The Recent Independent Artist Movement and its Impact on Copyright Infringement Claims


The digital domain may not be the Wild West, but it certainly is the latest battlefield that will map out the music landscape for the next millennium. After years of copyright infringement litigation to protect music studios (and their artists) from the likes of Napster® and Grokster®, the studios have now joined forces with formidable digital distribution domains like Apple, Inc.’s iTunes and MP3.com. Even Walmart, which once leveraged its dominant position as the nation’s largest CD retailer, has an online music store devoted to digital downloads.
 
But for all of the hype about protecting artists’ rights, many artists complain that the studios take more than their lion’s share of profits. Indie artists (those who have eschewed record labels or been deemed unworthy by them) are now starting to put music online themselves. Several independent artists have songs on iTunes or give music away for free on social networking sites like myspace.com. Last.fm recently started a program to pay unsigned and independent artists royalties each time their songs are played (streamed) by their users. Admittedly, very few artists, if any, will generate enough money to quit their day jobs, but that has not stopped Merlin, an international music rights organization, from trying to torpedo the deal. 
 
According to Billboard Magazine, Merlin wants to strike a deal directly with Last.fm that will cover all of Merlin’s 12,000 member indie record labels. If enough individual Merlin labels go their own way, it will weaken Merlin’s global negotiating position and any leverage that it may have to increase royalty payments to its members. Thus, Merlin warned its members against dealing directly with Last.fm. At issue is whether Last.fm is infringing on any copyrights. Billboard reports that Last.fm allows users to stream tracks of music on demand that are not properly licensed and wants any licensing agreement to retroactively compensate its past infringement. So in essence, copyright holders must agree to waive any prior infringement claims against Last.fm if it wants a shot at future royalty payments.
 
While there has not been any litigation related to Last.fm’s alleged infringement of copyright, the Warner Music Group recently failed to renew its licensing agreement and pulled its artists’ content from the site.   Warner was the first major label to use the service. However, the music studio wants a bigger taste of the royalty pie. At the same time, Warner and other labels are warning consumers that their days of “illegal” music downloads are limited. The term of course referring to the gratuitous use of music in violation of the owner’s copyright. And for those living in isolation who claim ignorance of U.S. Copyright laws, a visit to the once robust peer-to-peer site www.grokster.com generates the following onscreen admonition:
 
“The United States Supreme Court unanimously confirmed that using this service to trade copyrighted material is illegal. Copying copyrighted motion picture and music files using unauthorized peer-to-peer services is illegal and is prosecuted by copyright owners. There are legal services for downloading music and movies. This service is not one of them. YOUR IP ADDRESS IS 209.234.164.66 AND HAS BEEN LOGGED. Don't think you can't get caught. You are not anonymous.”
 
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