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Karmazin Skeptic of Quick Performance Royalty Passage

Outgoing CEO says terrestrial radio ‘probably’ should be included in measure to level performance royalties for satellite, Internet radio

Outgoing SiriusXM CEO Mel Karmazin has doubts about the odds for congressional passage of a recently introduced bill supporters say will level the playing field for performance royalties among Internet audio services.

When asked by a Wall Street analyst his view on the Internet Radio Fairness Act, which has supporters like Clear Channel, Pandora, NAB and CEA, Karmazin says the issue won’t be addressed until next year, and “we’ll see” on the likelihood of passage. Saying he’s “skeptical,” about passage, the satellite radio and former terrestrial radio executive also believes it probably should be broadened to include terrestrial radio.

Utah Republican Jason Chaffetz and Colorado Democrat Jared Polis introduced H.R.6480 in the House and Oregon Republican Ron Wyden introduced companion measure S.3609 in the Senate. If passed, the legislation calls for the performance rate-setting Copyright Royalty Board to have one standard for both Internet and satellite radio, and provide for presidential nomination and Senate confirmation for the board’s judges; it would also create a forum for artists and labels to negotiate royalty rates outside the CRB, according to the newly-formed Internet Radio Fairness Coalition.

The record-label backed musicFirst Coalition opposes the measure, favoring an alternative that would include terrestrial radio also.

Switching to Internet audio in the car, Karmazin reiterated that the satcaster “has not seen a business model that works in this IP radio space,” however SiriusXM is doing more telematics by combining its satellite radio features with Internet to provide programming personalization because some subscribers want that. “If they want personalization we will give it to them.”