With potentially devastating royalty rates looming this weekend, a deal was brokered last night that will allow some US Internet radio stations to stay online at least a little while longer. SoundExchange, the group charged with collecting royalty payments, agreed not to enforce the new rates temporarily while a deal is worked out, according to WIRED.
“[WIRED] just spoke with Pandora founder Tim Westergren, who expressed relief that Pandora wouldn’t have to shut down on Sunday in response to the new rates. He said, “It was getting pretty close. I always had underlying optimism that sanity was going to prevail, but I was beginning to wonder.””
(source)
What was the reason for such a dramatic reversal by SoundExchange, who just yesterday praised a court decision upholding the Sunday deadline for instituting the new fees? Ars Technica speculates that it likely had to do with the looming potential of congressional action in the form of the “Internet Radio Equality Act of 2007” and an 11th hour round table convened by Rep. Ed Markey (D-MA).
A couple of weeks ago a large number of Internet radio stations staged a day of silence in order to boost support for their cause. Pandora’s Tim Westergren thinks that pressure put on congress by the general public is what caused people like Senators Ron Wyden (D-OR) and Sam Brownback (R-KS) (sponsors of the equality bill) to step up in support of Internet radio. It seems entirely possible that the day of silence protest caused net radio listeners to put more pressure on their congressional representatives. Westergren told WIRED, “This is a direct result of lobbying pressure, so if anyone thinks their call didn’t matter, it did. That’s why this is happening.”
It’s important to note that this is a reprieve and not a complete reversal. The hope among Internet radio stations is that they’ll have more time to find a workable solution.
