WebProNews

New royalty rates for webcasting go into effect on Sunday, but SoundExchange will not immediately attempt to collect them from members of the Copyright Royalty Board.

Webcasting Reprieved At Last Minute

In punishment terms, it's a stay of execution, not a pardon.

Encouraging news emerged from Washington at a last-minute hearing on new royalty rates to be charged to online radio websites. The proposed increases prompted a host of webcasters, like Yahoo and Pandora, to say the higher rates would shut down their webcasting efforts.

Wired reported on the change of heart from SoundExchange during a closed door meeting in Washington:

The SoundExchange executive [Jon Simson, executive director] promised -- in front of Congress -- that SoundExchange will not enforce the new royalty rates. Webcasters will stay online, as new rates are hammered out.

The amazing turnaround comes shortly after the DC District Court of Appeals declined to act on a petition for delay for the July 15th deadline to enforce the higher royalty rates. SoundExchange and webcasters now have the groundwork for negotiating a more equitable rate schedule.

Until that happens, the threat to online radio has not ended. Pandora founder Tim Westergren told Wired that public efforts to bring the matter to the attention of members of Congress evidently worked, and credited the change in circumstance to web radio listeners who contacted their representatives in DC.