[Congressional Record Volume 158, Number 129 (Friday, September 21, 2012)]
[Senate]
[Pages S6628-S6629]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. WYDEN:
  S. 3609. A bill to adopt fair standards and procedures by which 
determinations of Copyright Royalty Judges are made with respect to 
webcasting, and for other purposes; to the Committee on the Judiciary.
  Mr. WYDEN. Mr. President, today I rise to introduce the Internet 
Radio Fairness Act. The goal of this proposal is to help one of 
America's oldest, most dynamic industries grow into the 21st Century. 
Thanks to new digital music technologies, the ways in which consumers 
can listen and buy music has been revolutionized.
  Internet technology is even changing the music industry itself. The 
Net is freeing artists from the shackles of major record label 
middlemen by enabling artists to broadcast and sell directly to 
consumers. In fact, right now bands on independent labels are 
dominating the music charts. Artists like Amanda Palmer are leaving the 
record labels behind by instead reaching for success by embracing 
Internet platforms like Kickstarter to get her music heard.
  I am a firm believer that further unleashing Internet technology will 
expand the music marketplace to better reward Internet innovation and 
musical artists.
  The Internet has changed our lives. It is reshaping how people 
communicate, collaborate and engage in commerce. The Internet empowers 
the powerless, it gives everyone a voice, and it advances human rights 
and the cause of freedom around the world. The growth and evolution of 
the Internet comes from good, innovative ideas and from policy 
environments that protect the Net from unfair and discriminatory taxes, 
regulation, and legal liability.
  Unfortunately, one area of the Internet ecosystem that is stifled is 
the digital services of broadcast music. In 1998 Federal laws were 
enacted to specifically thwart the development of Internet platforms 
that are commercially viable as broadcasters of digital music. Since 
then, concerns about online copyright infringement intensified, record 
sales plummeted, and many commercially successful musicians are 
struggling. Consumers and rightsholders are increasingly seeking 
innovative, new models that can better promote music and compensate 
artists. The Internet Radio Fairness Act intends to answer some of 
these calls.
  Under current law royalty rates prescribed for Internet Radio are 
established based on what a panel of special copyright judges determine 
to be the market rate for musical licenses. But there is no functioning 
market for these licenses and these judges are left with very little 
information to make reasonable conclusions. That is why Congress 
routinely intervenes to correct the work of these judges. The current 
method these judges use to establish royalty rates for Internet Radio 
has led to webcasters paying five times the amount of royalties--as a 
percentage of revenue--as other digital music broadcasters, like 
satellite and cable. The long-established method that copyright judges 
use to determine royalty rates for satellite and cable providers 
enables a broader set of factors to be considered.
  The Internet Radio Fairness Act would end the discrimination against 
the Internet and Internet Radio in the digital marketplace. It would 
treat Internet Radio, for purposes of establishing royalty rates, in 
the same way that satellite and cable radio are treated. It would 
enable the copyright judges the ability to consider factors they have 
long been familiar with to establish royalty rates for Internet

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Radio in the same way they have long done for other broadcasters.
  Doing this can enable new Internet Radio startups to succeed and 
create jobs, foster competition, and the expansion of the music 
marketplace in part so that artists can obtain broader exposure and 
more compensation.
  I hope to work with you, with stakeholders, and with my Senate 
colleagues to discuss this legislation and additional ideas that are 
necessary to unleash the power of the Internet to foster a broader, 
more dynamic marketplace for digital music.
                                 ______