WEBCASTERS SUE RIAA
File Countersuit
The suit, filed in San Francisco, was a response to a lawsuit the RIAA leveled against Launch (hitsdailydouble.com, 5/25) for allegedly failing to seek proper licenses for its LaunchCast service.
The main issue of the dueling suits is whether webcasters that allow users to personalize their Internet radio services should be allowed to join the rest of the industry in a coming arbitration process that will set licensing fees for commercial music. Recently, the RIAA asked the U.S. Copyright Office to disqualify webcasters that offer personalized radio services from the arbitration process. The arbitration, which was intended to focus on rates for "plain vanilla" Web radio, is scheduled for summer. Recording industry officials claim webcasters are trying to sneak personalized radio into the proceeding.
"This was a defensive reaction to a well-financed industry collectively using a litigation sledgehammer," said Digital Media Association Executive Director Jonathan Potter.
The RIAA, on the other hand, feels it is the webcasters who are being unfair.
"Despite their claims of generosity, these companies are trying to impose a royalty scheme that would force all artists to share less than one dollar per year total for the personalized music these services deliver to an average listener," said Steven Marks, senior VP of business affairs for the RIAA. "This case is about a handful of Internet music companies who are attempting to gain a market advantage over their competitors. This is unfair to the music services that are abiding by the rules laid down by Congress. It's also unfair to the creators of the music, which is the backbone of the webcasters' business."
Potter said the Copyright Office has failed to clearly define what types of Webcaster services are eligible for statutory licenses.
"Our only remaining option," said Potter, "is to ask a court to interpret the Digital Millennium Copyright Act so that media companies, technology developers, and investors can gain needed clarification of the statute."
