We are learning more about what is really behind the lawsuit brought by the major labels against XM radio. Here are a few clarifications to what I wrote about last night.
First, contrary to what I stated last night, you can't technically “program” the receiver to record the songs you want. You can only program blocks of recording time on channels you like, and then “disaggregate” them. This disaggregation is what the labels don't want.
According to several sources close to this matter, this case isn't just about a licensing fee dispute over performance fees for the record companies. Instead, they want a new licensing agreement based on a distribution right even though no one would be able to tell what is being recorded much less what should be licensed. As for the Audio Home Recording Act, which they supported (and which gives consumers the right to record off the radio for personal use), the labels no longer think it suits their purposes – meaning they don't make enough money from it.
According to those same sources, XM offered the record companies money just like Sirius. Actually more.
But the record companies decided they didn't want the precedent of accepting a one time per device fee. It is too much like a levy, which they don't like. They justify the difference because Sirius capped the number of devices they would sell in that early model to 150,000 units. The record companies were afraid that the XM deal would establish rules going forward. So they changed their mind. What they are really after is control of the device. Sound familiar? Indeed, that is exactly what they are seeking in the PERFORM Act.
Stay tuned for more about this case. In the meantime, if you want a terrific analysis of the legal complaint against XM, Fred Von Lohmann of EFF has one here.