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New Net radio fee collections delayed

Webcasters will have two extra months--until July 15--to prepare to hand over steeper royalty fees. Some are vowing to get Congress involved.

The U.S. Copyright Royalty Board has pushed back the date on which a contentious fee hike for Internet radio broadcasters takes effect.

In a 32-page final rule (PDF) formally published Monday, the three-judge panel within the Library of Congress set July 15 as the date that the new royalty rates required of Net radio operators will kick in--two months later than the original deadline.

After more than a year of vetting outside submissions, the judges issued an initial ruling on March 2, drawing widespread outcry from large and small commercial Webcasters and the public radio community.

The board prescribed rate hikes of .08 cents per song per listener retroactive to 2006 and then 30 percent each year until 2010, when they would climb to .19 cents per song per listener. It also said each station would have to hand over a minimum $500 royalty payment.

SoundExchange, the non-profit entity that collects the fees and supported the hikes, has said the CRB's changes are necessary to compensate artists adequately.

A group called SaveNetRadio, whose members include Internet radio listeners, Webcasters and artists, says the decision will cripple the Internet radio medium if left untouched. It is supporting a new House of Representatives bill that would invalidate the board's decision in favor of setting a level rate for all digital music services, including satellite, cable and Internet radio and Internet-based jukeboxes.

The group said in a statement Tuesday that it would spend the next 45 days lobbying Congress to enact that bill. "We feel strongly that Congress could not possibly have intended a structure whereby Internet radio services pay 60% to 300% of their revenue in royalties," the group wrote.

The courts may also have a say in the debate, as the formal publication of the CRB decision in the Federal Register opened a 30-day period for notices of appeal. An National Public Radio representative said late Monday that the organization still intends to take such a step.