NAACP Opposes Effort to Change Online Royalties

The Internet Radio Fairness Act, a federal bill supported by Pandora, Clear Channel and others that would change the way online radio royalties are set, has come under new opposition from the N.A.A.C.P., which said in a letter to members of Congress that the bill would “unfairly deprive artists and performers of fair pay for their hard work.”

The bill, introduced in September, would direct a panel of federal judges to use the same standard in setting royalty rates for Internet radio that they use for satellite and cable radio services, a change that Pandora and others believe would substantially lower their rates.

It already has been opposed by music industry groups, as well as by the A.F.L.-C.I.O. But the N.A.A.C.P. letter, dated last Friday and publicized by a music industry coalition on Thursday, adds new pressure, portraying the issue not just as a business dispute, but as a civil rights matter.

“Quite frankly , the I.R.F.A. bill fails the basic test of economic fairness and discriminates against singers and musicians by slashing the compensation they receive when their work is played over digital online radio,” says the letter, which was signed by Hilary O. Shelton, director of the N.A.A.C.P.'s Washington bureau.

Members of the Internet Radio Fairness Coalition, which in addition to Pandora and Clear Channel includes the Digital Media Association and the Consumer Electronics Association, argue that the current royalty system is unfair and impedes the development of the industry.

Pandora, for example, has paid a much higher portion of its revenue in royalties than satellite and cable radio services. The new bill would make a number of other alterations to the rate-setting procedure, including a change in the way the copyright royalty judges are appointed.

This week, Pandora also started a new front in its campaign to lower royalties when it sued Ascap, a perfor ming rights group that represents songwriters and publishers.

A spokeswoman for Pandora did not immediately respond to a request for comment on Thursday afternoon.

Ben Sisario writes about the music industry. Follow @sisario on Twitter.