AOL, RealNetworks and Yahoo Get $100 Million Bill
A Federal Court found today that AOL, Real Networks and Yahoo owe $100million to songwriters and composers as back payment for streaming music online.
The court ruled on a request from the American Society of Composers, Authors and Publishers to establish reasonable compensation for the playing of their works. Notably ASCAP represents writers and composers and not the record industry, so the request for money is on top of any existing licensing agreements with the RIAA and its constituent members.
The court found that “reasonable license fees” are owing from AOL, RealNetworks, and Yahoo for the music streamed and distributed from their sites, retrospective to 2002, at a cost ASCAP counts at $100 million.
Unsurprisingly, ASCAP was happy with the decision:
“The Court’s finding represents a major step toward proper valuation of the music contributions of songwriters, composers and publishers to these types of online businesses - many of which have built much of their success on the foundation of the creative works of others,” said ASCAP President and Chairman and Academy Award-winning lyricist, Marilyn Bergman. “It is critical that these organizations share a reasonable portion of their sizable revenues with those of us whose content attracts audiences and, ultimately, helps to make their businesses viable. This decision will go a long way toward protecting the ability of songwriters and composers to be compensated fairly as the use of musical works online continues to grow.”
The Digital Media Association, a trade organization representing online streaming and music providers, said that the are not opposed to compensating composers and writers, but object to the model imposed by the court, with demands companies hand over 2.5% in part of all revenue as compensation, not just revenue from the music services themselves.
(in part via CNet)
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Yahoo To Shut Premium Music Service, Redirect Users To Rhapsody…For Now
Yahoo will shut its premium music service tomorrow, a move away from premium music sales we first reported on in September 2007, and instead redirect users to Real Networks’ Rhapsody service. Terms of the deal are not yet available.
According to an AP report, subscribers to Yahoo Music Unlimited will be shifted to the Rhapsody service in the first half of this year with Yahoo subscribers’ music library and payment plans remaining the same for only a limited time after the switch. Yahoo Music Unlimited plans came in at between $5.99/ month and $8.99 /month, compared to Rhapsody’s $12.99/ month charge.
The move alone is part of the further consolidation in the online music marketplace as more companies abandon standalone efforts in favor of partnerships as Apple’s iTunes continues to dominate the online music marketplace. The move itself may be short term with Yahoo users likely to be forwarded to the Zune marketplace if Microsoft’s acquisition of Yahoo is successful.
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Real’s Rhapsody On TiVo: Will It Be Blue?
RealNetworks’ Rhapsody music service will become available to TiVo’s 10-12 million United States users, under a new deal to be announced today.
Real’s Rhapsody will allow TiVo users to sign up for the $13 per month service and listen to the more than 3.5 million songs from their TiVo DVR streamed on demand.
TiVo has previously inked content distribution deals with Amazon’s Unbox and Podshow.
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