Cedergren’s story is the nightmare scenario painted by many Internet radio companies who have claimed that the royalty hike would kill online broadcasting in its cradle. In fact, Internet radio is far from dead. Online broadcasters like Pandora and Live365 still serve millions of listeners. But the higher rates have driven away many small online broadcasters who say they can’t afford to stay in business. And even industry leader Pandora says it’s in trouble. “We’re at the very end of our tether,” founder Tim Westergren said. “There’s a very good chance that we will shut down.”
Critics of the royalty system say the result is decreasing musical diversity on the Internet. They warn of an online music industry dominated by the same giant media companies that presently dominate traditional radio broadcasting. And they point to CBS Broadcasting Inc.’s recent takeover of the Internet radio operations of Time Warner Inc.’s AOL as a harbinger of an Internet radio market rendered bland and predictable.
“They’ll push all of us out of business,” said Johnie Floater, general manager of media for Live365. “Your Internet radio is going to sound like your AM and FM.”
This week, the no-longer cult classic achieved loftier status. Its most popular cover version, released by the late Jeff Buckley in 1994, zoomed to number one on the iTunes download chart, thanks to that ultimate signifier of 21st-century ubiquity, a performance by an “American Idol” competitor. At the same time, Leonard Cohen, the song’s enigmatic 73-year-old composer, was inducted into the Rock and Roll Hall of Fame, serenaded with a version of the song by popular Irish balladeer Damien Rice.
“This is a watershed moment,” said Michael Barthel, a Syracuse University graduate student who last year presented an academic paper on the song’s staying power. “Every generation discovers ‘Hallelujah,’ and right now, a whole new generation of people is discovering it.”