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It's pretty clear in the article
A new twist on file sharing is holding out the promise of allowing millions of people to share their song collections online, at no cost--and without legal risk.

Broadcasting fees are set by the U.S. Copyright Office rather than by the record labels and are relatively cheap--they come to about 1/7th of a penny per listener, or about $1,429 per million people. As a result, Mercora says it can afford to pay the fee on behalf of the broadcasters on its network, with the cost offset through advertising sales.

So from what the article say is that that the songs are paid for by advertising. Just like normal radio except this allows you to surf broadcasting playlists from anyone using the system. You won't have the instanteous ability to download a particular song but you can find when a song will be playing and record it.
Posted by: voska   Posted on: 11/08/04 You are currently: a Guest | Members login | Terms of Use

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Sounds just like Napster was  voska | 11/08/04
Not exactly  AbsolutelyNot | 11/08/04
It's pretty clear in the article  voska | 11/08/04
Page 2  AbsolutelyNot | 11/08/04
I've heard this before  Spoon Jabber | 11/08/04
The essential difference is . . .  James Dean_z | 11/08/04
Safeguards?  John L. Ries | 11/08/04
live365.com broadcasts with MP3 format ...  George Mitchell | 11/08/04
Interesting Idea But......  Robertbrice | 11/09/04
If you never hear music, do you buy?  Joepfrensen | 11/17/04
Here is more quality, free and legal music!  witnesstwo | 11/20/04

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