Net Radio Bill Passes House: Pandora Unboxed?

The House of Representatives has unanimously passed a bill that Web radio stations have painted as life or death for their services.

The Webcaster Settlement Act, which would allow Internet radio stations to negotiate with the music industry for a royalty rate lower than what Congress mandated last year, passed the House by a voice vote on Saturday.

Lower rates are vital to the survival of Internet radio stations, according to Tim Westergren, Pandora's founder, who pleaded with the public on Friday to call their congressional representatives and demand they support the bill. Webasters and the music industry are close to reaching an agreement, but if the legislation fails to pass it could push the discussions back months and deliver a financial death blow to some Webcasters, Westergren said.

According to one Washington lobbyist, the phone calls from the public were one of the factors that helped the legislation pass in the House and now have it headed for a Senate vote within the next two days without any major parties gunning for it.

Two other factors, however, likely played larger roles in getting the bill through the House: the lobbying efforts made by National Public Radio and some 12th-hour deal making to appease traditional radio broadcasters, who were trying to kill the legislation, according to sources.