Opinion ID: 788880
Heading Depth: 3
Heading Rank: 7

Heading: The use of different rates for Simulcasters and Webcasters

Text: 51 Broadcasters finally argue that the Librarian acted in an arbitrary manner by rejecting the portion of the CARP's decision that set different rates for Simulcasters and Webcasters. Broadcasters point to record evidence showing that Yahoo! did not believe it could pass on the rates it had negotiated to its simulcasters. Final Rule, 67 Fed. Reg. at 45,254. They also highlight that the CARP found essentially undisputed testimony that traditional over-the-air radio play has a tremendous promotional impact on phonorecord sales. CARP Report at 74-75. On the basis of such record evidence, they claim that the Librarian was bound to accept the CARP's recommendation to apply lower rates to Simulcasters than Webcasters, and that to reject the CARP's decision on this point was arbitrary. 52 These contentions fail because the Librarian adequately cites and explains record evidence to support his contrary decision. The Librarian rejected the CARP's reasoning, pointing out that the Yahoo! agreement established rates for retransmissions of the same types of radio station signals as those directly streamed by commercial broadcasters such that the burden of proof was put on the Broadcasters to distinguish between the direct transmission of their programs over the Internet and the retransmission of the same programming made by a third-party. Id. at 45,254. Finding that they were unable to offer any compelling evidence on this point, the Librarian concluded that the Panel was unable to distinguish between commercial broadcasters and radio retransmissions, and therefore should have set the same rates for the two. Id. The Librarian plausibly reasoned that the rates should be the same, stating 53 an examination of the record clearly shows that both [Simulcasters' and Webcasters'] business models are fundamentally comparable in at least one all-important way: they simulcast AM/FM programs over the Internet to anyone anywhere in the world who chooses to listen. Even accepting the fact that [Simulcasters] say their fundamental business is to provide programming to their local audiences, the potential for reaching a wider audience cannot be denied. Given that the record indicates that 70% of Yahoo!'s radio retransmissions are to listeners within 150 miles of the originating radio station's transmitter, Yahoo!'s business with respect to radio retransmissions seems to be very similar. 54 Id. Whether correct or not, the Librarian's decision to counter the CARP on this point is plausibly explained in terms of the record before him. 55 Broadcasters nonetheless further argue that the Librarian arbitrarily disregarded their contention that the RIAA-Yahoo! rates were not representative of market prices because Broadcasters never would have agreed to the rates that Yahoo! paid because their purposes for streaming differ from Yahoo!'s purposes. Id. In support of this argument, Broadcasters similarly cite record testimony that Yahoo! feared broadcasters [using its services] would be unwilling to absorb the rates Yahoo! negotiated for streaming AM/FM programming. Id. Contrary to the Broadcasters' assertions, the Librarian did not avoid grappling with this evidence, but plausibly explained that it was not persuasive because, since Yahoo! concluded no agreements with the Broadcasters on this point, no determination could be made as to whether the broadcasters would have accepted the rate and paid it, or rejected it out of hand. Id. at 45,255. We do not examine the correctness of this contention, but simply affirm that the Librarian adequately explained his decision based on record evidence. He acted within his prerogative to find the RIAA's arguments more persuasive than the Broadcasters'. Thus, the Librarian did not act arbitrarily in accepting the Register's decision, in opposition to the CARP's, to set the same rate for Simulcasters and Webcasters.