Industry Liabilities

There is never a dull moment in the entertainment industry.  Over the past few months, there have been multiple reports of companies in the news for legal issues.  These companies included Groveshark, SiriusXM and Universal Music.  Groveshark was a well-known streaming site, accused of piracy and has been shut down.  Groveshark had a long history of distributing music from major companies without a license.  They had over 2,000 copyrighted sound recordings and damages estimated to over $400 million.  Groveshark has agreed with Sony, Warner and Universal and ceased all operations.  This is an ongoing issue in the industry, labels are having troubles controlling music from being leaked.  I feel that this is a major step to gaining control back, it sends a message to other companies that pirate music.

SiriusXM was in the news back in September for a copyright battle.  The case states that Sirius “violated the Turtles’ pre-1972 master copyrights by playing their music without licensing or paying performance royalties.”  The argument was that the master recording rights did not exist until 1972, so SiriusXM did not feel that they were in the wrong.  It was noted that each state had their own laws on master rights, this case took place in California.  Other companies like Pandora are fighting the same battle with paying master rights, this case is huge for artists and labels going forward.  According to the law, radio companies are not in the wrong,  but the artists should have the right to be compensated for their work.

Universal Music Group was in the news recently for cheating artist and classifying digital downloads as sales rather than licensing.  Licensing gives the artist and even split on their sales, while digital sales only gives the artist 15%.  According to Billboard, Universal came to a settlement of  $11.5 million and an increase of royalties for artists.  Although Universal still claims their innocence, I feel that the situation was handled correctly.  As mentioned earlier, artists are already being underpaid from laws and illegal streaming companies they should at least be able to trust their label.