A New York appeals court has ruled in favor of Yahoo this weekend, claiming its Launchcast Internet radio service is not required to pay royalties to copyright holders for songs it plays. The losing party was Sony BMG Music.
The claim by Yahoo was that Launchcast did not give users enough controls to be considered “an interactive service,” which would require the royalty fees to be paid.
The judges added that Yahoo would only have to pay licensing fees to SoundExchange, the nonprofit organization that collects royalties for musicians.
“It’s an immediate loss for the recording industry,” notes Rey Sanchez, chairman of the department of music, media and industry at the University of Miami and a voting member of the National Academy of Recording Arts and Sciences, via Reuters.
“If the service had been deemed interactive, Yahoo would have to negotiate fees with every record label to use their songs. Instead, it only has to pay licensing fees.”
Sony declined comment while Yahoo said nothing more than that they were pleased with the “fair” ruling.
Result for: royalty fees
Teosto (Finnish Composers’ Copyright Society) has officially requested that USB drives and mobile phones with MP3 playback function should join the products — such as DVDs and DVRs — with a recording/storage device royalty fee. Teosto has been fighting for the right to add the fees to mobile phones for two years now and now they want both external hard drives and thumb drives included as well. The proposal will now travel to Ministry of Education where the final decision is made.
Teosto has claimed that extensive amounts of copyrighted recordings are copied to both USB drives and mobile phones each year and therefore the composers have a right for a proper compensation. The fees would increase mobile phone prices up to 12,60 euros (approx. $16) for music phones such as the Nokia’s new touch-screen XpressMusic 5800 and presumably Apple iPhone.
Last year the same happened to HD DVD and Blu-ray discs that carry nowadays a fee of up to 1,89 euros per disc.
The proposed royalties for the year 2009 are as follows.
Mobile phones with MP3 playback:
1,4 euros for up to 512MB of internal memory
2,45 euros more than 512MB but up to 1GB of internal memory
3,45 euros more than 1GB but up to 20GB of internal memory
4,15 euros more than 20GB internal memory
Mobile phones that are advertised as music phones (eg. Nokia XpressMusic series, Sony Ericsson Walkman series):
2,4 euros for up to 512MB of internal memory
7,35 euros more than 512MB but up to 1GB of internal memory
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Result for: royalty fees
On Monday we reported that Apple was threatening to close down iTunes if the Copyright Royalty Board voted to raise digital music distribution royalty fees.
It appears however that fans of the iTunes store need not worry as the vote has come through and the rates will remain unchanged, at least for the near future.
The rate hike talk will be re-voted on in 2012, but for the time being everyone seems happy with the decision including the record labels and the Digital Media Association, the group of which most online music retailers including Apple and Amazon are a part of.
Jonathan Potter, the Association’s executive director, added “that the decision to keep the rates at the same level will significantly help digital services and retailers in their quests to innovate and grow over the next several years.”
