Copyright battles stifle online radio broadcasts

Friday, August 24, 2001

With the advent of the Internet, many radio stations took advantage of the medium by offering broadcasts online, making their programming available to nearly anyone with a computer hookup.

But many broadcasts have dropped off the Internet over the past year as radio stations have faced one copyright battle after another. A recent ruling from a federal judge in Philadelphia addressing music licensing means many of those online broadcasts won’t reappear soon.

U.S. District Judge Berle Schiller said current law requires station operators to pay licensing fees for music they play online, even though it provides an exemption for traditional broadcasts. His decision upheld a December ruling by the U.S. Copyright Office that said online broadcasts don’t enjoy the same exemption.

“While technology has increased exponentially in the last 20 years, Congress has relied on and vested in the Copyright Office certain powers to cope with the ever-evolving technological landscape,” Schiller wrote in his Aug. 1 decision. “It is this interplay between Congress and the Copyright Office which must set the guidelines. As much as possible, courts should be passive players in this quickly changing area.”

Schiller’s ruling irked broadcasters, who contend that stations should not be required to pay royalties for programs they stream over the Internet.

“Broadcasters, record companies and consumers have long enjoyed a symbiotic relationship whereby airplay on radio stations benefits all parties, along with generating enormous revenues for the record labels,” NAB President Edward Fritts said in a statement. “We’re disappointed that this unique relationship will be disrupted by the court ruling.”

While the issue involves copyright, some station owners say the ruling also infringes upon their First Amendment rights to broadcast and their fair-use privileges. The online broadcasts, they contend, are but an extension of the over-the-air ones.

Schiller’s decision to uphold the Copyright Office’s ruling is but one of a series of events that have stifled online broadcasts over the past year.

  • Last spring, the American Federation of Television and Radio Actors negotiated with several advertising associations a new contract that includes additional fees if radio commercials appear in Internet broadcasts. Unable to strip such ads from streaming broadcasts, many stations opted to yank entire broadcasts from their Web sites.
  • More than 50 music publishers and songwriters have filed lawsuits against, accusing the Internet firm of violating copyright laws. They said the company converted protected music into the popular MP3 format, enabling listeners to download songs for free. To date, the company has paid more than $160 million and is developing a new online distribution system as part of negotiations with the recording industry.
  • In perhaps the most celebrated case, a panel of the 9th U.S. Circuit Court of Appeals ruled last January that Napster must prevent people from using its service as a clearinghouse to swap copyrighted music without charge and without restriction.

Hank Barry, executive director of the embattled Napster, blamed “copyright absolutists” for these incidents and the recent skirmishes in court and Congress over online music.

“This is a very big battle that we’re all engaged in, and it has very little to do with Napster,” Barry said at a library conference in June. “It’s a battle over access to information.”

As for the issue of streaming music online, NAB’s Fritts said the broadcasting industry already pays more than $300 million annually in music licensing fees to compensate songwriters and music publishers. He said radio exposure adds tens of millions more dollars to the recording industry’s coffers.

“Any additional fee to compensate record companies would be unfair and unreasonable, and for that reason, we are reviewing our options,” Fritts said.

But Hilary Rosen, executive director of the Recording Industry Association of America, said the ruling affirms long-held rights of artists and record companies. In a statement, she said the decision clears a path for “working with the broadcasters for a smooth transition into this marketplace.”

Cheryl Leanza of the Media Access Project said U.S. copyright laws stand in “a very weird place” in the Internet Age and fail to address complications involving fair use in cyberspace.

“The law is not well-drafted,” Leanza said in a telephone interview. “Whether we need special exemptions for broadcasters is not a problem the rest of the world is having. In the rest of the world, the rights of the broadcaster are assumed.”

But another expert on free-speech and copyright issues said both the court and the U.S. Copyright Office correctly interpreted federal copyright to forbid unauthorized broadcast of copyrighted music.

UCLA law professor Eugene Volokh said the U.S. Supreme Court determined federal copyright laws to be constitutional but established a variety of fair-use principles that allow others to use portions of protected works for criticism, parody or research without obtaining licenses.

Online broadcasts usually don’t involve criticism, parody or research, he said. Instead, they reflect the traditional broadcast in its entirety and music in its complete form.

Volokh agrees that the radio industry has enjoyed a long-established and federally protected right of public performance of copyright material. But he said the practice of streaming music over the Internet takes broadcasters out of the safe harbor because copying is required.

“With the Internet or any kind of computer media, the transmission of songs, even the streaming format, involves copying,” he said. “Once you shift from pure performance, even if it seems incidental, you are out of the safe harbor. Broadcasters end up needing to get permission to reproduce the music.”

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