Late last week SoundExchange, the recording-industry group that collects royalties from Internet radio stations, agreed to limit one key part of the new fees that threatened to shut down a great many webcasters. But now it seems that SoundExchange's benevolence came at a price: in exchange for reducing fees, the recording industry wants webcasters to prevent listeners from copying the music they get through Internet radio -- despite the fact that such copying may be perfectly legal.
SoundExchange had previously asked radio stations for $500 for each channel of music that they send out to listeners, a fee that would have added up to more than a billion dollars for the industry. On Friday, the royalty group agreed to cap the amount at $50,000 per webcaster. The fee cap all but saved Internet radio from certain death.
As Ars Technica points out, though, SoundExchange says in a press release that it will only extend the deal to webcasters who "work to stop users from engaging in 'stream ripping' -- turning Internet radio performances into a digital music library." (Here's the PDF of the press release.)
Stream ripping refers to the practice of recording songs from an Internet feed. Several programs -- StationRipper, RadioLover, Streamripper, among others -- make this a pretty easy process. Once your record a song from an Internet radio channel, you can play it like any other MP3, in any order you choose, without logging back in to the webcaster's stream. Considering how easy that sounds, some industry observers have speculated that people who were scared off by file sharing may be moving to stream ripping as an alternative source of free music online.
But there isn't much firm data about the practice. The recording industry has trouble estimating how many music files are traded illegally online, but recording a Web radio stream, like recording a show on TiVo, occurs off the network, in the privacy of your own computer. And even if stream ripping is widespread, it's not clear what radio stations can do to stop it. Stream rippers work by capturing the music going straight to your PC's speakers, in much the same way that your TiVo or your VCR copies video as it flies between your cable box and your TV. Copy-protection programs simply can't stop this sort of copying.
And though legal opinion is unsettled on the question, many copyright experts argue that stream ripping, like recording TV shows on your VCR, is legal. All you're doing is "time shifting" -- recording something at Time A to play back (for yourself) at Time B.
Like the music industry, Web radio stations aren't big fans of stream ripping. They'd rather have you come back to their site each time you want to listen to music. But many also stay away from the main methods to combat ripping -- webcasting at a lower bitrate, mixing promos and jingles over the music, crossfading songs so they don't start and end cleanly.
You have to wonder if the recording the industry -- now that it's got webcasters locked in negotiations for their future -- will have any trouble imposing such reduced-quality streams.