Web radio: reaching an accord

SoundExchange has offered a deal to small web radio stations to keep hefty royalty rates for streaming music online at bay until 2010.

Under the terms of the new offer, small webcasters would have to pay 10 to 12 percent of revenue.

SoundExchange is a music industry group that collects royalties and distributes them to artists and record labels. Under the deal, web radio stations with less than $1.25 million in revenue will only pay royalty fees of 10 or 12 percent of their annual revenue, according to the Globe and Mail.

The deal was struck in response to the record industry's attempt to meet small webcasters halfway, since high royalty rates would likely put many small web stations out of business.

Stations have until September 14th to sign the new offer or face the choice of paying higher royalty rates or ceasing operations altogether.