Sunday, July 15, 2007

Is this the Beginning of Internet Radio?

There has been a lot of press on the new radio internet tax that is going into effect retroactively to the beginning of last year. Sunday, The Beginning of the End for Internet Radio It is going to have a big impact on radio broadcast on the Internet and may make it difficult to impossible to support a radio internet site on just ad revenue. So over the next few days we should see the second major wave of internet radio stations closings. It is another attempt by the music industry to maintain control of the distribution of music. I think that in the long term this tax could actually be good for Internet radio and have unexpected consequences for the old distribution method. Internet sites can avoid the tax if they negotiate their own agreements with musicians. Until now it was not economical for individual web sites to negotiate directly. The music industry model of distribution is so cost effective and monopolized that without a tax of this nature it would be hard for individual web sites to justify the cost of trying to replace it. Will the old monopoly be replaced with a new monopoly or will the industry splinter? This should be good for musicians as competition heats up for their services.

1 comment:

Anonymous said...

The i-rad stations have to have plans. Not all of them are going to shut down... so when will they show their cards.

I agree with you. The tax will tend to piss people off and make them a) more passionate about their music broadcasts and b) more determined to screw the man!

Viva la revolucion!