K-12 radio stations that broadcast copyrighted music via the internet are getting an extension on royalty payments that would have been due Oct. 20. The reprieve will temporarily spare small webcasters from having to pay per-performance royalties on songs played over the web.

However, small webcasters—including such non-commercial entities as schools—still must pay up to $2,500 each in retroactive fees dating back to 1998. The fees, which are due immediately, are in accordance with a July 8 ruling issued by the Librarian of Congress and the U.S. Copyright Office.

The extension, granted by the recording industry and performance artists Oct.18, came a day after the Senate recessed for the elections without approving copyright rate revisions negotiated between webcasters and copyright holders in the Small Webcaster Amendments Act of 2002 (H.R. 5469).

The changes, unanimously approved by the House earlier this month, would have significantly reduced payment obligations for smaller webcasters, who complained that the higher rates could have put them out of business.

In September, eSchool News reported that K-12 broadcasters were surprised by the fees, which—in addition to the retroactive payments—would cost schools 2 cents per song played online for every 100 listeners, or a minimum of $500 a year. That doesn’t include an 8.8 percent payment for the use of ephemeral recordings, or temporary copies made to stream music over the internet.

Although producers were reluctant to say whether the fees would tank school-sponsored internet radio programs, many did express concern that the fees would infringe upon the types of music that could be broadcast online.

For instance, Michael Jackson, coordinator of radio media studies at Fremont High School in California, said the increase in fees could force him to weigh his options.

According to Jackson, these options include ways to skirt additional royalty fees by only playing brief portions of songs—as permitted under law—or concentrating mainly on talk radio shows and commentary as an alternative form of content.

Another director, Anthony Reece, who oversees projects for MediaTech Productions Inc. and the K-12 Radio Network, said his operation would look to cut cots by pursuing unsigned acts who agree to have their music broadcast without imposing a fee.

Only webcasters that would have qualified for reduced payments under the webcasting bill—including schools and other non-commercial entities—are eligible for the extension.

“From the beginning, we have wanted to work with webcasters, and this temporary payment policy is another example of our commitment to the webcasting industry,” said John L. Simson, executive director of SoundExchange, the organization collecting payments on behalf of the music industry and the artists.

Simson’s statement, issued Oct. 18, said the extension will be in effect until Congress can act on the bill.

The statement does not say what would happen if Congress never passes the bill, or if the president does not sign it, although the statement refers to “this Congress”— which adjourns at year’s end. A message left with Simson by the Associated Press was not immediately returned.

Traditional radio broadcasters have been exempt from paying royalties to recording labels and performance artists on the grounds that the broadcasts had promotional value. In 1998, Congress passed a copyright law requiring such royalties from webcasters.

While the Copyright Arbitration Royalty Panel proposed rates of 14 cents per song for each 100 listeners, the U.S. Copyright Office reduced the figure to 7 cents for commercial broadcasters and 2 cents for school and other non-commercial entities in June, while setting the Oct. 20 deadline for payments.

Under the settlement awaiting legislative approval, smaller webcasters could calculate royalties payments based on how much they earn or spend.

Links:

U.S. Copyright Office
http://www.loc.gov/copyright

SoundExchange
http://www.soundexchange.com

K-12 Radio NetworkM
http://www.k12radionetwork.com/site/home.asp

eSN: New copyright fees could silence school radio webcasts
http://www.eschoolnews.com/news/showstory.cfm?ArticleID=3944