Small Webcasters to Launch Industry Trade Group

Small Webcaster Community Initiative (SWCI), a coalition of streaming-media companies, today announced their intent to form a U.S. trade association. The new organization aims to promote and protect independent online music radio through grassroots civic campaigns, including political action and educational outreach. In addition they should not try to silence an entire industry. People need choices, and currently terrestrial radio does not offer that choice. Internet radio does. This announcement comes in the immediate wake of a determination by the U.S. Copyright Royalty Board for significantly higher royalty rates for all Internet radio stations operating under the Section 114 and Section 112 statutory licenses. Previously, the Small Webcaster Settlement Act had provided a much-needed “safe harbor” to thousands of small commercial and non-commercial Webcasters who could not afford the prohibitive rates and terms set forth by the Librarian of Congress in 2002. “A shifting regulatory climate has the potential to radically transform how digital music services do business in the coming years — but this current trend, if it continues, will impose an unnecessary barrier-to-entry for startup companies while concomitantly stifling technological innovation and restricting consumer choice,” states Executive Director, Randall Krause. “Unfortunately, our segment of the streaming media industry still lacks adequate political representation. A coherent constituency that caters to the unique needs and concerns of small Webcasters will not only be better equipped to respond to rapidly changing market conditions, but could also play a more direct role in shaping public policy. Our coalition adopted the slogan ‘Long Live the DJ in You’ because we firmly believe that the willpower of the people will ultimately prevail.” Charles St. James, a licensed small Webcaster and pop-music enthusiast, readily endorses the proposition of a trade association: “I hope that efforts of lobbying and education will… address the exorbitantly high royalty rates and other fees the Copyright Royalty Board recently approved. Also, I am optimistic that such an association could cause Congress to revisit some of the problematic aspects of the Digital Millennium Copyright Act.” A variety of digital music services have already teamed with Small Webcaster Community Initiative including Barnabas Road Media, Live365, MusiK1.net, Surround Mobile, and SWCast Network. “SoundExchange needs to realize that Internet radio broadcasters only serve as an alternate means to promote their content,” explains Soshahi Wilson, Founder and CEO of Surround Mobile. “In addition they should not try to silence an entire industry. People need choices, and currently terrestrial radio does not offer that choice. Internet radio does.” “The concept was flawed before the process even began,” agrees Paul Gathard, Founder of Barnabus Road Media. “Webcasters must come together and seek the kind of representation needed to bring fairness and balance back into the royalty setting process. We need a trade association that can proclaim ‘Don’t Tread On Me’ and have the collective power to put teeth into the warning.” Josh East, Senior Project Manager for MusiK1.net, offers another perspective: “The current CRB ruling may end up forcing stations to take on the royalty waiver approach. It will be a no-brainer to exchange royalties for airplay, especially when the majority of indie artists and labels only see a very low royalty check from such spins in the first place; thus the promotional value in waiving their rights now becomes an investment for their record campaign. “It’s time to pull rabbits out of a hat in support of music independence,” proclaims Mr. East. Associate membership will be open to all small commercial and non-commercial Webcasters whose principal offices are located in the United States and whom subscribe to an established code of conduct. Non-associate membership will be available to any companies that primarily offer products and services to the streaming media industry. Small Webcaster Community Initiative has retained The Alderman Law Office of Washington D.C. to provide guidance on matters of intellectual property law, with a particular focus on emerging Webcasting technologies.