House Passes Internet Radio Bill

28 09 2008

Web radio stations live to fight another day.

The House of Representatives has unanimously passed a bill that Web radio stations have painted as life or death for their services.

The Webcaster Settlement Act, which would allow Webcasters to negotiate with the broadcasting industry for a royalty rate lower than what Congress mandated last year, passed the House by a voice vote on Saturday.

Proponents of the bill had predicted a close vote.

Tim Westergren, the founder of music service Pandora, said he was elated about triumphing in the house, which came after the National Association of Broadcasters withdrew its opposition in the House. The NAB apparently will fight it in the Senate, where the bill is expected to come up for a vote on Sunday or Monday, according to a music-industry source.

Webcasters are fighting for the right to continue negotiating with the music industry about reducing royalty rates they must pay to stream music over the Web. Any deal must be approved by the federal government.

Since Congress is expected to adjourn on Monday, the Webcaster Settlement Act enables Internet radio stations to reach an agreement with the music industry while Congress is out of session.

Westergren, who has emerged as a de facto spokesperson for the bill, said some Web radio stations can’t afford a long delay in the talks. Right now, the the law requires them to pay the older royalty rate, which Webcasters say will soon drive them out of business.

“It would be a killer blow,” Westergren said. “If we don’t get it passed now, it would mean waiting for a whole new Congress and administration and lots of uncertainty.”

As for the legislation’s chances in the Senate, Westergren said he’s cautiously optimistic.

“I’ve become gun shy because I’ve been burned so many times before,” he said. “We’re waiting to see what happens and consulting with our friends (in Congress).”


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