I’ve heard that the whole idea of internet radio is under threat. What’s the score?

Radio is just another area where the internet has completely erased the concept of distance. I don’t have to be in Caerphilly to listen to Chris Needs’s mind-boggling late-night chats with the local elderly community on BBC Radio Wales – I can be anywhere in the world, as long as I’ve got an internet connection. Wonderful niche stations such as the London-based Resonance FM can easily be heard in Wyoming as well as Whitechapel. And the level playing field of the web enables amateur DJs, based in their bedroom, to theoretically establish a broader listenership than some established commercial stations. However, once they become successful, the music industry will come knocking.

Because internet radio is based on streaming media (i.e. you don’t download sound files, and thus can’t easily store the shows on your computer or transfer them to CD or an mp3 player) you’d be forgiven for thinking that copyright issues don’t really apply. But you’d be wrong, as reader Martin Blackeby discovered. “It’s pretty easy for anyone who is computer-literate to set up a radio station,” he writes, “using software you can download from websites at shoutcast.com, icecast.com and others. But, if you investigate further, you find out about all the various royalties that are due as soon as you start playing any music.” Many small-time internet broadcasters, of course, don’t bother; while they probably have big dreams as radio DJs, they’re also aware that their activities are insignificant enough for them not to be prosecuted. Meanwhile, those who prefer to play by the book can always set up a station at Live365.com; this involves paying a monthly subscription fee depending on your needs ($44.95 gets you 100 listener slots) which covers all the various royalties that are due to songwriters and performers.

From the beginning of this week, however – and backdated to the beginning of last year – a new charge has been levied by the US Copyright Board, requiring each internet radio channel in the USA to pay a minimum of $500 per year as an additional performance royalty. This charge doesn’t apply to terrestrial broadcasters and is widely seen to be unfair, as it threatens the business models of many existing internet radio stations. Following widespread protests the new charge is “under negotiation”, but Christian Ward at Last.fm, the UK-based social networking site which offers users their own radio station, predicts a long battle between the music business and music enthusiasts across all territories before the issues surrounding internet radio are settled. “Smaller independent labels understand the situation, as do most musicians,” he says, “but some organisations just want to turn the clock back to the 1990s and pretend the internet had never happened.”