LOS ANGELES – The U.S. recording industry has brought a multi-billion-dollar lawsuit against XM Satellite Radio in the States.
Numerous reports in the States followed up on the original in Billboard Radio Monitor which said the Recording Industry Association of America (RIAA) brought the suit in response to XM’s Inno device, which is part satellite receiver, part digital recorder. The MP3 recording capabilities steps around copyright and is an unlicensed digital download service, says the recording industry,
"Here they go again," said Consumer Electronics Association vice-president of government affairs Michael Petricone. "The record industry is returning to the courts in their non-stop efforts to stop new technology, neuter existing products, frustrate consumers and make illegal long-standing consumer home recording activities. Their new target is XM Satellite Radio, one of America’s top technology success stories of the new millennium. XM’s only offense is providing legal and exciting programming options to millions of Americans, while opening new revenue and promotional opportunities for the recording industry.
"The lawsuit announced yesterday is a brazen effort by the labels to strong-arm more money from a successful technology industry startup," added Petricone. "XM Radio already is the largest single payer of digital music broadcast royalties. More, the record labels receive royalties on every XM recording device sold as provided by Congress under the Audio Home Recording Act (AHRA)."
The lawsuit, say the reports, asks for US$150,000 per downloaded song from XM.
“These are legal devices that allow consumers to listen to and record radio just as the law has allowed for decades," said XM in a response to Billboard Radio Monitor. "The music labels are trying to stifle innovation, limit consumer choice and roll back consumers’ rights to record content for their personal use. This is a negotiating tactic on the part of the industry to gain an advantage in our private business discussions. XM Radio is the largest single payer of digital music broadcast royalties, and royalties paid by XM go to the music industry and benefit artists directly. XM will vigorously defend this lawsuit on behalf of consumers.”
In response to the XM response, the RIAA said to BRM: “Not only are we fans of satellite radio, we consider ourselves partners and we celebrate the industry’s growth. From the outset, we understood the mutual benefits of digital broadcasts. In fact, we provided them with a major price break in our initial licensing agreement to help the industry get off the ground. That agreement has made it possible for satellite radio to grow.
“As we continue to transform our business model, the integrity of the digital marketplace is more important than ever. We want to work with our various partners to offer fans an extraordinary music experience in a variety of different ways, but everyone must play by the same set of rules and fairly compensate labels, artists, songwriters and publishers. The labels ask the court for a declaration that XM has willfully infringed their copyrights and for an award of damages in an unspecified amount."
As for XM Canada, there’s a different set of rules, company president Stephen Tapp told cartt.ca in an e-mail.
"Under Canada’s unique system for setting copyright fees, royalties from satellite radio will be set by the copyright tribunal when all sides have provided input," said Tapp. "Accordingly, it will likely be several years before a determination is reached on copyright fees for new technologies with recording capabilities. However, XM Canada already pays five per cent of our revenue to Canadian talent development, and we are on track to be the biggest funding source for Canadian musicians by our fifth year."
– Greg O’Brien
