STEVE INSKEEP, host:
Today many fans of Internet radio, including those listening to some public radio stations on the Internet, will be tuning in...
(Soundbite of music)
INSKEEP: ...tuning into music like that, but then hearing nothing. That's because many Webcasters are participating in a national day of silence. It's a protest against what the Webcasters call excessive royalties on the music that they send to you. New royalty rates are said to take effect in little more than three weeks.
NPR's Felix Contreras reports.
FELIX CONTRERAS: Organizers of SaveNetRadio, a coalition of Webcasters protesting the hikes, say Internet radio outlets big and small will be participating - Pandora, Rhapsody, AccuRadio, one of Yahoo's free radio streams, and many smaller outlets will all go black for all or part of the day today.
In between the silence, many outlets will be playing announcements explaining the protest and asking listeners to write their senators or representatives. That's what Live365 will be doing. It's an Internet radio site that aggregates 10,000 independently programmed channels. Johnie Floater is Live365's general manager of media. He says listeners have supported the fight against the rate hikes. He also says Live365 is willing to forgo its ad revenues because royalty rates do not take into consideration the value Web radio offers the music industry.
Mr. JOHNIE FLOATER (General Manager of Media, Live365): We have to look at what Internet radio does for the music industry. And besides coming up with royalties, it comes up with an immense amount of promotion for a wide amount of artists that are not heard anywhere else. You're going to silence probably one of the most powerful tools for music, and that's what you're going to hear - silence.
CONTRERAS: Today several public radio stations will also shut down their music streams to protests the rate hikes that are set to take effect July 15th. The new rates were imposed by the Copyright Royalty Board, a three-judge panel established by the Library of Congress to oversee royalties in the digital domain. The new rates are based on a per-song, per-listener formula. The old rates were based on a percentage of the Webcasters' revenue. The burgeoning Internet radio industry has collectively argued that those rates will put many Webcasters out of business.
At a recent conference on digital media, Jonathan Potter, executive director of the Digital Music Association, said silence is what listeners can expect if the new rates go into effect.
Mr. JONATHAN POTTER (Digital Music Association): Silence may become the pervasive sound on the Internet if the royalty rates go into effect on July 15th. I think the goal is going to be to persuade people to do something to help the Webcasters stay on the air.
CONTRERAS: Those supporting the royalty increases say the money goes to musicians that are creating the content for the Webcasters. John Simpson is the executive director of Sound Exchange, the organization created by the recording industry to collect royalties from the Internet radio outlets.
Mr. JOHN SIMPSON (Sound Exchange): The absence of music will happen when performers aren't adequately compensated fairly for creating. So I think in their own backhanded way they're proving our point, which is performers need to be compensated so we will have wonderful works being created.
CONTRERAS: Congress has already gotten involved in the royalty fight. There are two bills making their way through the House and the Senate to roll back the rates. Webcasters and National Public Radio, on behalf of its member stations, have also asked a circuit court in Washington, D.C. for an emergency stay of the Copyright Royalty Board's decision. Both sides say they are open to a negotiated settlement to the royalty issue outside of the courts and Congress.
Felix Contreras, NPR News.
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