Former RIAA chief advising Project Playlist

SAN FRANCISCO--Jeremy Riney, CEO and founder of Project Playlist is optimistic he will eventually license music from the big four record companies.

"There is no money in shutting down companies," says Project Playlist CEO Jeremy Riney

(Credit: Greg Sandoval/CNET News.coml)

He continues to harbor these hopes even after three of the four largest music labels filed a copyright lawsuit against his company last month, he said at the MusicTech Summit on Thursday.

What may be helping Riney keep his cool is that he has hired Jay Berman, the former CEO of the Recording Industry Association of America (RIAA) to help shepherd Project Playlist past copyright issues, according to a source close to the company.

Berman is co-founder of Berman Rosen, a consulting firm that he started with Hilary Rosen, another past RIAA chief.

Project Playlist, founded two years ago, aggregates links to music files and then enables users to listen on an embeddable music player that has found a following among MySpace and Facebook users. In the complaint filed on behalf of all the top music labels save for Sony BMG, which is negotiating with Project Playlist, the RIAA alleges that the majority of the links found at the site lead to pirated music.

Riney said that Project Playlist is covered by the Digital Millennium Copyright Act, which protects operators of Internet services from responsibility for illegal acts committed by users. He points out that his company doesn't host any stolen content on its site, nor does it support piracy. Furthermore, Riney said that if he can't license music legally he will shut his site down.

He might take some comfort in knowing that the labels appear to be using litigation as a way to soften up tech companies at the negotiating table.

In two high-profile copyright cases, Warner Music Group sued Imeem and Universal Music Group sued MySpace and both recording companies dropped the suits and licensed their music after receiving equity stakes.

"There is no money in shutting down companies," Riney said. "There is money in licensing companies and licensing opportunities."

Riney says now he must wait to see how the music industry plays its hand. The labels shouldn't wait too long. The advertising-supported Project Playlist, according to Riney, is profitable.

[alexgieg]

From a Slashdot meme:

1) Sue first.
2) "Negotiate"
3) Profit!!!

[londonsoulpatrol]

Its very clear that the best way to establish a new company is to operate unlicensed, build traffic and then 2-3 years down the line either get bought or roll over and give equity rather than being sued. You still end up with some share left of what is then a legit company with licenses, and can cash in down the line. Its a no-brainer.

I work for a web 2.0 music destination that wants to try to do things legit from the start. But the licensing process is so arduous and slow and painful that the odds are stacked against success. All the money we need to pay to rights holders from the get-go, unlicensed companies like playlist can spend on development, marketing, traffic building etc. Its not a fair competition. Definitely smarter to be unlicensed.

[galacticgufus]

basically another sell out to the riaa. thanks for nothing, project playlist. how is your 'service' any different from listening to the wireless?

[benjaminstraight]

benjamin straight writes: Good article.