Universal's MP3.com Clone Loses in Court

erc writes: "According to this article, Universal Music Group's Farmclub.com online music service streamed songs without obtaining licenses from music publishers. According to the Court, Universal must obtain separate licenses for songs it wants to distribute over the net. Turn about, fair play!" Well, the courts are fairly consistent - if you don't have licenses from everyone and their brother, you can't play music online.

Comments

On MP3 streaming...

[bacchusrx]

MP3 streaming isn't so controversial, really. In fact, it's not very difficult--nor very expensive--to get the appropriate licenses to broadcast music (legally) on the Internet.

The problem lies in the fine line between distribution and broadcast. When you distribute an MP3 online, you run the risk of violating the distributor's copyright to the actual CD medium. So, if that MP3 happens to be of a song by Metallica, and you don't have permission from the recording company, or its agent, you've violated copyright law for duplicating the CD (or a portion of it).

On the other hand, when you stream an MP3 online, you're broadcasting it. Broadcast isn't distribution, it's public performance. Public performance rights belong to the songwriters. If you broadcast that Metallica MP3 without permission from artist, or from one of the appropriate songwriter's associations, you've violated copyright law.

Thankfully, getting permission from the songwriter's associations--that's ASCAP, BMI and SESAC--is a piece of cake. The licensing rate depends on a number of factors -- available here, here and here -- but for the most part, for small internet broadcasters the fees are minimal. ASCAP charges about $250 a year to start... BMI is more expensive, SESAC is considerably less (something like $50 or $75 annually.)

The United States has additional rules for online broadcasters that don't apply to airwave broadcasters. For instance, you can't provide music on-demand... you can't announce your playlist in advance... and you can't play too many songs from the same artist/album in a row. Nor can your playlist repeat predictably or too frequently.

Other countries have less restrictive rules.

Where things get messy is where you start to provide audio on-demand, or whenever audio is made available for download. In those cases, distribution rights apply as well as (or instead of) public performance rights...

BRx.

Re:What is the big deal?

[Bobo the Space Chimp]

Nonsense.

Building a massive distribution network like the major labels have done is not a trivial task. It adds tremendous value to a musician's earnings.

Do some musicians, after they get started, suddenly feel ripped off? Sure, and some go their own way, and frequently earn less money. Some do start up their own companies for just these reasons. The Beatles did. Ever hear of United Artists? Same thing, but by actors for movies.

This is just socialist nonsense that the massive means of distribution, created by very hard work by the record companies, should be used by musicians at the whim of and under terms of the musician.

Re:openAudio

[monkeydo]

You clearly don't know what "public domain" means. Quite a bit of classical music is in the public domain. Your orchestra friend can play this music in a public performance and not pay licensing fees to anyone (since there isn't anyone to pay fees to) however, if your orchestra friend records her performance and makes a CD of it, your dance instructor friend would have to pay a royalty if she wanted to dance to it in public.

The licenses for public performance are in fact based on audience size and particualr use, if you get permission in advance it can actually be quite cheap. It is only if you are caught not paying that they try to ream you. Even restaurants and stores are supposed to be paying these fees, that's why services like DMX, Musak, etc are popular with these groups, the licensing fees for public performance are built in.

That's nothing to labels...

[Chris Johnson]

Good god, no. The unsigned bands don't get anything. Farmclub has one of the nastiest, most evil artist contracts in the business for 'unsigned internet bands'. Far from expecting a piece of the pie, they are legally required to not _suggest_ that their being on Farmclub means Farmclub _endorses_ them in any way. Yes, there is (last I read it) specific language in the contract forbidding the bands from even boasting about having a page on Farmclub if that implies that Farmclub _endorses_ them in some way...

But if you really want to make your band's lawyer shit a brick, show them the 60 page contract you have to sign if you are asked to perform on the TV show they have. I know of at least one act who refused an appearance on the show after seeing the contract. Naturally, there were lots of people who'd sign anything to get on TV, to replace them...

If you're really a friend of your friends on Farmclub, either persuade them to get off it immediately and consult a lawyer about their position, or at least convince them to run the agreements by their lawyer- ESPECIALLY if they 'get' to be on the TV program, the bait for most of the acts on Farmclub. You could call that show the parade of the damned- a revue of artists and bands who are already so contractually fucked that they will never have a career in the music business, even before they've sold a record.