Webcasters vs RIAA

The Recording Industry Association of America (RIAA) may spend the rest of its associated life in litigation—as either as the initiator or the recipient of actions intended to determine who can use its products, under which circumstances they can do so, and how much they should pay, assuming they are allowed to use them.

Having recently issued more than 1000 subpoenas to suspected online music pirates, the recording industry trade group received one itself on Wednesday, August 27. A suit filed in federal court in San Francisco by a group of Internet music broadcasters charges the RIAA with operating a monopoly over the recorded music market and seeks an injunction to prevent major record labels collecting royalty payments.

In the suit, the 400-member Webcaster Alliance accuses the RIAA of acting in violation of US antitrust laws by squeezing small operators out of the business through the imposition of what the alliance calls "inflated webcasting royalty rates." The current rate for commercial webcasters is 0.07¢ per song/per listener.

Webcasters are pushing for a revision of that rate, hoping to change it to a flat percentage of any commercial webcaster's total revenue—somewhere between 3% and 5%, according to group president Ann Gabriel. The change would lift a burden from small webcasters with low revenue, allowing them to continue offering music to their listeners. The present rate, with lower-rate exemptions for non-commercial webcasters, was agreed to last year after prolonged negotiation. RIAA officials described the suit as "a publicity stunt with no merit."

In Washington, the RIAA petitioned a federal court here to force Internet service provider Verizon Broadband to reveal the identity of an alleged egregious copyright violator known online as "nycfashiongirl." At the heart of the dispute are approximately 1100 audio recordings on her computer, claimed by the RIAA to have been acquired from, and made available to, other music fans via the Kazaa peer-to-peer network.

The defendant asserts through her attorneys that she loaded the recordings onto her computer from her own CD collection. Her attorneys have asked the court to add her case to one already in process, in which Verizon is defending its right to protect its subscribers' privacy. Civil libertarians are watching the case closely, because it could determine whether some provisions of the Digital Millennium Copyright Act (DMCA) are unconstitutional. The DMCA allows aggrieved copyright holders to obtain subpoenas against suspected violators without a court order.