By August 19, 2008

Internet radio is about to get punched in the balls … again.

I’ve written about how royalties have threatened Internet radio in the past. According to this Ars Technica article, it seems like the Sound Exchange is trying to drive nails in the coffins of my favorite Internet radio stations. Ars Technica discusses the awesome-o Pandora in particular, but the disproportionally high royalty fees will affect all of the Internet radio stations I listen to, including SomaFM and Frisky Radio.

The crux of the matter is that Sound Exchange pushed a royalty fee increase last July and will force Internet radio stations to pay 2.91 cents per hour per listener. This is very high in comparison to what satellite radio pays (1.6), and even satellite pays more than terrestrial radio. Pandora has an estimated one million listeners a day.

Pandora’s founder Tim Westergren stated in a Washington Post article that they will fold up shop if the royalty act is not repealed somehow.

I have a vested interest in the future of Pandora because my buddy BushPutin works there. I really like my Internet radio, and hopefully you enjoy a niche sound somewhere being “broadcast” by people who love music too. BushPutin says the standard line at Pandora is to contact your senator. You can also get more information at Savenetradio.org.

Hold your breath, we’re not out of the woods by a long shot.

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