Record Companies Are Now Suing Mobile Carriers For Royalties
It seems as though record companies have developed a new game plan in order to collect royalties. As we all know, the music industry attempted to sue individual users who illegally downloaded songs. But because of this approach to recover from major fiscal loss has destroyed their public image.
In lieu of lowering the price of albums in order to go up against the free music circulating through the internet, the music industry has turned to collection agencies who are now taking legal action against cellphone companies over royalties from ring tones. They claimed that ring tones counted as public performances so cell phone companies should be obligated to pay performance fees. The courts quickly renounced this claim.
Despite this unsuccessful attempt to collect on royalties, Broadcast Music Inc is now suing T-Mobile over ring back tones, claiming that the mobile carrier is selling them without licensing agreements. Unlike ring tones, which play out loud when someone calls a cellphone, ring back tones play specifically to the person calling. In other words, instead of hearing a cellphone dialing, the caller will hear a song that was chosen by the cell owner.
Music lovers are quick to point out the contradictory nature of this lawsuit. If ringtones that can be heard by anyone around a cellphone that is being called, do not equate to a public performance, it seems absurd to sue the mobile carriers over a ringback tone that can be heard only by the caller. Record companies seem to be grasping at straws as they suffer from huge financial losses.
It does not seem that the idea of lowering the cost of CDs and DVDs has occurred to the record companies. There are still a large number of music lovers out there who would rather collect and own the media, but with prices constantly rising, downloading music for free seems more and more tempting. CDs are generally priced at seventeen dollars.
Specific bands have been skirting the issue of music downloading through unique tactics. Radiohead, an alternative rock band, established a website where fans can download the music for free, or for a donation. Nine Inch Nails’ Trent Reznor has followed suit. With record companies’ unsuccessful lawsuits and declining public image, it seems as though thinking outside of the box and fair pricing may be more effective than bullying money out of mobile carriers and individual users.
Mallory McGuinness-Hickey is employed by debt collection agency Rapid Recovery Solution and writes free lance pieces on financial news.
