RAIN 4/4: SoundExchange "has everything to lose" in legal battle with SiriusXM, says attorney

Michael Schmitt
April 4, 2012 - 11:10am

Kevin GoldbergIn the upcoming legal battle between SiriusXM and SoundExchange, the satellite radio broadcaster (along with broadcasters and others) has everything to gain, while SoundExchange and the CRB face potentially serious set-backs. So argues Kevin Goldberg, Special Counsel at Fletcher, Heald & Hildreth, in the CommLawBlog.

Last week news broke that SiriusXM had sued SoundExchange and the American Association of Independent Music (A2IM), accusing the record industry organziations of interfering with its efforts to directly license the sound recordings (find RAIN's coverage here).

The eventual outcome of the lawsuit aside, Goldberg (pictured) says SiriusXM "made the right play... litigation is expensive, but not as expensive as the $200 million in royalties that SiriusXM claims to have paid last year," he writes. "Add in the fact that a victory would not only reduce that expense, but also afford SiriusXM more flexibility in future negotiations and the ability to innovate."

Moreover, broadcasters (and, RAIN would add, webcasters) stand to "reap the benefits" of SiriusXM's lawsuit "without any effort." Goldberg echoes Davis Wright Tremaine partner David Oxenford (RAIN coverage here) in reasoning that SiriusXM's direct licensing deals "would provide important concrete data – possibly the only such data – regarding the value of a digitally transmitted sound recording" in future CRB royalty hearings for both SiriusXM and broadcasters.

"This would be especially important if the broadcasters’ own worst case scenario – enactment of the Performance Rights Act – were to occur," writes Goldberg.

The outlook is less rosy for SoundExchange. The royalty collection agency faces, at the very least, a long and expensive legal battle, Goldberg argues. At worst, it could face "possible dismantling... or the imposition of some limiting consent decree... or the forced introduction of a competitor receiving agent."

Quote from Goldberg

The lawsuit may also "be enough to rethink the entire regime" of the Copyright Royalty Board (CRB), writes Goldberg. "From allowing SoundExchange to exist without competition to siding with SoundExchange on virtually every contested fact in the 2007 Webcasting II decision (and many other ratemaking proceedings), the CRB may have created the environment that allowed questionable, if not illegal, activity to flourish."

The constitutionality of the CRB and its appointment process have been repeatedly questioned and challenged in the past (RAIN coverage here, here, here and here).

But who wins or loses this particular lawsuit may be "beside the point," says Goldberg. "The mere initiation of the case may represent an early tremor signaling the onset of a seismic event, an event that would likely, one way or another, fundamentally affect all the players."

You can find Goldberg's extensive analysis and explanation of the SiriusXM lawsuit against SoundExchange and A2IM here.

Paul Maloney
April 4, 2012 - 11:10am

RAIN Summit West 2012We've published the day's full agenda for this year's RAIN Summit West (April 15th in Las Vegas). You can see exactly how we've laid out the day here.

We'll get underway at 9:30 with a panel discussion called "How Many, How Much?," in with the IAB VP of member services Michael Theodore leads an exchange on one of the industry's hottest topics these days, the competing theories and plans for  online audience measurement. Theodore (who's one of the most dynamic and skilled panel moderators we've seen) returns to RAIN Summit to speak with Triton Digital's Rob Favre, Larry Rosin of Edison Research, Doug Sterne from Pandora, and Paul Karsiniski of Arbitron. (Please scroll down for a run-down of the day's other panels.)

David CarsonNext up will be a unique "legal issues" one-on-one, as radio legal expert David Oxenford interviews David Carson (pictured) who's General Counsel of the U.S. Copyright Office. Given the well-publicized music royalty hurdles facing webcasters (and pending CRB determinations for webcasters and satellite radio), plus SiriusXM's lawsuit against SoundExchange (see today's follow-up story), these gentlemen will have a lot of ground to cover.

The first of two research presentations is slated for 10:30. TargetSpot CEO Eyal Goldwerger will brief attendees on Internet radio listening trends. Later, Phillip Beswick of The Media Audit will present "Fast Facts on Internet Radio."

Yesterday (here) we introduced a new RAIN Summit feature, the POV. We'll have three POVs, brief presentations from digital media thought leaders on "Redefining Radio." First up will be Triton Media Group President/CEO Neal Schore at 11:20.

Three RAIN Summit sponsors will make "Pecha Kucha" presentations (if you're not familiar, learn about them here). We'll hear from Radioate Media GM Dave Van Dyke, BRSMedia founder/CEO George Bundy, with StreamOn! CTO Andrew Snook going first.

The centerpiece of the Summit, the keynote address, happens at 11:45. This year we're extremely pleased to welcome ESPN Senior Vice President of Production and Business Divisions Traug Keller (pictured right). Under Keller's leadership, ESPNRadio.com has become the most listened to live stream in network broadcast, reaching more than 3 million listeners a month. Our second keynote takes place later: RAIN Publisher Kurt Hanson's annual "State of the Industry" address.

We'll wrap up by 5:45, and get straight to another of our annual highlights, the RAIN Reader Cocktail Party.

The day's other panel discussions include:

  • 10:45 "Charting Digital Audio Ad Dollars": Strategies and trends for ad-supported Internet radio.
  • 1:00 "Innovating the News/Talk Format Online": A focus on "non-music programming" Internet radio.
  • 1:50 "The Connected Dashboard": A discussion of in-car Internet radio.
  • 2:35 "The Streaming Music Landscape": The various and creative ways music programming is presented online. 
  • 3:30 "It's Who You Know": Social media and marketing for Internet radio.
  • 5:10 "Personalizable Radio": Programming to listeners who have some control.

You can see the full agenda, a complete list of our speakers, moderators, and panelists, learn about those organizations that sponsor the Summit, and in-depth descriptions of each panel and presentation, on the RAIN Summit West page here.

We hope you're planning to join us for what's shaping up to be the finest RAIN Summit event yet.

Michael Schmitt
April 4, 2012 - 11:10am

Rusty Hodge, founder of SomaFMInternet radio station SomaFM "pre-dates iTunes, but has managed to survive for all that time without advertising." So writes The Guardian in its spotlight of the pioneering service, headed by Rusty Hodge (pictured). 

The article covers SomaFM's history, its challenges with a donation-based business model, its royalty trials and looks ahead to the coming opportunities and hurdles for the service. Namely, standing out in an increasingly crowded space and carving out a spot in the car dashboard of tomorrow.

"SomaFM is already a fixture on many desktops and mobile devices," writes The Guardian. "Its listeners... are loyal, discernible and at the cutting edge of digital technology."

You can read The Guardian's article here.

Michael Schmitt
April 4, 2012 - 11:10am

Sonos' CR200 remote controlSonos has announced it will stop selling its CR200 touchscreen remote control on June 1. The company acknowledged that the remote (pictured left) was "nudged into obsolence" by Sonos' smartphone and desktop remote apps.

Both the CR200 and smartphone apps control Sonos' wireless home entertainment system, which can stream content from Pandora, Slacker, Spotify, iHeartRadio, Last.fm, MOG, Rdio, NPR, Rhapsody and many other services.

The move reminds us here at RAIN of a similar decision by Slacker, made in 2009, to shift focus away from hardware to smartphone apps (RAIN coverage here). It's another noteworthy sign of the dominance of mobile devices and app stores.

You can find more coverage of Sonos' news in Engadget here. -- MS