Congress Examines XM’s Song Recording
A House subcommittee Wednesday grappled with the sort of abstraction likely to become more common in the digital age: When is a radio more than a radio?
Before the House subcommittee on Commerce, Trade and Consumer Protection was a device from XM Satellite Radio Holdings Inc. that allows subscribers to digitally record as many as 50 hours of songs as they’re played over the air. Users can create their own playlists, but the songs are locked in the $400 radio so they can’t be burned onto CDs or shared over the Internet.
Record labels say they deserve to get paid extra when their songs are captured in the radios. XM disagrees. Enter Congress.
As all manner of content goes digital, Congress is wrestling with new rules to protect the people who create it.
XM Chairman Gary Parsons said the XM2go service allowed the equivalent of taping a song off broadcast radio with a cassette player. Such recording is allowed under the current applicable law, which was last revised in 1992, long before anyone had ever heard of Napster, iPod or digital rights management.
“Making it easier does not necessarily make it illegal,” Parsons told the panel Wednesday. Users have access to their downloaded songs only while they are XM subscribers, he said.
Music industry lawyers countered that XM2go was really just a free download service allowing users to pull in just about any song they want from XM’s wide variety of music channels.
“It’s a great device. In fact, it’s much like an iPod,” said Michael Ostroff, general counsel for Universal Music Group. “But unlike an iPod, you don’t have to pay for the music you keep.”
Although other music services, such as Rhapsody, offer similar download programs for subscribers, they pay distribution fees. Ostroff noted that Sirius Satellite Radio Inc. had agreed to pay extra distribution fees for the use of songs on its similar device. XM has been negotiating with record companies over a distribution fee as well.
That’s the result some members of Congress are pushing. But a bipartisan bill has been introduced by Sen. Dianne Feinstein (D-Calif.) that would prevent satellite, cable and Internet broadcasters from allowing individual songs to be downloaded and sorted into playlists unless “fair market value” is paid to the copyright holders.
That bill joins two others in the House that would affect digital music. One would allow consumers to break encryption locks on songs or other digital works to make a few copies for personal use. Another would include a signal in high-definition radio to prevent unauthorized digital recording.
But Wednesday’s hearing focused on XM’s new service.
Rep. Mary Bono (R-Palm Springs) acknowledged that she had a stake in seeing XM pay distribution fees, saying she could afford college for her son this fall only because of royalties from the songs of her late husband, Sonny.
During the hearing, Bono said she had just programmed one of the XM devices to record every song by Elvis Presley played over the next 30 days.
“You’re saying this is not a download, I’m saying it is,” she told Parsons. “I don’t want to see you profit ... on the backs of the songwriters.”
Bono said afterward that having something tangible like the XM device helps focus lawmakers on the often theoretical issue of digital copyright protection.
“You realize this is happening today, right now,” she said. “It wakes people up.”
