In protest of a recent rate hike of 0.012 cents per song, per listener, from the current 0.007 cents rate (that's about 270% for you math gurus) by the US Copyright Royalty Board, the SaveNetRadio Coalition is staging a "day of silence" tomorrow. These rates are retroactive from January 1, 2006, meaning that net radio stations will owe back royalties for almost 17 months) and extend until December 31, 2010.

SaveNetRadio is calling July 15th "The Day the Music Dies," and while that may be a bit melodramatic, the rate hikes will undoubtedly knock many independent Internet radio stations down for the count.

Live365 predicts that the rate increase will shut up to 80% of its stations and reduce its 260 broadcasting genres to just 10. Last year, Live365 paid SoundExchange, the group that collects and distributes sound recording royalties, $1 million on behalf of its broadcasters, who pay an average of $60 to run their online radio stations. It is estimated that the retroactive rate increase will force Live365 to owe $4.2 million.

SHOUTcast, a software program used to stream Internet radio over the WinAmp media player, usually lists around 18,000 radio stations at any given time during the day (that number changes minute to minute as stations pop on and offline), and over 200,000 listeners. The vast majority of those stations would be forced to close, given the rate hikes (or operate illegally -- SHOUTcast leaves legal matters up to its users, so many of the stations may currently operate outside of the law).

SaveNetRadio hopes the day of silence will call the issue to the attention of listeners and urge them to act by writing to congressmen in the US in support of the "Internet Radio Equality Act." The bill, which is sponsored by Rep. Jay Inslee (D-WA), would overturn the decision by the Copyright Royalty Board and instead set the rate paid by webcasters for performance rights to the same paid by satellite radio, which is a percentage-of-revenue based scheme (currently 7.5%).


Independent net radio giant Live365 will participate in tomorrow's blackout.

According to Jake Ward, a spokesperson for SaveNetRadio, 14,000 Internet radio stations will go dark tomorrow, including big players like Yahoo!, Live365, Pandora, Rhapsody, and MTV, as well as a number of terrestrial stations that also broadcast online. Conspicuously missing from the list is CBS-owned Last.fm (as noted by Duncan Riley over at TechCrunch).

When we wrote about about the user response to CBS buying Last.fm in May, we noted that some users feared that CBS ownership would mean the site would get more "corporate." TechCrunch notes that CBS "has deep pockets and a much larger advertiser pool from which to cover costs under the new royalty scheme." But nonetheless I agree with their assessment that not participating in the day of silence may cause a user backlash. It certainly feels like a "corporate" move.

What do you think? Will the day of silence affect you enough to contact your representative (if you're an American)? Are the Internet radio stations fighting a losing battle against the lobbying groups for satellite and terrestrial radio? Also we're running a poll on this - see below.

Microphone image from Flickr user pfly.