I am about to do the most technical article I have ever written for general public consumption and I promise not to use one technical word. All you need to know is that everything I am about to discuss can be done by an average 14 year old with a computer and a broadband connection.

As you probably already know, on March 2, 2007, the Copyright Royalty Board established a new rate schedule setting aside 2002's Small Webcaster Settlement Act (H.R. 5469) which capped royalties at an average of 10 to 12 percent of annual station revenue. People in the business recognize that the new rate schedule will most likely put an end to Internet Radio.

Why? The proposed royalties are simply too high. If the new rate schedule is adopted, Internet Radio Broadcasters (organizations that stream music the way terrestrial radio stations broadcast music) will not be able to make enough money to stay in business. And, those individuals who stream music as a passion will not be able to afford their hobby. Or will they?

Anyone who has listened to Senator Ted Stevens (R-Alaska) on June 28, 2006 knows that the Leadership does not have a handle on current technology, let alone future technology. (If you haven't heard this speech, you must stop reading now and Google "Ted Stevens" and Tubes. Click here to listen to the .mp3 file, the text does not do it justice. No one can write comedy like this, it's just not possible. And it would truly be funny, if it was not real -- but it is!). The Copyright Royalty Board is made up of learned men, but they just don't know what they're dealing with.

Radio stations that play music hire program directors to create playlists. These playlists are designed to attract a specific kind of audience. Commercial radio stations exploit their ability to attract an audience by selling air time on their stations to advertisers. Public radio stations do exactly the same thing although they use beg-a-thons and other techniques to ask the audience for money directly.

The important aspect of this music programming is that "before" the music is played on the air, a playlist is created. If you visit the website of any popular radio station, you can easily find their playlist (or a link to it) proudly displayed. Let's take Hot 97 in NY for example (www.hot97.com).

A playlist is a list of songs that they will incorporate into their broadcast day.

Internet Radio Stations are a metaphor based upon terrestrial radio stations. They don't use the same technology to propagate their signals; they send audio to their listeners over the Internet. Listeners who enjoy Internet radio do not use radios to tune in to their favorite Internet radio stations, they use a computer which, by default, must be connected to the Internet. (Actually, Internet radio is not radio at all, but we're not discussing technology.)

What do Internet radio station listeners listen to? Playlists.

What is the difference between the published playlist on http://www.hot97.com/playlist/ and the playlist that a metaphoric "Hot" format Internet radio station might play?

Nothing!

There is an old story about a very poor man who walked by the bakery each morning to smell the fresh bread being baked. The baker noticed this and wanted to charge the man for smelling the bread being baked, because he never bought a loaf. How do you think the issue was resolved?

If I know the titles of the songs and have the descriptions associated with them and I am connected to the Internet, do I really need you to send me the songs too?

Not in 2007.

We live in a world where metadata (data that describes other data) is more important than the data itself. I don't need you to send me the file of the song. I'm already on the Internet and there are literally thousands of places I can get the files. I just need the intellectual property of the gatekeeper, the professional program director, the wisdom of crowds, my social network or another trusted source to send me a list of what I want to hear. Technology will take care of the rest.

By making it too expensive for music lovers or business owners to aggregate and distribute bits and bytes of music files, they will simply accelerate the adoption of an RSS-based (really simple syndication) model of playlist propagation. Why send the actual files, when you can simply send the description (including advertising) and let the consumer's computer gather the files for you.

This technology was going to become commonplace anyway. The new ruling, if it stands, will just accelerate the adoption.

Unless we can get the Leadership to understand some rudimentary issues, we are going to find ourselves in an almost completely un-regulated, un-regulate-able online world. Get involved in this issue, we need you!!!

P.S. So I'm not breaking my word and not using any technical terms in the body of this article -- If you are interested in a very short, video-oriented example of an channelized RSS aggregation site, checkout Network2.tv. Then imagine the same type of site with music files. Then imagine that the music files were not accessed from content owners sites, but from "somewhere out there." It is child's play to create a RSS feeder/reader world that mimics the metaphor of Internet radio. And it takes no imagination at all to realize that under that scenario, nobody will get paid.

Comments

[Bill]

I believe that you are comparing apples and oranges or you yourself are misinformed. If these rules are adopted RSS technology will be directly impacted; after all who is going to use the RSS technology just to obtain the ID3 tag of a song; or a meta tag description of a song. They are going to want to hear the music itself. The perform act which is still pending in Congress as we speak will punish podcasters who use opening and closing themes to their podcast since that is in the eyes of the copyright office, those who license the music and those perform the music see that as a form of broadcasting as well. Instead of trying to punish the entire digital radio industry (which would be a very lucrative industry, might I add in the sense that we could help create jobs in the economy and bring in an additional source of taxable income for the IRS to add to the congressional spending whims annually), what needs to be done is a compromise. Let's try not to bleed the radio station owners, maybe levy a fair tariff to those who help provide the technology and make Internet radio possible (ie: The shoutcast server providers; ect) Being a internet radio provider, I am more than willing to pay an extra dollar or two per month to operate a station, the extra money could go to help recoup the loss that the music industry fears. In fact in other countries such as Canada, copyright owners are compensated by a sales tax upon digtal media (blank CD's, CD-R and CD-RW rewriteable data)to help off set the cost that the record companies would lose due to "file sharing". The point is; Internet radio isn't the only victims in these vicious politically motivated attacks, it's going to be a far more reaching devastation and RSS technology is not exception.

[Bill]

Ok, just to clarify some misunderstandings on my part I now realize what Mr. Palmer was alluding to. There are more than one way to obtain digital music, ie: Streams from internet webcasts, yes RSS feeds (as so elegantly explained by Mr. Palmer himself via an email conversation that I had the pleasure of having with him) and of course the dreaded Peer to Peer method but unfortunately for congress they are battling a can't win war on digital music there are just too many avenues in which anyone with an internet connection and a desire to obtain music can utilize to circumvent any restrictions that they (they being congress) try to implement. Killing a thriving industry such as digital radio isn't going to solve their problems, in fact it'll simply just add to it with internet users just purely revolting, increase what congress and the RIAA considers "piracy" and then I am sure in some twist of PR grand standing in the media digital radio will be the scapegoat as for an excuse. It's a never ending vicious cycle and I really wish for once congress would get their heads out of the sand, start making entertainment distribution equal across the board so that perhaps we can all enjoy music without the threat of a $3,000 plea bargain hanging over our heads.