Sunnyvale-Based Yahoo, AOL May Shutter Web Radio Services

Sunnyvale, Calif. -- Facing a 38% increase in music royalties at the hands of the Copyright Royalty Board, Sunnyvale-based Yahoo and AOL may shutter their Internet radio services, Bloomberg reported. "If the rates remain as they are, it would be very challenging to sustain a business that is profitable," Lisa Namerow, the managing director of AOL Radio, told Bloomberg. Ian Rogers, the general manager of Yahoo Music, told the new service that his company won't stay in the business if "cost is more than we make long term." Both companies are appealing the royalty rates proposed by music industry organization SoundExchange and approved by the Copyright Royalty Board, though the U.S. Court of Appeals may not rule on the matter until 2009. Since the new rates went into effect, Yahoo and AOL have each stopped promoting their web radio services.
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http://music.yahoo.com/launchcast/setup.asp