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Thursday, April 27, 2006

The Season of Bad Laws, Part 3: Banning MP3 Streaming

 Washington Post reports that Senators Feinstein (D-Cal.) and Graham (R-S.C.) have introduced S. 2644, dubbed the PERFORM Act, that is aimed at punishing satellite radio for offering its subscribers devices capable of recording off the air.
 
Buried in the bill, however, is a provision that would effectively require music webcasters to use DRM-laden streaming formats, rather than the MP3 streaming format used by Live365, Shoutcast, and many smaller webcasters (like Santa Monica's KCRW and Seattle's KEXP). The streaming radio stations included in iTunes also rely on MP3 streams (since Apple isn't about to license the Real or Microsoft streaming codecs).
 
Today, webcasters that want to transmit major label music are entitled to do so under a statutory license (administered by SoundExchange) set out in section 114(d) of the Copyright Act. So long as they follow the rules and pay a royalty, webcasters can play whatever music they like, using whatever streaming format they like.
 
Under the current law, webcasters are forbidden from helping their listeners record the webcasts, and are required to use DRM only if the format includes DRM. The statutory license applies so long as:
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