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Should EMI sue itself?

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A posting in Robert Fripp's online diary provides some fascinating inside information on the poor and starving but caring, sharing music industry. Fripp and obscure but legendary band King Crimson have parted company with EMI/Virgin over digital download rights; not, apparently, because Fripp is agin downloading as such, but because he has just a couple of minor quibbles about distribution of the royalties.

Apple, you'll recall, gets to keep 4 cents out of the 99 cents price of a download. What does Fripp get? Read on: "the reason for the foundering of our re-licensing negotiation with EMI, last year, was on the subject of accounting for digital downloads. we were told - face to face - that digital downloads "were not important" and therefore should not concern ourselves with a royalty of 6 cents when EMI received c. 69 cents per download (the artist royalty subject to packing deduction, of course). we proposed a third party licensing arrangement, to receive 75% of receipts. and if downloading was not important, then why not? the reply, to support the investment in downloading technology EMI need a high royalty, is spurious. the investment in that technology came from IT, not record companies. a small part of that investment (a mere $4 million) was the result of an initiative by david singleton here at DGM (BootlegTV in seattle)."

King Crimson and Fripp never granted any digital download rights to Virgin, as the technology didn't exist when the original deal was struck in 1993. This expired at the end of 2003 (we presume the "2004" in Fripp's diary is a typo), with existing stock sale being permissible until 30th June 2004. King Crimson downloads however started appearing on iTunes Europe and OD2 in July, while various "partners" appear to have been selling back catalogue well after the cut-off date.

The diary quotes the caring, sharing EMI: "As you are aware, we have notified our digital partners a number of times about the loss of rights and believe that we have discharged our obligations to you in respect thereof - they are aware that they are not entitled to exploit your repertoire and if they continue to do so, you should pursue them for infringement of your rights." The response to this is entertainingly blunt, almost good enough to make us want to listen to a King Crimson track (almost...), but a lot of artists aren't going to feel able to tell labels where they can stick their 6 cent faits accomplits.

But hang on, what kind of process is going on where a company shares digital music it doesn't own with other companies? Good lord, it's not illegal filesharing, is it? Not unauthorised distribution, is it? Will EMI have to sue itself? ®

(Thanks to Roger Barnett for pointing this one out to us)

Related links

Fripp's diary
Much smoke to BPI's fileshare suits, but where's the fire?
How the music biz can live forever, get even richer, and be loved

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