how do you hear them via sattle lites?
----- Original Message ----- 
From: "Michael Hughes" <[email protected]>
To: <[email protected]>
Sent: Tuesday, January 01, 2008 1:29 PM
Subject: Re: [General-discussion] Royalty Status


> Al.
>
> I sincerely appreciate your opinion. One additional couple of points are 
> that you can now hear OUR webcast stations in cars through satellite. 
> There will be another point of contention for rotalties.
>
>
> ----- Original Message ----- 
> From: "Grampa Al" <[email protected]>
> To: <[email protected]>
> Sent: Tuesday, January 01, 2008 8:07 AM
> Subject: Re: [General-discussion] Royalty Status
>
>
>> Michael Hughes wrote:
>>> I have heard nothing in the last couple of months.
>>>
>> I sincerely doubt that there will be any real progress on the royalty 
>> issue in the near term. In fact unless a wall cracks I don't see any real 
>> action for 2008, The bill(s) in Washington are going to find out how good 
>> Washington is at lip service while proceeding forward at about the same 
>> pace as crude oil running uphill in Alaska in the month of January. It is 
>> an election year and while having done some additional checking at 
>> various websites, I haven't seen or heard, anything at any of the 
>> presidential wannabes websites that could potentially lend some speed to 
>> these bills being pushed harder.
>>
>>
>> As to resolution between the major music houses and the terra 
>> broadcasters, well, there is more opportunity here. Working in 
>> SoundExchange's advantage is this soft economy. Radio really would like 
>> to see this drag out. I do believe that most radio exec's recognize that 
>> they will begin to pay performance royalties in the very very near 
>> future, just as they are suppose to for their ever increasing web 
>> streams. Keeping that in mind, you are gonna see even more consolidation 
>> especially in the smaller markets. Why? Costs are going to increase due 
>> to those royalties whatever they become. Business models will have to 
>> adjust. And with even fewer organizations to negotiate with, resolution 
>> becomes a bit easier to achieve. Smaller market stations who rely more on 
>> local advertising then the major markets, will have a much tougher time 
>> adjusting their business models to maintain profit levels, leave alone 
>> grow profits in this tenuous economy.
>>
>>
>> Quick aside here, with pressure to increase listenership and potential 
>> profits, some of the larger small market terra stations are going to look 
>> to the web for revenue increase. (NPR has lead the charge in this area.) 
>> They are coming after the same listener that small webcasters have 
>> courted and they are going to use many of the same methods of revenue 
>> generation that you use. They are gonna partner with retail outlets to 
>> sell CD's T-shirts etc. This will make your competition that much 
>> stiffer.
>>
>>
>> Sometime in very late 2008 or more probable in 2009 (and quite possibly 
>> 2010) I think you will see true progress. I think you will see a 
>> performance royalty established at approximately 8% to 10% of revenue 
>> generated. There will be some healthy discussion about web generated 
>> versus traditional revenues but the market is going to resolve this in 
>> favor of web generated without excluding traditional,
>>
>> As to the figure, well, look at the satellite people. Think long and hard 
>> also about the fact that almost any settlement with SoundExchange has 
>> included a gag clause to keep agreements sealed. The satellite settlement 
>> was allowed to ?leak? in the area concerning that percentage. Why? Well 
>> to tip their hands as to which direction the music industry wants to go. 
>> And people, that is a very good number for you, the small webcaster.
>>
>>
>> I also think that in that time period, a true small webcaster rate will 
>> be established (as well as a separate non-profit rate) that will be just 
>> slightly lower.
>>
>>
>> Okay, I'll kick my soapbox out of the way and pack up my Mr. Microphone. 
>> My 2 pennies have been left behind in their place.
>>
>> To all on the list Happy New Year, may all have a profitable year.
>>
>> -- 
>> Al Rehmann
>>
>>
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