Based on the decision of the Copyright Royalty Board (CRB), internet radio stations could be a thing of the past. Whereas a normal terrestrial radio station pays a simple yearly fee ( $972 per year per station) it has been decided that internet streaming companies should pay per user per song. The rate they quote is $.0008 per song per user. That sounds cheap enough until you look at actual numbers. BetaNews gives the example of AOL Radio, who based on average past usage, would have to pay on 569,614,272 performances for each week in the month of November 2006. That’s about $456k per week.
If it wasn’t stupid enough for them to propose this fee structure, the fact that they want it to be retroactive should remove all doubt. If I were one of the operators, I would say there is no way it is legal to go back and decide that you owe them millions of dollars on a rate structure that did not exist at the time. If they want to impose that structure now, then fine, I shut it down and pay you nothing.
Legal or not, I doubt that music companies could find many more things to be totally unreasonable about. I would hope a settlement could be reached, but who knows with these music clowns. Gizmodo’s RIAA Boycott is sounding better and better.