Billington's webcast ruling based on Yahoo!/RIAA deal, says Mark Cuban
On June 20, Librarian of Congress James Billington issued his final ruling
on webcasting saying, in essence, that webcasters must pay copyright holders
a rate amounting to 70 cents per song per 1,000 listeners of Netcasts.
Lauded by some and derided by others, the ruling seems, at the least, to
have been developed after due consideration.
But, says Broadcast.com founder Mark Cuban, things aren't as they appear to
He says Billington's decision was based on a plan designed by Yahoo!
[Broadcast.com's owner] to shut out small webcasters and decrease
competition, and was itself part of another deal between Yahoo! and the RIAA
(Recording Industry Association of America).
Cuban made these claims in an email to RAIN (Radio And Internet Newsletter -
www.kurthanson.com) on June 23.
"Yahoo! Broadcast offers rich audio and video content and services through a
digital distribution network. It is designed to deliver high quality audio
and video to large audiences via the Internet through both dial-up and
That's what it says on Yahoo!'s web site. But on June 25, if you tried
http://broadcast.yahoo.com, all you got was a blank. And that may have been
because Mark Cuban, the man behind the service, is no longer with Yahoo!.
Although he'd left the company by the time the Yahoo!/RIAA deal was
signed, he explained in the email that he'd helped put it together and that
it had included a high royalty price to avoid a 'percentage-of-revenue'
royalty rate, the idea being that low-revenue webcasters wouldn't be able to
compete against Yahoo!.
RAIN publisher Kurt Hanson declared, "Whereas Congress instructed the
Librarian and the CARP to set a rate based on what a willing buyer and
willing seller WOULD pay, taking into account several different criteria,
both the CARP and Billington set a rate based almost exclusively on what one
grudging seller [the RIAA] and one atypical buyer [Yahoo!] DID pay, taking
almost none of the other criteria into account."
In his email, Cuban states:
"I also wanted there to be an advantage to
aggregators. If there was a charge per song, it's obvious lots of webcasters
couldn't afford to stay in business on their own. THEREFORE, they would have
to come to Broadcast.com to use our services because with our aggregate
audience, if the price per song was reasonable, we could afford to pay the
royalty AND get paid by the webradio stations needing to webcast."
Hanson says on his site, "If I were a Congressman, I'd be FURIOUS right now:
In setting a statutory license designed to encourage the growth and
diversity of a new industry, the arbitrators and the Librarian ignored
Congress's instructions and used the terms of a deal that was specifically
constructed to have the opposite effect!"
For the complete Mark Cuban email, visit www.kurthanson.com/cuban/
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