NPR fights back, seeks rehearing on Internet radio royalty increases

http://arstechnica.com/news.ars/post/20070320-npr-fights-back-seeks-rehearing-on-internet-radio-royalty-increases.html

The fees in the CRB’s decision have been increased so much so that they could cripple small and emerging radio stations and put many of the existing ones out of business almost instantly, according to claims. Previously, the fee structure was structured such that the radio stations would pay an annual fee plus 12 percent of the stations’ profits to SoundExchange, a music industry royalty collection organization. This situation appears to have worked well, in part because many Internet radio stations—as well as NPR—function on a nonprofit basis and therefore do not advertise very heavily (if at all, in some cases) on their stations. In other words, the fees matched their budgets.

Under the new fee structure, stations would pay a flat fee per-song, per-user in addition to paying a $500 annual fee for each channel owned by a station—meaning that stations that run multiple channels (like NPR) would end up paying several thousand dollars for the annual fee. Additionally, the CRB decided that new fees would apply retroactively from 2006 and are scheduled to increase significantly over the next five years.