Yahoo won a legal ruling against Sony Corp's BMG Music now that a federal appeals court in New York ruled the popular Internet giant doesn't need to pay additional fees to copyright holders when it plays songs.
Yahoo's Launchcast music service -- which reportedly doesn't offer much interactive control to users -- won't be required to pay extra fees, according to the U.S. Second Circuit Court of Appeals. In May 2007, a jury first said Launchcast isn't officially an interactive service as written out by law, and may continue to pay a statutory licensing fee that excludes broader fees.
Between Nov. 1999 and May 2001, Sony accused Launchcast of being an interactive service that had to acquire different licenses to play copyrighted music.
In a case closely watched by the Recording Industry Association of America (RIAA), it's possible the ruling may set future precedent for online and broadcast radio. Companies such as Pandora have been battling with the recording industry for years over licensing fee issues.
"Indeed, the unique nature of the playlist helps Launch ensure that it does not provide a service so specially created for the user that the user ceases to purchase music," U.S. Circuit Judge Richard Wesley wrote after the ruling was announced. "Launchcast listeners do not even enjoy the limited predictability that once graced the AM airwaves on weekends in America when 'special requests' represented love-struck adolescents' attempts to communicate their feelings to 'that special friend'."
Overall, I think this is just a minor victory for online radio, as the RIAA and other copyright groups will continue to hound Pandora and similar services, attempting to increase royalty rates even further.
