Small Web radio sites get fee break

WASHINGTON, May 23 (UPI) -- The U.S. organization that collects online royalties for the music industry has agreed to let small Internet radio stations pay a reduced fee.

SoundExchange -- a non-profit performance-rights organization that collects royalties on the behalf of sound-recording copyright owners and composers -- said webcasters making less than $1.2 million a year would pay 10 percent of all gross revenue, up to $250,000, and 12 percent of all gross revenue above that amount.

The discounted rates, retroactive to Jan. 1, 2006, would remain in effect through 2010, said SoundExchange, spun off from the Recording Industry Association of America trade group in 2000.

"There's a sense in the music community and in Congress that small webcasters need more time to develop their businesses," Executive Director John Simson said in a statement.

"We look at it as artists and labels doing their part to help small operators get a stronger foothold."

The organization said its rate cut was "a direct response" to a letter it received from U.S. Reps. Howard Berman, D-Calif., and Howard Coble, R-N.C., urging SoundExchange to "initiate good faith private negotiations with small commercial and noncommercial webcasters with the shared goal of ensuring their continued operations and viability."