Monday, March 23, 2009

The Multi-Million Dollar Elephant in the Room

We can no longer try to ignore this may as well dive in with both feet.

We subscribe to John Gorman's Media Blog, and for the last few weeks, Gorman has been discussing the negotiations between the radio industry (National Association of Broadcasters) and the recording industry (RIAA, the Recording Industry Association of America), and more specifically, SoundExchange, which is responsible for collecting royalties.

This week's blog noted a Radio Business Report article, which we'll link here.

The article goes into great detail, explaining how each station or broadcaster that streams via the Internet will have to pay any back-royalties dating to 2006, plus pay an increasing rate beginning this year.

The amount at first seems .0015 cents per song, per listener, that's not much. But then when you do the multiplication (average of 100 listeners per hour at 12 songs/hour) for an entire year, it comes out to about $15,768.00. Now...realizing that the amount of radio stations that play only music is slightly less than the number of radio stations in the entire country...if you multiplied that $15,768 by the number of radio stations in the United come out with $219,774,384!

That's right. About $220 million!

We're interested in seeing just how many radio stations decide to shut down their internet streams, after seeing THAT figure.

However, we figure that number would more likely be in the ballpark of $100-175 million, after subtracting the amount of talk radio stations in the US.

Still, it is a multi-million dollar thing, regardless...and it's rather shocking...

1 comment:

joe beans said...

WOXY already did -- they moved under the WVXU internet banner for shelter.