While music streaming is becoming a hot topic, there is still a high demand and following in SiriusXM. However, SiriusXM currently settled a small copyright fiasco that is going to set them back $210 million. The dilemma may also prove a problem for music streaming companies in the future.
Before 1972, songs didn't really have a form of copyright attached to them. Once the popularity of radio took off, and people began using music in films, TV shows and for commercials, it was apparent that copyright would need to be applied to songs as well. States have granted copyright to these songs but not everyone was following the rules and playing fair.
This takes us to documents filed this week with the SEC against SiriusXM for playing those pre-'72 songs without paying out royalties or buying licenses. Instead of fighting through the courts on who's right and who's wrong, SiriusXM recognized the issue at hand and has agreed to pay out $210 million to record labels, settling the dispute.
Major record labels currently own the rights to about 80 percent of the pre-1972 music SiriusXM plays, so the settlement takes care of the majority of the problems. Still a lingering issue is the class-action lawsuit that is ongoing, filed by The Turtles, a 1960s band. The lawsuit was filed in 2013 and has yet to be resolved, however Florida has already thrown the suit out. The Turtles have also sued Pandora in 2014 and are currently seeking more targets to acquire.
As far as the multi-million dollar settlement, SiriusXM will be able to play the songs in question until 2017, at which time they will enter negotiations for a new five-year deal through 2022.
The Recording Industry Association of America is obviously happy about the ruling, but for once I can't say I disagree with them. CEO Cary Sherman said, "This is a great step forward for all music creators. Music has tremendous value, whether it was made in 1970 or 2015. We hope others take note of this important agreement and follow SiriusXM's example."