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RAIN 4/26: SoundExchange requests to use "proxy info" to distribute unclaimed royalties

Posted on: 04/26/2011


SoundExchange has reportedly requested that it be authorized to use “proxy information” to distribute 2004-2009 royalty funds for which it has little or no useful play data that would indicate who to pay. SoundExchange made the request to the Copyright Royalty Board, which is seeking comments on the proposal.

With a proxy system, SoundExchange would make educated guesses as to what music a particular service played, based on known play data from other, similar services, according to reporting by David Oxenford in BroadcastLawBlog.com. SoundExchange would then distribute accumulated royalties, which are now at about $28 million, to copyright owners and performers which it feels likely deserve them. (Last year around this time, SoundExchange reportedly had over $200 million yet to be paid out, see RAIN here.)

Oxenford suggests software- or hardware-based monitoring systems will likely be the key to making sure deserving parties are paid for the use of their music going forward. “Automating such systems, making them ubiquitous, foolproof, easy to use and inexpensive, should be the priority of SoundExchange and webcasters and other music services, so that those who deserve to get paid are paid,” he writes.

Public comments on SoundExchange’s proposal are due May 19. Read more from Oxenford in BroadcastLawBlog here.


Though SoundExchange and royalties were a topic of discussion at RAIN Summit West’s legal panel, more time this year was spent discussing new issues like cloud services and privacy.

Angus MacDonald, General Counsel of Live365, said Amazon’s new Cloud Player music service is a “perfect storm” of legal issues. Though “there is some legal cover” for Amazon’s position that its service is the equivalent of an external hard drive, the labels may argue that every time a song is streamed from the cloud, it’s a performance. Plus, said MacDonald, there’s the question of if the user’s content was even obtained legally.

Brian Gantman from EMF/KLOVE tackled Pandora’s privacy subpoena, explaining that the service “isn’t in trouble,” but there is an investigation into how mobile apps are using consumers’ information. The big question is if any new rules will hamper the ability to present targeted ads. “That is something, while I think Pandora will find good ways around it, that adds another layer of difficulty“ to monetizing Internet radio, said Gantman (more on recent privacy issues here).

Royalties, as ever, did come up. Rhapsody’s Senior Counsel of Legal and Business Affairs David Rosenberg gave some insight into the service’s new plan to “talk to the labels to give us a better rate so as to use radio as a conversion mechanism to upsell our subscriptions, which will in turn generate higher revenues for artists and our company” (RAIN coverage here).

Greg Riggle from SESAC was on-hand to offer a sneak-peek into a new program he’s heading to partner with small broadcasters and webcasters. “Healthy music presenters are good for our business,” he said, and hopes the new deals will help webcasters and broadcasters present more music. He said to expect some announcements this summer.

David Oxenford, a partner with Davis Wright Tremaine, frequent RAIN source and a long-time veteran of RAIN Summits, again proved an excellent and entertaining moderator. Thank you to David and all the panelists.


The NAB Show will launch an “official online extension“ of the recent convention in Las Vegas called “Virtual View.”

Virtual View “attendees” will be able to see “video showcases” from participating companies, download white papers and brochures, join live video chats with industry experts, and acces on-demand sessions of the most popular breakout sessions from the NAB Show. Virtual View will be available May 12th. There’s more info here.


After releasing an Android remote control app for Squeezebox wireless music systems, Logitech has now launched a version for iPhones, iPod Touches and iPads. The free app turns your iOS device into a touchscreen remote control, including support for Squeezebox’s Internet radio apps. Find out more from Logitech’s blog here.


If you’re in the market for a tabletop Internet radio but aren’t interested in refinancing your house to get one, the iLuv INT170 Wi-Fi Internet Radio System might be a good option. The device streams 15,000 web radio stations and includes dual-set alarms. Amazon has it listed for $60 here and GadgetReview.com has more info here.

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