The whole mess, that has taken years to solve, was created by the U.S. Congress in 1998 by setting up a royalty fee for Net radio broadcasts (while traditional radio stations in the U.S. don't pay any royalties whatsoever). The mistake they made was that they didn't specify how much the royalty fee should be.
Anyway, the last decision that was made about the royalty rates was made after talks between RIAA and small group of webcasters, most notably including all the biggest webcasters, that set the current royalty rates. Current system is that webcasters pay royalties based on certain percent of their revenue (with an exception of large webcasters who pay fixed price per each broadcasted minute).
Now the Webcaster Alliance has sued RIAA because it claims that RIAA has refused to negotiate with them for alternative royalty rates and claims that the group of webcasters that negotiated the current royalty system didn't represent webcasters in general, but only a group of specific type of webcasters.
Source: News.com
Written by: Petteri Pyyny @ 28 Aug 2003 15:46
