It is rumored that the service is being forced into early retirement because of new royalty rates that digital radio producers now need to adhere to. Late in 2015, the Copyright Royalty Board handed down its decision about what internet radio services will need to pay per stream, and it apparently hurt Live365 so much that it can no longer afford for the rights to play music. Companies like Pandora lobbied hard for the court to lower royalty rates for the next five years, and while certain kinds of streams will cost internet radio stations and services less, it will cost platforms more overall to continue to play music. This may not be the only reason why Live365 is going out of business, but it appears to have been a factor.
Live365 launched in the summer of 1999 and was immediately a success. Nothing quite like it had ever been tried online on such a scale, and people around the world reacted positively. The company allowed the average, everyday music fan to become a DJ, turning everyone into a potential influencer.
In the decade and a half since, a lot has changed in the digital radio sphere, but the idea behind Live365 has remained incredibly important. People want a place where they can not only look to others for suggestions and guidance on what they should listen to, but where they can lead. Live365 allowed for anybody to showcase their tastes and their musical discoveries, which is a trend that continues to this day.
The service’s legacy is evident more now than ever. Live365 can be thought of as one of the first true streaming services, which have now all but taken over the music industry. While Live365’s popularity might not have remained steady, the idea of internet radio certainly didn’t disappear, and now platforms like Pandora and iHeartRadio boast user bases that are approaching the 100 million mark.
In an email to all of its over 5,000 unique broadcasters, representatives for Live365 said that those at the company were sad to be closing it down, but that this might not be the end, adding in that “there are always possibilities that we can come back in one form or another.”