Controversy clouds services

The music executive behind the recently relaunched My Music Anywhere service has urged rights owners not to provide unlicensed cloud services with retrospective licences once they have gained a critical mass.

Catch Media UK chief executive Harry Maloney, whose cloud service launched last summer is now available on iPads and in Best Buy stores, explained in an exclusive Music Week article that there was a distinction between legal services and those that have come into the market and do not pay the creators.

He accepted that there were still many in the music industry that view cloud services with suspicion. But, said there was a distinction between his own and many new entrants, which do not pay creators. Because of this he believed these unlicensed services should not be given the oxygen to grow with the promise of retrospective licences in the future, which could impact on the growth of legal services.

Maloney said, “I feel it to be imperative that copyright owners address the potential proliferation of unlicensed services by refusing to negotiate retrospective licenses once these services have reached a critical mass, having grown by not paying the music makers.”

The full version of Maloney’s article, Music in the Cloud, is below:

Digital music has come of age and is developing at a break neck pace. There are now more than 60 licensed online music services operating in the UK, creating greater consumer demand for access to their media anytime and anywhere.

Cloud services essentially allow music lovers to stream to a wireless device via remote servers – the cloud.

The legal framework of these services is a point of much current debate. At Midem earlier this year Sony’s Thomas Hesse said, “We are very uncomfortable with a model where you can just throw anything into the cloud and stream it, if what you threw into the cloud was not legitimately purchase.”

The conscientious music lover then feels compelled to ask whether accessing music from the cloud is legal. That is, is moving music files from one location to another a breach of copyright law? The argument follows that if a music lover has already acquired music files, what is wrong with being able to listen to those on another device? After all, if I buy a CD, I can play this on my stereo; in the car; or on a portable CD player.

If I stream my music from my own virtual locker that no-one else can access, then in some countries there may be a fair use provision that enables me to do so without requiring an additional licence. However, for the overwhelming majority of services that are launching, the music is streamed from central servers, as part of a service which is paid for by subscriptions or advertising.

There are a number of unlicensed services attempting to enter the market. Such services are paid for by consumers for delivering music and yet not one of the creators gets paid – not the artist, the composer, the lyricist, nor the record producer, music publisher or record company.

As Cloud music services grow there is a real danger that more and more unlicensed services will push the legal boundaries. Knocking at the doors of the UK market, Mp3tunes (currently being sued by EMI) and mSpot are examples of the unsustainable model afflicting this creative industry, a model in which they believe they can collect subscription fees from listeners without passing that on to the artists or their subsidiaries.

There are some online services in the UK that have gone down the painful prolonged road of obtaining licences from all the copyright owners. These include Spotify and We7, which both provide ad supplemented streaming music services free of charge or with added perks for a fee.

The first true cloud service in the UK, My Music Anywhere, launched with Carphone Warehouse and now Best Buy UK, and it is expected to be followed by Google’s cloud service later this year.

I feel it to be imperative that copyright owners address the potential proliferation of unlicensed services by refusing to negotiate retrospective licenses once these services have reached a critical mass, having grown by not paying the music makers. In an industry undeniably ravaged by unscrupulous profiteering, at some point a stand must be taken.

Source: Music Week