Online music radio stations may soon be in deep trouble due to a ruling by the Copyright Royalty Board. The ruling [PDF] means that the rates that most webcasters pay to license sound recordings will more than double over the next several years.
Most nonsubscription, noninteractive webcasters pay a royalty rate set by the government in order to license sound recordings (typically from record labels). This statutory license was setup by Congress in 1995 to ensure that online radio would not be left to the impossible task of clearing every song one at a time with each rights holder (traditional terrestrial radio broadcasters pay nothing for using sound recordings, but pay songwriters through three collecting societies: ASCAP, BMI, and SESAC).
Small and nonprofit webcasters have argued that the new rates are essentially unaffordable for them, potentially forcing them to give up webcasting altogether. Pandora, NPR, and the Corporation for Public Broadcasting are already planning legal challenges.
Webcasters and fans all over the Net have been in an uproar about this ruling, and there are plenty of great places for you to learn more and take action. Doc Searls has published an excellent round-up here, the Radio and Internet Newsletter (RAIN) explains the rate's implications here, and the Broadcast Law Blog provides some insight on how the rate was reached.