AOL, RN and Yahoo pay $ 100 million in digital music royalties

On May 1, the US Federal Court ruled that AOL, Real Networks (RN) and Yahoo paid the American Music Publishers and Publishers Association (ASCAP) $ 100 million in digital music royalties. provided on online music services of these firms.

'The verdict is a great victory for American music composers and publishers,' said ASCAP Executive Chairman John LoFrumento.

Under the previous agreement, AOL, Real Networks and Yahoo are allowed to use any music that is owned by ASCAP without limitation on the web. However, the parties did not reach a new agreement when the old agreement expired. The main reason is that ASCAP said that the fee previously agreed was no longer reasonable. The case was brought to court.

'Previously we accepted the old copyright fee because we wanted to encourage the development of this business. So far, this field has matured to pay for another price, ' LoFrumento said.

ASCAP petitioned the court to charge AOL licensing fees, Real Networks, and Yahoo to pay for its three online music streaming services. In that way, the AOL and Yahoo license fees paid to ASCAP in 2006 amounted to $ 7.8 million and $ 7.3 million.

In addition, ASCAP also asked the court to allow the calculation of reverse digital music license fees from 2002 onwards - calculated according to the retroactive law. Thus, the royalties paid by the three firms will surely exceed hundreds of millions of dollars.

Meanwhile, the three firms demanded to break down the calculation depending on the type of service. For example, the copyright fee is equivalent to 2.5% of the revenue with the required music service. 1.7% with online radio service and 0.9% with video music service. If this way, the amount that AOL and Yahoo will pay will be pulled down to $ 872,000 and $ 1.1 million.

However, according to some sources close to the relevant companies, the verdict of the court is still not final, so they will certainly plan to appeal.