Report: DOJ Leaning Towards Higher Fees For Webcasters

Changes May Hurt Music Streaming Services

Higher fees could be on the horizon for webcasters such as PANDORA and SPOTIFY. ALEX BYERS writes in POLITICO, "The Justice Department is poised to make changes to decades-old music industry regulations that could impose significant new costs on PANDORA and other digital streaming services, according to five sources briefed by agency officials."

In early FEBRUARY (NET NEWS, 2/11), BMI and PANDORA headed to court, with PANDORA arguing that its service is a passive experience much like terrestrial radio and, as such, should be governed by deals BMI has struck with radio groups such as CLEAR CHANNEL COMMUNICATIONS (now iHEARTMEDIA).

Radio stations pay 1.7% of revenue for rights to broadcast the 7.5 million works licensed by BMI, but BMI wants PANDORA to pay 2.5%.

POLITICO reports, "The DOJ is leaning toward giving music publishers like UNIVERSAL and SONY/ATV, which represent songwriters and composers, more flexibility in how they sell their songs to online music platforms, the sources said. The publishers would be able to continue the current system of using so-called performance rights organizations to collect royalties from traditional outlets like radio stations but would be given the ability to negotiate directly with services like PANDORA to seek higher payments, the sources said."

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