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Verstandig Broadcasting perseveres in royalty-exemption case

Inside Radio tells us that Verstandig Broadcasting is pushing back against the recent magistrate recommendation that the case be thrown out. Verstandig is suing SoundExchange, seeking an exemption from paying royalties for recordings used in the online streams of Verstandig stations. the case hinges on an argued loophole in the Copyright Act, which potentially allows a royalty exemption for retransmitted music in a 150-mile radius, representing a typical terrestrial signal reach.

It’s all a bit obscure, but significant. Althhough the case has gone badly for Verstandig up to now, if the radio group achieves some or all of what it wants, the implication for the American radio industry would be huge. With geo-fencing technology now available, limiting the stream’s geographic reach, or tracking plays by geogrphy, potentially lowers an unwanted music licensing cost for thousands of stations.

The magistrate ruling was based on examination of the case of a single Verstandig station. Verstandig now argues that it intends to apoply geo-fencing to at least two additional signal streams. In this argument, Verstandig hopes to keep the case alive, while enlarging its scope and spelling out its implications.

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Brad Hill

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