On December 16, a relatively obscure U.S. administrative body issued rules with broad implications for online music. Every five years, the Copyright Royalty Board, or CRB, determines the rates that non-interactive services like Pandora and iHeartRadio will pay to stream sound recordings online. The details are dizzyingy complex, but this time around the bigger Internet radio companies generally cheered the ruling, while SoundExchange, the organization set up to distribute these royalties to artists and copyright holders, expressed disappointment. One set of stakeholders, though, raised existential alarm about the new terms: small, independent webcasters. […]

Casey Rae, CEO for musicians-advocacy group the Future of Music Coalition, who was among the first to signal concern about the new rates’ lack of a separate category for low-budget players, suggests that one or more of the smaller webcasters might one day grow out of the category and strengthen the webcasting community. U.S. broadcast radio, unlike online radio, still isn’t required to pay these types of royalties, just royalties related to publishers and songwriters—in Rae’s view, the interests of webcasters, artists, and labels are aligned when it comes to closing that exemption.

“We want a decent rate,” Rae says, referring to the royalties for smaller webcasters. “And it is temporary. The goal is to motivate the companies who can have success as standalone webcasters to take advantage of the special rates to grow their business and be good partners to those of us on the creative side. We’re working on getting that message out there and hoping to get people to the table sooner than later.” The end of small, independent online radio stations—and the pioneering Internet culture they represented—appears imminent, but the final notes are still to be played.