Yahoo settles with Sony Music

Yahoo on Monday agreed to a settlement with Sony Music Entertainment as part of a lawsuit filed by the recording industry against the Web portal's online music subsidiary, Launch Media.

The lawsuit, filed in May 2001 by the Recording Industry Association of America (RIAA), alleged that Launch violated copyright laws by giving its Web radio listeners too much control over their song choices. As a penalty, Yahoo will make a onetime payment to Sony for its past use, and the portal will enter into a nonexclusive license to broadcast Sony's songs on its LaunchCast radio service.

Financial terms were not disclosed.

Copyright law prohibits Web radio broadcasters from offering listeners "interactive" services that let them choose the song or artist to broadcast. These types of services require a separate license with the copyright holders, such as the license agreed upon with Sony.

Yahoo acquired Launch in June 2001, in an effort to boost its online entertainment offers. Besides its Web radio service, Launch also streams music videos and provides artist information on its site.

Since the acquisition, Launch has become the centerpiece of Yahoo's music strategy. In June 2002, Yahoo shut down its Yahoo Radio service to focus its efforts more closely on Launch.