Yahoo is plugging its Internet radio service into CBS’s webcasting network in a move driven by dramatically higher fees for airing music online. Yahoo’s retreat from operating a standalone service, announced Wednesday, makes it the second major Web site this year to flee the rising royalty rates by hitching its radio service to CBS.

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The weekend media spotlight was on the heated Congressional negotiations that produced a financial bailout bill, which promptly went nowhere. But hidden somewhere in the static of dealmaking, rhetoric and counteroffers was a strong signal of support for Internet radio. The Webcaster Settlement Act of 2008 passed the House on Saturday and was scheduled for a vote in the Senate on Monday.

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There have been some subtle shifts in digital music this year, trends that will accelerate over the next few months as the holidays near. I’m not talking about MP3 players and the new models to tempt you. Rather, there is an increasing amount of music available that does not require the downloading of songs to a portable device.

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Internet radio station operators are concerned that skyrocketing royalty fees could zap an industry that’s still in its infancy. However, technology may be bringing some solutions to the vexing problem of paying artists a royalty fee each time a listener hears a song.

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The future of Internet radio may be in jeopardy. Pandora — one of the largest online radio services — is on the verge of shutting down, its founders told the Washington Post. The problem? Royalty hikes put in place last year are costing the company most of its income. And it’s not alone.

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