With the Feb. 15 deadline to reach a compromise on webcasting royalty rates approaching, SoundExchange has made a new settlement offer to small webcasters, Billboard.biz has learned.

Under the terms of the deal, different rates are being offered to different webcasters, depending how much revenue the company makes and how much traffic it receives, according to documents obtained by Billboard.

The deal takes a tiered approach to both the minimum per-channel fees and the royalty rates owed for music played on Internet radio. The smallest group of webcasters are defined in the agreement as "microcasters" -- those who make less than $5,000 a year, with expenses of less than $10,000 a year, and with less than 18,067 total aggregate tuning hours.

This group would pay only an annual minimum payment of $500, plus a $100 "proxy fee" in lieu of providing reporting data on which songs they play to cover SoundExchange's costs of administering the payments without such data.

Webcasters with gross revenues less than $50,000 a year are offered a $2,000 minimum payment per year, while those with gross revenues of more than $50,000 would pay $5,000 as a minimum payment. Webcasters with annual transmissions totaling less than 5 million aggregate tuning hours a month would pay either 10% of their first $250,000 in gross revenues and 12% of any revenues over that, or 7% of all expenses for the year -- whichever is greater.

Webcasters with transmissions that exceed 5 million aggregate tuning hours a month, or with annual revenues of more than $1.25 million a year, would no longer be considered a small webcaster and as such would have to pay the statutory commercial webcasting rates.

What's more, the deal is being offered through 2015, and retroactive from 2006. That would resolve both the dispute over the current rate structure handed down by the Copyright Royalty Board in March of 2007, as well as avoid renegotiating those rates for the next rate period, which begins in 2011. Webcasters agreeing to the deal would not be able to participate in any proceedings to determine rates for the next rate period or petition Congress to overturn the existing CRB decision.

The offer resembles that made in 2007 to small webcasters, which was based on the small webcaster settlement act of 2002. While SoundExchange says more than 40 small webcasters accepted the deal, many others didn't because the terms applied only to music by SoundExchange members. Although SoundExchange represents about 95% of music copyright owners, webcasters who refused the plan were concerned that it didn't cover the remaining 5%.

This new deal is being offered under last year's Webcaster Settlement Act, which makes it binding on all copyright owners.

A SoundExchange spokesperson confirmed the offer, saying, "SoundExchange is firing on all cylinders trying to get as much accomplished by the Feb. 15 deadline."

But representatives from the webcasting community are less enthused with the offer. Several pointed out that under the deal, smaller webcasters who sell their company to a larger one that does not qualify for the discounted rates would suddenly owe the full statutory rate retroactively to 2006. The buying company would have to pay those rates, which would represent a serious obstacle to any potential acquisition.

Also singled out for scorn is the 5 million cap on aggregate tuning hours a month. Several small webcasters who meet the $1.25 million revenue exemption find themselves awfully close to that traffic limit, which would make them ineligible for the deal. They would prefer a limit of closer to 10 million aggregate tuning hours a month, or none at all.

"We're disappointed with the offer," says Rusty Hodge, founder of SomaFM. "It effectively is worse that the previous [one]. Basically SoundExchange has done nothing to comprise with webcasters at all."