We just learned that the major record labels have sued XM radio because its receivers permit consumers to program them to record the songs they want. The labels are claiming that XM is guilty of “massive infringement,” and is seeking $150,000 for every song XM plays – which is about 160,000 each month. The labels claim these recordings are downloads just like iTunes, while XM says that these recordings are permitted under the Audio Home Recording Act, which explicitly gives consumers the right to record off the radio.
Let's be clear – this lawsuit is intended to get XM to increase the licensing fees that it pays to the record companies. Sirius already pays an extra licensing fee for the “right” to sell its similar receiver, and the labels want XM to do the same. The labels also think that satellite companies got a sweet deal with regards to the public performance fees they pay. Who gets caught in the middle of this dispute? Consumers like you and me, who pay for our satellite service and our music.
I just don't buy the download argument. It's not like you can export the music onto your computer or iPod. If you want more songs, you have to erase the old ones. To me, the XM receiver is no different than a TiVo. I could keep 20 of my favorite shows on my TiVo forever if I want – but I don't because I want to TiVo new shows. One person told me that listening to music is different – people listen over and over to songs for a short period, then lose interest (and the urge to purchase). Again, my own experience is different. While I do tend to listen to the new music I buy most often, there are few greater pleasures in life than listening to an old song or CD that brings back a fond memory.
What I find particularly troubling is the fact that the damages for infringement provided in the Copyright Act are so high that should XM lose this case, it will likely be put out of business. And that isn't good for anybody, even the record labels.
Here is our press statement on the lawsuit:
For immediate release
May 16, 2006
Public Knowledge Statement on Record Labels Suit Against XM
Background: We have seen news reports that XM Satellite Radio has been sued by major record labels on the grounds that XM's subscription music service is “massive infringement.” The following is the statement of Gigi B. Sohn, president and co-founder of Public Knowledge:
“Consumers for years have had the legal right to record music for their own use. This lawsuit threatens that right on the grounds that consumers now have advanced technology at their disposal in recording songs. The shame of the legal action, however, is that this is really a dispute between XM and the recording industry over licensing fees. The companies should be left to figure out a solution without interference from the courts or from Congress.”