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News > Companies
Napster? We all infringe!
August 2, 2000: 7:50 a.m. ET

Napster's in the hot seat, but infringement happens everywhere
By Staff Writer Franklin Paul
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NEW YORK (CNNfn) - Even if you've never used Napster, and 'swapping MP3 files' sounds like something from a James Bond film, chances are you have recently witnessed, or even perpetrated, the infringement of music copyright rules.

Like jaywalking, the sale, distribution or performance of music without proper permission is an everyday occurrence, one that routinely goes unnoticed and unpunished, experts say.

graphicPerhaps millions of Napster users awakened to their alleged impropriety last week after a California court ruled in preliminary hearings that the service, which allowed users to pick popular songs to download from the hard disk drives of other Napster users, created an environment ripe for infringement.

Threatened with a court-imposed shutdown, Napster won a reprieve on Friday in an appeals court. But while Napster battles so-called Big Music in court over the nature of copyright principles, the law is being broken, or at least bent, in many places everyday.

Where, you ask?

graphicRemember that raucous Homecoming bash thrown years ago by your fraternity, where you charged everyone a few bucks to enter and blasted really loud tunes?

graphicHow about funky tapes or CDs of chart-topping songs that you bought from a sidewalk vendor for a price far cheaper than what you'd pay at retail?

graphicTapped your toes lately to familiar ditties at the local laundromat, or at your hair stylist's brand new location?

Each of these instances represents a potentially infringing environment, particularly if the venue -- the frat house, barbershop or gym -- did not acquire the rights to play music from its owner - namely the label, artist or publishing organization.

Why?

"Because it is a public commercial use of someone's property," said Phil Crosland, senior vice president of marketing for ASCAP, which licenses and collects royalties for the public performance of copyrighted works of artists ranging from Duke Ellington to Sean 'Puff Daddy' Combs.

Under the United States Copyright Law (Title 17, United States Code), the proprietor of any establishment playing music must obtain authorization to do so.

"You can get a license - or you can go directly to the publisher or the owner of that copyright and say, 'I want you permission to play that music,'" he said.

Licensing fees are required for any public performance of a copyrighted song, whether it's a live show at a nightclub, a tune played in a funeral home, background music piped into a grocery store, or a cassette tape played on a boom box at an aerobics class.

Depending on their needs, radio and television stations, cable systems and networks, bars, restaurants, hotels, studios and colleges pay for a 'blanket' license from one or all of the major performing rights organizations: ASCAP, BMI, and SESAC.

graphicDon't worry. The $40 billion recording industry isn't likely to send a cadre of lawyers to sue Jacques, owner of your salon, or to seek injunctive relief against Omega Kappa Gamma fraternity. Not yet anyway.

"Legal action is our last step - we don't want to market our members' music through litigation," said ASCAP's Crosland. The organization, which represents some 95,000 composers, lyricists, and music publishers, works with venues to ensure that they are aware of their licensing options.

Crosland said hundreds of thousand of restaurants and bars pay ASCAP an annual fee - which varies widely but averages about $200 to $600 -- for permission to play any of the more than 4 million songs it has in its repertory.

Other establishments do not pay, perhaps because they don't know they need to. SESAC, which is much smaller than the other two groups, but does license the music of Neil Diamond and Bob Dylan, says that violators caught improperly using any one selection within its repertory can be held liable for damages, from a minimum of $750 up to a maximum of $150,000 per song infringement.

So, from time to time, in order to encourage the purchase of licensing - and discourage infringement - the organizations set an example by releasing their legal hounds.

"We will pick out some real blatant violator in a geographic area and we will publicize the fact that we have a member, it may not be a well known member, whose music is being performed and it is being performed without their permission," Crosland said.

Publishing rights, a songwriter's best friend


Despite its apparent linguistic simplicity, copyright - taken literally, an owner's power to allow their work to be duplicated - is an extremely complicated piece of law. Separate organizations represent the different types of copyright, whose names range from mechanical and performing to grand and sync.

"If you are walking into this part of the music world for the first time - yes, it is as complicated as it seems," explained Pat Baird, a spokeswoman for BMI, which licenses the works of artists such as Little Richard, Sting and Babyface.

"It is one aspect of the music business, but not the 'sexy' part of it. This is the nuts and bolts, how-songwriters-make-a-living part of it."

graphicMusic is perhaps the most portable form of entertainment, one that most people enjoy almost entirely for free, thanks to the tens of thousands of radio stations around the globe. But most songwriters make their living off of publishing royalties, those unseen payments changing hands behind every "free" radio tune.

In general, a check is cut to a songwriter each time a tune is played on the radio, or at your favorite restaurant, or incorporated into an advertising pitch. Royalties range in size - for example, just pennies are paid per radio play - but those little bits add up fast.

The catalogs of icons like Sly Stone or Bob Marley ring up millions each year. But even a catchy song from a one-hit wonder, such as 1963's "Just One Look (That's All It Took)," harvests up to $100,000 a year for its writers, in this case Gregory Carroll and singer Doris Troy.

"The bulk of the songwriters who are out there are people who, if they are lucky, maybe had one hit," said James "Jimmy Jam" Harris III, songwriter and producer of dozens of hits for artists like Janet Jackson. "Ninety-eight percent of the songwriters out there truly depend on that little bit of money that gets paid every time a record gets played or you hear a song in an elevator."

Citing one example, Jimmy Jam, a member of ASCAP's board of directors, recounts a friend, Steve Greenberg, who penned the catchy 1980 disco hit, "Funkytown."

"That's his only hit record," Jimmy Jam mentions. "It's still valuable, so every time it gets played or downloaded, he should be compensated for that, whether it's 10 cents or 20 cents. That's his legacy for his kids."

Witness any infringement today?


E. Michael Harrington, copyright expert and professor of Music Theory at Belmont University in Nashville, Tenn., remembers being startled when he read the fine print on his copy of a concert video by a well-known pop artist.

"Along with the warning against unauthorized copying, the typical FBI stuff, there's words I'd never seen before - 'no lending'," he recounted. "Are you serious? I can't lend that tape to my neighbor, my sister or my daughter?"

Typically, if you purchase a CD of your favorite tunes, you have the right to enjoy it wherever you choose: in your home, your car, or your portable music player. You can even make a copy and give it to your friend, copyright experts say.

graphicIt's still okay if you invite dozens of friends over to listen to the music. You can even sell the actual CD that you purchased to an interested buddy. But you might infringe the copyright if you were to charge admission to this gathering, or if you sold homemade copies of your disk to those friends

Confused? You're not alone. Eugene Volokh, a UCLA law professor who specializes in cyberspace issues, says the question of infringement depends on the user's intentions: whether you seek to fill a room with the R&B genius of Bill Withers, or simply line your pockets with dollar bills.

"What you have to do is ask what kind of use is being made," in each instance where a copy is created or music is improperly played. "If it's a private performance in your home, then it doesn't interfere with copyright."

"But if it is a public performance, like at a bar, or in a restaurant, or it's more than just your friends, then it probably is infringement," he said. "If it is a copy, that is the strongest case."

If you want to leapfrog Napster to the top of the copyright infringement hit list then invite a band to play a concert of chart-topping cover tunes in your backyard, sell tickets to the show, and peddle copies of the performance as the patrons exit.

"(Then,) You are using a copy commercially, so it's an even stronger case than Napster," Volokh said. And you are interfering with the market for the copyright owner's works, because they are buying copies from you and not lawful copies."

"That's clearly infringement." Back to top

  RELATED SITES

U.S. Copyright Office Home Page

U.S. Copyright Law

U.S. Copyright Office Basics

Sesac FAQ on Restaurants, Nightclubs, and Bars

BMI

ASCAP

The ASCAP Payment System


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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.