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Sony labels file royalty payment lawsuit against Radionomy

radionomy logo august 2014 canvasSony music labels have filed a lawsuit in a California federal court. The suit complains that Radionomy has not paid appropriate licensing royalties for use of music recordings since late 2014.

The filing notes communication with Radionomy as recent as early this year, in which: “Defendants acknowledged that they are not currently in compliance with U.S. copyright law, including the payment of the statutory license royalty payments for reproduction or public performance of sound recordings in the U.S., and admitted that they had not paid royalties to SoundExchange since 2014. They further admitted that they do not require their users to comply with the performance complement set forth in Section 114.”

Three labels are participating in the filing: Sony Music Entertainment, LaFace Records, and Arista Records.

RAIN News heard anecdotally that Radionomy’s Internet radio platform, which hosts online stations created by individuals, small businesses, and broadcasters, went dark yesterday evening for several hours, roughly synchronized with news of the lawsuit reaching the Internet. We heard from the same unverified sources that Radionomy offered an explanation to its producers of a power failure.

The Radionomy Group is a holding company for related webcasting businesses. The legacy platform hosts station-building tools for ambitious Internet radio producers. Radionomy also owns ShoutCast, which is home to about 55,000 pureplay stations, many of them semi-professional ventures operated by music lovers in a particular genre category. All these stations produce a large amount of streaming audio ad inventory, which is represented by TargetSpot — also part of the Radionomy Group.

Although Radionomy is HQ’d in Belgium, the lawsuit is set within the governing context of the U.S. Copyright Act, and the American statutory license available to webcasters, which is administered by SoundExchange on behalf of record labels.

The recent ruling of the Copyright Royalty Board (CRB), which raised webcast royalty rates for 2016, and which also marked the expiration of a law which offered a lower royalty calculation to “small” webcasters falling under a revenue threshhold, does not seem to directly apply here. The case is explicitly about back royalties during 2015. (For more CRB background, see our extensive coverage here.)

 

Brad Hill

40 Comments

  1. It’s a headache not just for Radionomy, but also for Vivendi, which owns Universal Music, and has a 64% stake in Radionomy’s ownership. Should be interesting what Universal will make of the filing too, given that its catalogue is just as likely to be streamed through Radionomy.

    • In terms of Universal, I think we’re going to be seeing the inevitable: the big record companies turning on each other to duke it out for the big monopoly.

      • Like this station’s blog wonders, could this really be a dispute between record-company giants? birchstreetradio.com/2016_03_01_archive.html

        • Agreed. Also, here’s the specific link: birchstreetradio.com/2016/03/were-trying-to-keep-independent.html

  2. This is a station I listen to based in Ireland. (heartbeatfm.net)

    They stream on Shoutcast, in addition to some other internet portals. (heartbeatfm.net/listen-live/)

    Because they are an Irish station, how will this affect them?

  3. A small correction – Sony alleges they owe royalties, but not that they have not paid SoundExchange since 2014. They had been in talks with SoundExchange, but nothing had come of it, since they’re based in Belgium and not the United States.

  4. So while it’s true that they haven’t paid SoundExchange since 2014, SoundExchange is not party to this law suit, and they have NEVER paid SoundExchange.

  5. As I remarked yesterday in the comments of the RAIN – New Radionomy App article, I do wish that “the press” would dig their claws into this issue further.

    I get the sticky international cob webs and hoodwinks of the situation. But I’m desperately thirsty for some clear cut answers and/or comments from the US PROs regarding their present AND historical relationship with Radionomy.

    Just from reading their fairly well hidden TOS years ago, it was quite evident to me that their “escape clause” to any foreign (US) PRO that should come knocking was to seek relief under whatever international safe harbor provision available.

    As for their clients/broadcasters, well despite their website sales pitch to “any and all” the fine print clearly leaves them in the cold without a coat. Though it’s doubtful that any US PRO will go after any individual broadcaster.

    It’s a gooey thicket folks. And being as this particular case is so incestuous and whored up, it’s probably no surprise it’s taken this long to get some real answers from either side. Hello depositions!

    • American media is too obsessed with Donald Trump at the moment. Ugh!

  6. Here’s the deal:

    Radionomy hosts channels and inserts adverts to pay for revenue and follow licenses. But not all of those 50,000 channels are hosted by Radionomy, but are individuals or other agencies who may not care about licenses being able to appear in the Radionomy search. And that’s when the problem comes in so kill the search provider.

    Hollywood isn’t happy that they index channels that don’t pay licenses but are listed in the search… And instead of going after those channel providers individually, they are going after the main service.

  7. This lawsuit attempts (successfully, based upon comments I’ve seen, both here and on other blogs) to conflate Vivendi’s hosted channels with the entirety of their Shoutcast channel listings. The vast majority of Shoutcast channels accessible through their protocol are hosted by users, not by any Vivendi machine.

    The only “service” they could honestly be said to offer are those stations which Vivendi hosts on their own servers, which are subject to copyright flags & are frequently pulled from their hosting service if violation is detected.

    Most of the search results are actually user’s own stations, hosted on user’s own machines, the content of which cannot (nor should be) controlled by Vivendi.

    This goes beyond content blocking & attempts to require that search providers somehow filter every listing based upon the content provided, something they have no practical method of knowing. They would have to monitor the audio output of every Shoutcast station in their listings (an enormous quantity of frequently untagged audio data), analyze it & compare to a (non-existent) database of all copyrighted audio.

    Listing does not equal hosting & their actual hosted channels *are* susceptible to DMCA. This lawsuit is an attack on the right to promote public communication.

    • Sorry Billy but you’re swinging way outside the batter’s box here. The offending stations are all hosted and presumably “licenced” by Radionomy.

    • Billy Bob said, “This lawsuit attempts (successfully, based upon comments I’ve seen, both here and on other blogs) to conflate Vivendi’s hosted channels with the entirety of their Shoutcast channel listings.”

      Wrong. This is not about the entirety of their shoutCAST directory. This lawsuit solely concerns Radionomy’s hosted and “licensed” stations—not their directory (shoutcast) listing service.

      According to the filing, Radionomy (hosted stations) has no licensing arrangements with US PROs either privately or under the blanket statutory license provision of U.S.C. Section 114. I have all the court docs in front of me as I am listening to one of the Radionomy hosted stations named in the suit. And yep…coming in loud and clear from a “Vivendi” server.

      That’s the deal Billy.

      • Their Twitter page mentions Live365, which was abandoned by investors as the expiration date for “reasonable” royalties (Webcaster Settlement Act of 2009) loomed (shut-down/lay-off 2016 January 31) … perhaps Vivendi (and Union Square Ventures) hope to negotiate a sustainable deal, or lobby Congress to resurrect?

      • By using Radionomy do they take ownership over all content streamed using their service? If so then I can understand them needing to acquire licenses otherwise surely it remains the responsibility of the station to acquire licenses and is nothing to do with Radionomy?

        • yes, they are responsible for all content streamed over the service. Many of the stations on Radionomy are just collections of music uploaded and being played on shuffle from Radionomy’s service.

    • One of the best comments in this thread. I listen to a lot of online radio stations, they are hosted in every corner of the globe.

  8. Radionomy hosts stations and pays all rights for them. The stations are not liable for any good-faith lapses in licensing. (In other words, they’re not responsible for performance rights — Radionomy pays that — but the songs they play have to have been legally acquired.) Further info here: netradioblog.blogspot.com/2016/03/the-war-on-american-internet-radio.html

    • As that blog says, it definitely sounds similar to when Sony removed small stations from Tunein. See here: forum.streamlicensing.com/index.php?topic=312.0

    • The operative phrase needed here is “supposed to” pay all rights for them. Apparently, they haven’t been.

      • Conspiracy theorist in me agrees that the timing of this is suspicious. See here for more info: birchstreetradio.com/2016_03_01_archive.html

        • Agreed. Also, here’s the specific link: birchstreetradio.com/2016/03/were-trying-to-keep-independent.html

    • This is yet another case of Big Music trying to kill the burgeoning small-webcaster industry.

      • Exactly! See here: djgarybaldy.co.uk/facilitating-diy-pirate-internet-radio-stations/

  9. People also don’t realise that this issue is an immediate danger to the US specifically. The corporations, with American courts as their hired help, are attempting to eliminate Net radio from the United States, and to date they’ve been entirely successful. Radionomy is the last refuge of small webcasters there. When it gets forced out of the American market, there will literally be no further growth in Net radio in the US. The rest of the world will march on into the future — many countries are already decades ahead of the US, which was already incredibly backward in that technology before the CRB effectively made webcasting start-ups illegal in January — and Americans… simply won’t. This is a big deal, folks. Check it out: netradioblog.blogspot.com/2015/12/rebuffering-kissing-american-dreams.html

  10. I think the take away here is “create”.

    When you put the hands in users to create their own stuff taking you out of the picture., you just know it will end badly….. always… and most of the time it does..

    Ironically, they can’t guarantee cover.

  11. Here’s some clarifications since so many people are getting confused.

    Radionomy is made up of multiple parts:
    1. Their Hosting Service
    2. Radio Index
    3. TargetSpot (the ad network/technology)
    4. Former Nullsoft\AOL products (Winamp\Shoutcast)

    The lawsuit here is only about #1 and that they:
    1. Haven’t paid royalties since 2014 that their contract states they will and you don’t have to.
    2. Shut down stations that don’t reach 130h (and those don’t get ad revenue, only either the filler time and no ads or the same 5 or so PSAs every ad break)

    The radio index is like TuneIn, iTunes, etc. and lists both Radionomy stations and others.

    TargetSpot is not really an issue (other than the 2nd point above). Heck even some real local stations use them for their online stream ads and aren’t having issues.

    Lastly, Shoutcast has nothing to do with this as Radionomy stations are IceCast actually and this has been an issue for a while before they even bought it. Same with Winamp.

  12. From what I’ve heard lately, Sony Music is having a temper tantrum in their lawsuit with Radionomy. They sent a letter to TuneIn ordering them to remove all Radionomy stations from TuneIn.

  13. From what I’ve heard lately, Radionomy doesn’t even have an office in California. So whoever Sony have sent it to, I doubt if any lawsuit has been received.

    I guess companies around the world will not be playing the US Corporates’ game and, as a result, many will also be boycotting Sony, which is chiefly their loss.

    It’s just a real crying shame for US broadcasters & listeners that they’ve had these draconian laws imposed on them.

    If TTIP is ever ratified, there will be mass riots across Europe.

    Land of the free? Don’t kid yourselves 🙁

  14. What if, say, Radionomy decides to demand that TuneIn removes all SHOUTcast and Icecast stations from their listings, because they (or their employers, in the case of Icecast) own the software which generates the stations, and they will write it into the License and ToS? WIll there be any stations left on TuneIn?

  15. Or maybe Radionomy doesn’t need to demand anything? The devs can just code the auto-disabling of TuneIn into the SHOUTcast and Icecast software. They could even force players and encoders to refuse to play and skip over any Sony music. I’m sure it’s pretty simple code 😉

    • They could make two or three exceptions for the good stuff, but let’s face it, the majority of music on Sony is a load of rubbish anyway.

  16. Restore all Radionomy stations and apps, or completely remove all 100k+ Radionomy, SHOUTcast & Icecast stations from your listings, as you no longer have permission to host them.

  17. mmmm, geo-blocking. It’ll be SC & IC stations next, but from the other end. Then if the good people of the USA want to be able to hear the same great music the rest of the world is hearing, they will need to demand their government does something to undo the draconian CRB ruling.

  18. So ask yourselves this Sony… what’s better… to get some royalties from a few thousand Radionomy stations at the old rates, or no royalties at all from those stations? Or, depending on the first answer, maybe even to get royalties from 100k+ stations, or absolutely no royalties at all?

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