On Tuesday, Microsoft, Yahoo, and Real were named in a lawsuit filed by some music publishing companies claiming that each of their online music stores – Zune, Yahoo Music, and Rhapsody – infringe upon their copyrights. If you’re shaking your head and wondering how that is possible, with all the royalties they pay out, you’re not alone.
This copyright business is a real mess. As consumers we know not to illegally download music or share it online, or we could potentially face crazy fines from the RIAA, such as the $1.92 million one recently handed down to Minnesota mom who downloaded 24 songs. For websites and companies looking to distribute or allow the playing of music on their sites, it’s far more complicated than that and the stakes are incredibly higher. In fact the copyright laws as related to music are so complicated that even places we consider to be legitimate sources are being slapped with lawsuits alledging infringements.
In the case of this latest lawsuit, the publishers claim that all three companies may have licensed the copyrights on the recordings, but didn’t license the copyright on the compositions. There are a whole lot of details out yet explaining the legalities and issues at hand in the case, but it is assumed these music services struck deals with record labels, but somehow the publishers and labels are separate entities and the rights are separate.
In many cases we assume that the publishing rights were also covered by the major record labels. But in some cases the publishing rights were owned by independent companies, and the claim looks to be that the publishing rights were never cleared with them.
What this means is that Microsoft, Yahoo and Real were all streaming music that they only had partial rights too. And since the publishers consider each instance a song is played to be an infringement… yikes! They could be looking at some pretty hefty fines if the court agrees.
If you’re interested in reading the entire court filing, which I will warn you is a massive 104 pages long, here you go. Have at it. In the meantime, we’ll definitely be following this closely. Any ruling in favor of the music publishers could potentially have major ramifications for all three companies. I imagine that Google right now is pretty darn happy that they’ve stayed out the music game, and that their search engine competitors are being tested.