses are making money from other people's work, that's not the case [with college radio],' said Robedee.

While the amount webcasters owe in royalty fees is of primary concern for most stations, others have said the complexity of the record-keeping requirements is more daunting.

Lee L'Heureux, General Manager at WMHB at Colby College in Waterville, Maine, said that while his station will probably find a way to pay the fees, complicated and time-consuming record-keeping could keep the small staff out of the webcasting business.

Papish, who sat on the arbitration panel with large commercial stations and music industry representatives that discussed the rates, said webcasters should not be concerned about crunching numbers.

'At the end of the day, as long as the stations come up with the money, SoundExchange will accept [it] even if you don't have the most pristine records to go along with it,' Papish said.

David Goldberg, general manager of WMUC at the University of Maryland in College Park said his station never thought about halting its webcast.

'We're lucky enough to have a big university funding us,' said Goldberg. He said the fees would necessitate a budget cut, but would not silence WMUC on the Web.

WMHB at Colby College stopped webcasting music in August, though disk jockeys still cover sports and offer some other non-music programming, according to L'Heureux.

'We're still taking a wait and see approach,' said L'Heureux. 'While [the Small Webcasters Settlement Act is] not everything we wanted yet, it gets the ball rolling.'

Papish said the conflict over webcasting shows the music industry at a crossroads, unsure of how to keep music profitable in the Internet Age.

'It's a difficult question,' said Papish. '[The recording industry] hasn't really figured out the model that's going to work, so you can understand their trepidation. I think they're trying to open up and figure out how to make it work with webcasters.'


reports, Winter 2002-03