Webcasters were dealt a crushing blow by new royalty rates that were drawn up by SoundExchange and then upheld by the Copyright Royalty Board. The rates will put many webcasters out of business on May 15th unless somebody does something about it. The two leading options: webcasters are granted an appeal or Congress steps in.
In what I think is a disingenuous move to try to head off those possibilities, SoundExchange has "reached out" to certain webcasters with the idea of setting up special deals that would permit certain webcasters to survive by ostensibly paying something other than the recently upheld rates. According to John Simson, Executive Director of SoundExchange, the organization "sought a dialogue with these services in orderto determine if there is an appropriate business solution thataddresses their concerns while still ensuring fair compensation forartists."
Translation? If the RIAA-affiliated SoundExchange likes a specific webcaster, it'll give them special rates. If it doesn't like the webcaster, the recently-upheld rates will apply, and the webcaster will go out of business. Suddenly, SoundExchange has a powerful tool for controlling the webcasting market.
SoundExchange claims it wants to preserve webcasting, but it's easy to imagine the organization granting survival to a few key partners, which could be nearly as detrimental to the webcasting market as forcing everyone to pay the new rates.
