The Library of Congress Copyright Royalty Board has released its decision to substantially raise royalty rates paid by Internet Radio providers. If upheld, the judgment will have devastating consequences. In many cases these new royalty rates would approximate 130% of gross revenues to companies like Pandora, Live 365, Sirius, XM Radio and BlueBeat.com. The fatal effects to this nascent industry will damage even the largest of players such as iTunes and Yahoo.
In recent hearings, SoundExchange has cited stream ripping as a primary reason for the rate increase, arguing lessened CD and legal download sales. While it is true that stream ripping jeopardizes the entire music industry, increasing royalty rates will only discourage lawful webcasting while strengthening the illegal base of stream ripping software.
Proven technology exists which eradicates this epidemic and is far more profitable for the music industry than rate increases. Media Rights Technologies (MRT) has spent four years perfecting an effective solution to stream ripping that is simple and elegant to deploy. MRT's SeCure X1 technology protects all Internet streams from piracy without affecting the consumer experience. X1 has been vetted and presented to Congress by the RIAA, however the trade association has been remiss in their failure to adopt it.
Over 100 million stream ripping programs now in the public domain continue to cost the labels billions of dollars in lost annual revenues, while for a fraction of that amount a proven solution could be implemented. Since 2003, MRT has consistently demonstrated the efficacy of X1 at http://www.bluebeat.com/, which has eliminated stream ripping of its globally webcasted content.
MRT CEO Hank Risan adds, "Solving the stream ripping problem by increasing royalty rates makes no sense. A reasonable and nondiscriminatory solution has been made available to the recording industry for many years. It's time for the music community to realize revenue and stop passing the buck."