Arbitron Throws the Book at CARP

If one of the top-rated radio stations in New York rebroadcast its programming online and had the same audience on the Internet as it does over the air, that station would pay approximately $15 million per year in digital rights fees. Thus, the digital rights fees would be over 25% of what that station currently derives from selling traditional over-the-air advertising revenue (approx. $56 million per year). If that online station had original programming on the Internet (versus a rebroadcast), its digital rights fees would be approximately $30 million, or over half of the revenue a top-ranked music station in New York derives from its over-the-air advertising revenue.

Furthermore, the retroactive nature of the fees and the excessive data and reporting requirements set forth by CARP add overwhelming start-up and ongoing operational costs.

...we believe there should not be any digital rights fees implemented or, at a minimum, there should be a five-year moratorium on digital rights fees for streaming media. In addition, the retroactive aspect of the current proposal should be eliminated. Little would be lost by giving the industry the breathing room it needs to grow since streaming media has not yet generated significant revenues and since the streaming of music on the Internet does not pose a threat to retail music sales. Furthermore, a moratorium would enable the popular but fledgling streaming media industry to grow. Most importantly, the public interest will be better served by assuring the broad distribution of programming needed to stimulate competition, foster innovation and promote diversity.