Record industry eases webcast licensing

The music industry has introduced a new licensing system for webcasts in its continuing battle against online piracy.

In a move to show that the industry is serious about embracing the concept of legitimate online music distribution services, the licensing regime will allow internet service providers (ISPs) and online music sellers to negotiate multi-territory licences for streaming music webcasts under one licence.

Webcasting is already well established in the US, where there are currently 1,250 licensed services. The new agreement is aimed at boosting webcasting in other countries, particularly in Europe.

There are already more than 30 major ISPs providing webcasts in Europe, including AOL, Tiscali and Vitaminic, as well as hundreds of small webcasters.

The International Federation of the Phonographic Industry (IFPI), which represents some 1,500 record producers and distributors in 76 countries, has brokered the deal.

Previously, webcasters had to secure approval from a number of different national collection agencies. These agencies will now license not only the rights to music in their own countries, but those of the other societies signing up to the agreement.

Each collecting society will keep a percentage of the fee charged to cover its operating costs, but the IFPI stressed that all societies are non-profit.

Webcast videos are not covered by the deal.

The new regime will come into force as individual collecting societies sign up. An early signatory is the Finnish society.

The actual cost of each country's licence will remain unchanged in the new arrangement, although they will now be negotiable and payable in one go, said the IFPI.

The growth of file-sharing download sites like Napster has contributed to serious revenue declines for record companies, and the current initiative, while not attacking file-sharing sites per se, is designed to bolster online alternatives.

The idea is that music lovers will be encouraged to listen online, for a moderate fee, rather than downloading.

"Setting up webcasting licences in multiple countries has been an arduous and time-consuming task," said Jay Berman, chairman and chief executive of IFPI.

"It was important for our collecting societies to set up a system that would remove these hurdles."