Inslee brokers deal that may save Internet radio

Is there anything better to do at the office than read the Bainbridge Conversation blog?

If you answered “do actual work” you are probably too productive and hard working to care about Internet radio. According to leading Internet radio provider Pandora, most of the 7 million folks who snap their fingers and tap their feet to their online service are sitting at a cubicled computer.

It’s for those folks that Rep. Jay Inslee has some hopeful news. The Bainbridge Democrat (who once admitted to me that KEXP frequently streams into his D.C. office via the Net) earned unanimous approval in the House this week for a measure that may save Internet radio stations from crippling rate increases.

Read my story below.

While you’re at it, read my story from last September about Inslee teaming up with Indie rockers to save Internet radio.

House Approves Inslee-Backed Internet Radio Legislation
By Tristan Baurick

U.S. Rep. Jay Inslee earned the House’s approval this week for legislation aimed at saving Internet radio from crushing copyright royalty fees.

The House on Saturday gave its unanimous support for a bill sponsored by the Bainbridge Island Democrat that buys extra time for a royalties collection group and Internet radio stations to reach an agreement over sharply rising rates for the use of songs and other copyrighted content.

“The upshot of this legislation is the survival of Webcasters,” Inslee said during House floor debates. “It will be a tremendous opportunity for listeners to have great music (and) great news over the Internet.”

SoundExchange, the nonprofit group that collects royalty fees for copyright owners and artists, has been deadlocked with Internet stations over vast rate increases approved last year by the U.S. Copyright Board.

Although the hikes are only a fraction of a cent on a per-song basis, the cumulative impact amounts to a 300 percent increase for the largest stations and up to 1,200 percent for many smaller operations. Many station owners said the increase would put them out of business.

An additional $500 per-channel fee would likely snuff out large Internet radio providers, such as Pandora and Yahoo, which provide listeners with thousands of custom-tailored channels.

Inslee’s bill extends the time the government will allow SoundExchange and the stations, which operate under a federal license, to negotiate a compromise.

With Congress likely to adjourn after the November elections, Inslee added language in the bill that would allow negotiations to continue until Feb. 15, 2009.

Inslee’s bill would also give government approval for whatever deal is reached while Congress is in recess.

“It’s really simple,” Inslee said. “If the parties can reach an agreement, Uncle Sam will get out of the way.”

The bill arrives in the Senate on Monday. With the Senate go-ahead, it will then move to President Bush for final approval.

SoundExchange called the legislation a “helpful solution” that favors both parties.

Pandora founder Tim Westergren celebrated the bill’s passage but urged his company’s 7 million users to keep up the pressure on Congress.

“We want to make sure the senators know how important it is for them (to) support our resolution,” he said on his blog after the bill passed the House. “We’ll be reaching out again … for one more push.”