Wait, you just said that artists must pay a royalty fee when offering MP3 downloads. How is indietorrent.org including MP3s with each FLAC purchase at “no additional cost”?
MP3 royalties only apply when an artist’s sales volume exceeds $100,000 per year. We aren’t sure if Fraunhofer expects us to fork-over that royalty when all of our artists combined exceed $100K in sales, or if the fees are assessed on a per-artist-who-exceeds-$100K basis. Fraunhofer has failed to clarify the matter for us. Hopefully, they’ll get back to us before anyone hits that $100K mark. We’re selling FLAC files, anyway. Per Fraunhofer’s own licensing terms, we owe them nothing; none of the revenue is “related” to MP3 — it’s earned exclusively through FLAC sales. If Fraunhofer demands that we provide them with a list of how many customers bought FLAC files and never downloaded the gratis MP3s, and also a list of how many customers downloaded only the MP3s, we’ll let our lawyers hash-it-out with ’em.
