National Public Radio is challenging the Copyright Royalty Board's (CRB) decision setting webcasting rates, which the group says is damaging NPR's commitment to music discovery and education. NPR filed a motion late today (March 19) with the CRB asking for a rehearing.

The CRB on March 2 set the 2006-2010 compulsory-license royalty rates that
webcasters and simulcasters must pay to perform sound recordings on noninteractive Web sites (section 114 of the Copyright Act).

NPR and other noncommercial webcasters must pay an annual fee of $500 per
channel or station. If that webcaster exceeds 159,140 aggregated tuning hours (ATH) of music streams in any month, which is equivalent to an average of 218 simultaneous streaming listeners per hour, then the station must pay commercial rates for those additional streams. Commercial rates begin at .08
cents per stream in 2006, increasing to .19 cents per stream in 2010.

The CRB set this ATH threshold based on a survey of the average number of
simultaneous streaming listeners at NPR stations in 2004. Any streaming beyond that threshold would be considered competing with commercial webcasters, the Copyright Royalty Judges wrote.

NPR's rates before the decision are confidential; the rates were negotiated
with the RIAA in 2002-2003. While not disclosing the rates, NPR's VP communications, Andi Sporkin, claims that the new rates are at least 20
times more than the amounts stations were paying in the past.

In a motion filed today (March 19) for all stations funded by the Corporation of Public Broadcasting, NPR asks the CRB to withdraw or modify its ATH threshold and its requirement that NPR pay commercial per-stream rates above that threshold. NPR also asks the CRB, "at a minimum," to stop enforcement of its decision in connection with these issues until NPR has gone through the full appellate process.

"The new rates inexplicably break with the longstanding tradition of recognizing public radio's non-commercial, non-profit role, while the procedures we're being asked to now undertake for measurement are non-existent, arbitrary and costly," Sporkin says in a statement.

In the motion, NPR argues that the annual $500 fee per station or channel is
too high. It also claims that treating NPR stations no differently than commercial webcasters when the former reach a "point of convergence" with
commercial services is extremely prejudicial.

Other parties may also be filing motions for a rehearing, which are due today.

Within 60 days after the CRB makes a ruling on the parties' motions asking
for a rehearing, the Register of Copyrights must publish the decision in the
Federal Register. During that 60-day period, the Register reviews the decision for any material legal errors in connection with copyright law. If the Register concludes there was such an error, the Register issues a written decision correcting the error, which is made part of the public record and published in the Federal Register.

Also, any of the 25 parties to the CRB proceeding may appeal the decision to
the federal District Court in Washington, D.C. The parties include SoundExchange, the Digital Media Assn. (DiMA), and groups representing small
webcasters and college stations. The parties have until 30 days after publication of the decision in the Federal Register to appeal the decision.