Streaming Copyright Costs

I wanted to write a quick blog about the cost for websites to stream live music. Earlier this year, the Copyright Royalty Board (CRB) set the following performance rights license per play rates (also applied retroactively):

- 2006 – $0.0008
- 2007 – $0.0011
- 2008 – $0.0014
- 2009 – $0.0018
- 2010 – $0.0019

So how does this play out for a website. Using an estimation that a website could stream 15 songs in an hour, as of 2008, that would cost $0.02 per hour. A website would need to attract enough advertising to at least cover that $0.02 an hour. But that is just for a site playing one song at a time. When you get into streaming sites personalized to each listener, that is where these fees really start to pile up.

It’s important to note that radio stations do not pay performance rights fees to play songs. So now, website streaming sites such as Pandora are now lobbying congress to “level the playing field” for the different types of media so that competition is fair. For the 3 days following Pandora’s release of their application for the new iPhone, they streamed over 3 million songs. At 2008 rates, that cost them $4,200.

Stay tuned,
Erik
erikrostad.com