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.
Kudos to Silicon Alley Insider for answering the question about why Sony BMG was not among the major record labels filing a copyright lawsuit against Project Playlist.
Hilary Lewis at SAI reported that Sony BMG is in negotiations with the music start-up.
On Monday, the Recording Industry Association of America (RIAA) claimed in documents filed in New York that Project Playlist makes it easier for users to find unauthorized reproductions. The company provides an embeddable music player used at MySpace and Facebook and claims not to infringe on intellectual property rights because it doesn't host any music files on its site.
A Sony BMG spokesman declined to comment.
What this indicates is that the top record labels are not always in agreement on how to handle copyright cases.
The recording industry filed a lawsuit on Monday alleging that Project Playlist, a company that provides an embeddable music player used at MySpace and Facebook, has violated its copyright.
According to a copy of the complaint obtained by CNET News.com, the Recording Industry Association of America (RIAA) filed suit on behalf of nine record labels and accuses Project Playlist of making unauthorized reproductions of their music.
"Project Playlist performs and reproduces plaintiffs' valuable works (and induces and enables others to do so) without any authorization whatsoever," the RIAA said in its complaint, "without paying any compensation whatsoever."
"Defendant is well aware that the overwhelming majority of the sound recordings in its index are infringing," the RIAA continued. "The overwhelming majority of the third-party Web sites that host these recordings do so illegally."
In the lawsuit, filed in the U.S. District Court of the Southern district of New York, the RIAA has asked for unspecified damages.
It's unclear why none of the labels belonging to Sony BMG Music Entertainment were named as plaintiffs. The lawsuit said that some of the artists whose music was used without authorization are U2, Eminem, Elton John, The Beatles, Coldplay, and Sheryl Crow.
Representatives from Project Playlist could not be reached. On the company's Web site, Project Playlist said that it is "committed to copyright protection" and does not support illegal copying of music files.
"We make it easy for our users to create a playlist that points to a series of music files hosted on third party Web sites," Project Playlist said on its site. "We do not control those third party Web sites. We do not host music files."
Companies that allegedly facilitate the distribution of pirated content have tried to argue that because they don't host unauthorized files they don't violate copyright. That hasn't stopped the RIAA or the motion-picture industry from filing suit.
The most recent example was TorrentSpy, a popular BitTorrent tracker that closed down last month after fighting a two-year legal battle with the Motion Picture Association of America (MPAA).
The lawsuit against Project Playlist was first reported by Reuters.
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