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Negotiations breakdown over streamed music royalties

updated 09:45 am EDT, Fri August 26, 2005

Online music negotiations


Negotiations between music copyright holders and several prominent online music services for streamed music. The Wall Street Journal reports that an agreement was struck in 2001 where online music services could stream music as part of their subscription-based services pending a final settlement on royalty amounts. "The impasse means copyright holders, such as songwriters and composers, will continue to miss out on royalties for online subscription music services that offer an unlimited number of streamed songs for listening on computers or portable devices."

The report says that while royalty agreements have been worked out for Internet radio and paid downloads (such as those offered by Apple's iTunes, which allow users to keep their music forever), agreements for "unlimited" song downloads are not in place possibly jeopardizing the future of music services such as Napster, RealNetworks' Rhapsody, or Yahoo! service, although that service was not mentioned in the report.

The WSJ said that the association's latest offer, made this month, was 6.9 percent of revenue of subscription services, while copyright holders were seek as much as 14% of revenue. For Internet radio, publishers and songwriters get up to 5.25 percent, while they receive up to 8.5 cents a song for purchased song downloads.


by MacNN Staff

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 industry, digital music/video

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  1. hassanpr

    Fresh-Faced Recruit

    Joined: Aug 2004

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    08/26, 10:21am | report spam | Reply |

    LOL LOL LOL

    Apple was right about those subscription download services. Jobs said they will go out of business now they just may if they cant fix this. Thats why apple stayed out of it.

  1. chas_m

    Fresh-Faced Recruit

    Joined: Aug 2001

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    08/26, 10:57am | report spam | Reply |

    Damn

    That Steve Jobs sure is smart.

  1. jhorvatic

    Fresh-Faced Recruit

    Joined: Apr 2005

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    08/26, 11:00am | report spam | Reply |

    Subscriptions don't make

    Subcriptions don't make any sense anyway. You could listen to the radio for free instead of listening to streamed music which you have to buy again to burn a CD if you want to keep it.

  1. melgross@usa.ne

    Fresh-Faced Recruit

    Joined: May 2005

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    08/26, 11:43am | report spam | Reply |

    probably work it out

    I don't think the music companies will want to shut the services down over this, but they have to come up with something soon.

    What I'm curious about is whether any of this money is being paid into an escro account while the negotiations are going on. That's coming on five years of payments. If it all becomes due at once it could put some of the less well financed services out of business.

  1. olePigeon

    Clinically Insane

    Joined: Dec 1999

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    08/26, 12:18pm | report spam | Reply |

    Will they complete with..

    Will they compete with XM and Serius? (I think there's talks of those two merging anyway.)

    Maybe. Personally, I think XM and Serius will merge and become the next cable company. Everyone buys into it as a commercial free service at however many dollars a month, then slowly all the content gets commercials. Before you know it, you're paying for something that was traditionally free.

    If I'm going to pay for something, I want something to show fo it. I like $.99 a song idea because I bought the song and I have it in my posession. With the subscription c***, you have nothing for all the money you've spent, AND it still costs money to burn the songs you like.

  1. DeepDish

    Forum Regular

    Joined: May 2001

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    08/26, 01:46pm | report spam | Reply |

    CDs should be cheaper

    I like to own my music too. But I would rather own the CD, then rip my own copies.

    But CDs are too expensive. That is why CD sales are down (not to mention a lot of c*** is out there too that is not worth buying at any price)

    I like to rip my own music so I get better quality than what iTunes is selling at.

  1. MacnnGregor

    Fresh-Faced Recruit

    Joined: Apr 2004

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    08/26, 03:59pm | report spam | Reply |

    Streaming vs. Renting

    Is there a difference? I think this has always been the logistical problem with the subscription systems. Streaming is like ondemand Radio over the internet. Renting is like, well, renting. iTunes is buying - much more straightforward.

    I always wondered how royalties were distributed between all of those artists in a streaming model and why the record companies prefer it to buying - beyond the loss of control that happens when you actually buy a song....they can't raise the price on you later.

  1. rugmunchingmacattack

    Fresh-Faced Recruit

    Joined: Feb 2006

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    02/25, 08:41pm | report spam | Reply |

    Streaming or Hard Copy

    Well for me, they are all too expensive! Especially if the label is an RIAA member. But given the option I'll take "Hard Copy CD", as long as they're an indie band or label.

    Reason? Quite simple I hate being perceived as a criminal as DRM assumes you are when you buy anything containing this c***. If it's not DRM free it's not for me, and that includes everything Apple and iTunes have to offer.

    Besides, assumming we still have "Fair Use Rights" (and with some of these Corporate Oinks, that's questionable), I have been stream ripping songs from internet radio just like the old days of FM. But better yet are the new offerings of sites like:

    http://www.pandora.com/radio/mgp.do

    http://www.last.fm/

    These both are new and offer an incredible service of quality streamed music you control. Pandora is even featured on Squeezebox and has built-in links to both iTunes and Amazon to buy the songs you listen to.

    That last feature I'm not interested in, but the musical exposure it provides is quite unique and awesome. You can have as many as 100 custom stations and you set them up to play only songs you like. If you like a song you give it a thumbs up, don't then thumbs down. Even skip songs you don't like.

    These people have been analizing music for 6 years and have a computerized program that cuts to the chase of the music style you love. Although the radio stream is just newly offered.

    Bad part is the music is so very good you'll find yourself glued to listening for days. Very, very addictive, but sweet stuff all the same. I look for the indie bands offered up and hit their web site where I can purchase albums direct so more money goes to the ones who deserve it.

    You see the way I see the RIAA Oinks is as new age, rights prostituted carpet beggers. Of course seeing this as so, it is only logical to see their artists as the prostitutes they are. They sell out on their own God Gifted Talent to creeps in suits who have never even heard their music.

    Of course there are other legal options in sites like:

    http://www.allofmp3.com

    Paying a dollar a song at iTunes for a song you only sort of own and kind of use is preposterous. Buy an album's worth of songs and you've paid enough to buy a hard copy CD. Why would anyone do this when at "All of MP3" legally only charges an average of 15 cents per song. RIAA can't touch them or you as Russian Law has a loophole that legally permits this.

    But I still would rather make sure worthy artists get my money than have pork bellied Corporate Criminals (RIAA Member Labels or Russian Criminals) stuffing their faces and pockets, prostituted from over marketed, under talented bands and artists.

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