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"The reality is that songwriters have been ignored—or taken for granted—in the debate over distributing music on the Internet."
——NMPA attorney Carey Ramos
STREAM TEAMS TO SQUARE OFF
ON CAPITOL HILL
Performance Or Reproduction?
That Is The Question.
Record labels and publishers are about to lock horns over a critical concern—how pubs should be compensated for streaming audio—as Duet and MusicNet gear up for launch.

Tomorrow (5/17), the House Subcommittee on Courts, the Internet and Intellectual Property will conduct a hearing on the issue, with scheduled speakers including Lyle Lovett and representatives of the National Music Publishers Association, debating with spokesmen Rob Glaser of RealNetworks and MP3.com’s Robin Richards, along with Vivendi Universal bigwig Edgar Bronfman Jr. Bronfman’s Universal Music Group has been specifically targeted by the NMPA for the recently terminated sub service it tested on Farmclub.com. UMG contends that these streams were covered by existing licenses from publishers.

At issue in this debate, which has been raging for months, is the specific nature of streaming audio. The labels insist that streams are performances and should be licensed accordingly, while the pubberies contend that streams are reproductions, which call for a higher royalty rate than performances. The pubs’ claims would seem to be based on a technicality: Before an audio track can be streamed, it goes through a buffering process, during which a temporary copy is made of the digital information. Labels and webcasters (for whom the resolution of this issue is a matter of life and death) argue that this process simply allows a performance to take place.

A precedent may have been set in the settlement of a lawsuit initiated by publishers against MP3.com. The netco agreed to pay 10 cents per track loaded into its My.MP3.com database and a cent per stream. But pubs and songwriters don’t see it that way.

"The reality is that songwriters have been ignored—or taken for granted—in the debate over distributing music on the Internet," publishers’ attorney Carey Ramos, told Reuters.

"Some Internet companies and record labels want the music publishers to let them use their music for free—or else have the government step in to force the publishers to do so. That is self-serving and, some might say, hypocritical—but not fair," Ramos said.

The labels have called on the U.S. Copyright Office to set streaming rates.

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