Yahoo slaps down Sony, Motown over net radio

Appeals ruling allows Launchcast to keep paying lower royalties

Music player

The music-industry luminaries at Motown, Capitol, Virgin and Sony BMG are likely crying into their lattes this morning after the latest body blow to a business seemingly determined to stand Canute-like against the rising tide of the internet.

A US federal appeals court in New York City has ruled that Yahoo's Launchcast online music service does not have to pay the record companies higher royalties every time it plays their songs.

Not interactive

Where Yahoo maintained the service was not interactive and, therefore, had to pay only the same fees that apply to radio stations, the firms contesting the original 2007 verdict said it was customisable and should be liable to pay a lot more.

The court ruling, however, sided with Yahoo: "The user has control over the genre of songs to be played for 5,000 songs but this degree of control is no different from a traditional radio listener expressing a preference for a country music station over a classic rock station."

Via Reuters