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A level playing field

A recent court decision could be the shot in the arm online radio needs. Tracks hed: A level playing field dek: a recent court decision could be the shot in the arm online radio needs.

I’ve never had much faith in streamed, online radio broadcasts. Despite the great promise inherent in the concept of online radio–mainly, the ability to get access to stations and broadcasts from all over the world–the medium has seemed to have too many built-in flaws.

For one, a lack of sufficient bandwidth has meant that fidelity has ranged from so-so to abysmal. The bandwidth boom is in the process of solving that problem. The stickier wicket is that radio has evolved into an inherently portable entertainment medium ever since the introduction of transistors and the prevalence of car radios. Sure, computers are becoming more portable all the time, but that’s an area in which traditional radios might always have the edge.

At last, though, purveyors of online radio have been given a leg up on their more established competitors. In August, a federal court threw out a challenge from the broadcasting industry against the U.S. Copyright Office, which ruled late last year that radio stations must pay extra royalties to broadcast over the Internet.

U.S. District Judge Berle M. Schiller said that although it might make sense for Congress to treat Internet broadcasts in the same manner as traditional broadcasts, the law does not specifically call for that. He called the ruling of the U.S. Copyright Office rational, maintaining that the courts should defer to it.

The ruling was a hard hit for operators of radio stations, many of whom also operate Web sites that carry the content of their broadcasts in real time. If the court’s ruling stands, traditional broadcast companies will have to pay separate licensing fees to songwriters, music publishers, and record companies–just like their online-only brethren currently have to.

This seems only fair. Under the old rules, traditional broadcasters would have been given free access to a listening audience cultivated and nurtured by Webcasters. That smacks not only of claim-jumping, but also of a scenario that could engender antitrust issues.

I’m not naive enough to portray the court’s ruling as a victory for the little guy. Online radio outlets are owned by the same kinds of monstrous conglomerates as traditional stations are.

But the newer medium is as yet unsullied by the trends that have put traditional radio in a coma: standardization, gentrification, and the near-monopolistic standards that allow a company like Clear Channel Communications to dominate the medium.

In 1996 the Telecommunications Act essentially did away with ownership restrictions on radio–and along with them, things like personality, community service, and other assets that made radio such a magical medium at one time.

Now, just a handful of companies control radio in the 100 largest American markets. Of these, Clear Channel has 1,200 stations, including outlets in 247 of the nation’s 250 largest radio markets.

So far, online radio hasn’t been poisoned by consolidation, but that trend–or one like it–can’t stay away long. Until then, Webcasters need to play to their strengths as their audience grows. Traditional radio will never be unseated as a source for local news and community service, no matter how companies like Clear Channel try to choke the personality out of their local outlets. But by making radio stations pay for the chance to compete with their online adversaries, the latter medium will at least have a fighting chance to establish itself as a viable, perhaps even groundbreaking, means of news and entertainment.

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