Last week, online radio died for small broadcasters in the U.S… Barely anyone noticed, because the recording industry has been inching them closer and closer to that fate for years. It’s a sad thing… not just for for the people devoted to running their own stations, but for the independent artists that they helped introduce to the world too.
Back when Second Shifters first started, we began by doing everything we could to make sure we were staying legal with the way we did our broadcasts. We paid ASCAP and BMI for performance rights, the same way that AM/FM stations do, but then we realized that online stations (unlike regular radio stations) also needed to pay the RIAA, thanks to new laws that treated broadcasting on the internet as if it was giving out free CDs to all the listeners who tuned in. It was extremely costly to handle, and after a lot of debating and a lot of late nights trying to figure out the best thing to do, we decided that joint licensing was the only real option that we had.
With joint licensing, smaller stations could pool their resources and split the costs of royalties between each other. Since most of the licensing was based around how much profit a station made, being a station that wasn’t centered around making money was suddenly a benefit. The minimums for all the licensing agencies together were enough to stop most independent stations from even starting if they were by themselves, but grouped together, the stations could split that $3,000 much more easily. It worked out pretty well.
What we didn’t see coming though, was just how hard the RIAA wanted to fight anything and everything that involved music broadcasting online. Napster had come and gone before we started broadcasting in 2003, but Kazaa and BitTorrent were there to take its place, and the recording industry was out for blood at any mention of the internet.
Even though iTunes and other online music stores did help to calm their rage a bit as they grew, there was still no stopping the rise of free downloads, and that meant a lot of legitimate sites and devoted music fans getting caught in the crossfire.
It didn’t matter that streaming radio wasn’t giving people the ability to download what they played. It didn’t matter that the people who ran those smaller stations were some of the most dedicated fans the music industry could ask for. And it didn’t matter that quite a few of the online radio websites were doing everything they could to give people links to buy songs from the artists they loved. They could play by all the rules, follow all the regulations, and spend their last dimes paying for the royalties to keep going, but those stations were something the RIAA didn’t have full control over, and they didn’t have private deals with them the same way they did with Apple, and with Spotify, and with the select few others that had the resources of millions in venture capital funding to make those behind the scenes deals with the recording industry.
The smaller stations just weren’t worth dealing with for the RIAA, no matter how hard they tried, so the recording industry did what they do best, and they decided to toss them away to join the many artists who had spent their life’s savings trying to get the attention of those larger labels, only to end up either turned away or signed to contracts that took every last penny of the money they made.
One after another after another, every joint licensing program that’s popped up over the years has been forced out of business. It started with SWCast, and then with their end came LoudCity. After LoudCity stopped, StreamLicensing.com came along to try to give those small online stations a home. And then, on June 14th, StreamLicensing.com sent out its goodbye letter, with the only place left to turn to a site that charges so much, very few small webcasters could even afford it, but then with a listener hours cap added on top of that, that won’t let them go over an average of 9 listeners at a time, even on the most expensive plan that they offer.
Year after year, the royalties that the joint licensing programs have had to pay have gone up and up and up, and the costs they’ve had to pass on to the stations that were with them have slowly strangled the life from all but the very last few. It’s one of the reasons that led Second Shifters to stop broadcasting at the end of 2015. Sadly, it looks like the final nails have been driven into the coffin of the ones that were left.
With that end though, maybe it’s a chance for new beginnings too. Keep an eye out for some more announcements that might just be on the way from us.