encoded in each sound recording, pay the royalty fees, and comply with the associated terms and
with any recordkeeping requirements promulgated by the Copyright Office.^3133
The statute distinguishes between two types of subscription digital audio transmissions:
(1) a “preexisting subscription service,” which is a non-interactive subscription service
performing audio-only digital audio transmissions that was in existence and was making such
transmissions to the public for a fee on or before July 31, 1998;^3134 and (2) a “new subscription
service,” which is a non-interactive subscription service performing digital audio transmissions
and that is not a preexisting subscription service or a “preexisting satellite digital audio radio
service” (defined in the third bullet below).^3135
Eligible Nonsubscription Transmissions (Webcasting): by means of an “eligible
nonsubscription transmission,” which is defined as “a noninteractive nonsubscription digital
audio transmission not exempt under subsection (d)(1) that is made as part of a service that
provides audio programming consisting, in whole or in part, of performances of sound
recordings, including retransmissions of broadcast transmissions, if the primary purpose of the
service is to provide to the public such audio or other entertainment programming, and the
primary purpose of the service is not to sell, advertise, or promote particular products or services
other than sound recordings, live concerts, or other music-related events.”^3136 The conditions for
the statutory license for eligible nonsubscription transmissions are very similar to those of
nonexempt digital subscription transmissions noted above.
Preexisting Satellite Digital Audio Radio Services: by means of a “preexisting satellite
digital audio radio service” (not exempt under Section 114(d)(1)), which is defined as “a
subscription satellite digital audio radio service provided pursuant to a satellite digital audio
radio service license issued by the Federal Communications Commission on or before July 31,
1998, and any renewal of such license to the extent of the scope of the original license, and may
include a limited number of sample channels representative of the subscription service that are
made available on a nonsubscription basis in order to promote the subscription service.”^3137 To
be eligible for the statutory license, the service must not exceed the sound recording performance
complement and must not publish in advance a schedule of the programming to be
performed.^3138
Pursuant to its statutory authority, the Copyright Office conducted a number of Copyright
Arbitration Royalty Panel (CARP) proceedings^3139 to establish the royalty rates to be paid for the
(^3133) 17 U.S.C. §§ 114(d)(2)(A)-(C) & 114(f)(2)-(4).
(^3134) Id. § 114(j)(11).
(^3135) Id. § 114(j)(8).
(^3136) Id. § 114(j)(6).
(^3137) Id. § 114(j)(10).
(^3138) Id. § 114(d)(2)(B).
(^3139) The Copyright Royalty Tribunal Reform Act of 1993, Pub. L 103-198, 107 Stat. 2304, eliminated the Copyright
Royalty Tribunal (CRT) and replaced it with a system of ad hoc Copyright Arbitration Royalty Panels (CARPs)
administered by the Librarian of Congress and the Copyright Office. The CARPs adjust royalty rates and