Original URL: http://www.theregister.co.uk/2007/07/12/warners_in_deal_with_imeem/

Warner rescues imeem from indie-music hell

Goodbye, litigation. Hello, partnership

By Cade Metz

Posted in Media, 12th July 2007 23:09 GMT

Just two months after Warner Music Group sued online media-sharer imeem, claiming copyright infringement, the two companies have announced a rapprochement. That's French for "the big record labels are beginning to like this Web 2.0 thing."

Warner has dropped its suit, allowing users to share its entire audio and video catalog via imeem's instant-messaging-based social-networking service, The Wall Street Journal reports. In exchange, imeem will pay Warner an unspecified portion of its revenue. The two companies are calling the agreement "a strategic partnership focused on creating innovative digital media opportunities."

"Our strategic partnership with Warner Music Group represents a very significant milestone for imeem - we are now able to offer our users an impressive level of free, interactive, and ad-supported access to an amazing catalog of both audio and video from a major record label," said Dalton Caldwell, imeem's founder and chief executive officer. “We are excited to explore innovative digital opportunities together with Warner Music Group and drive cool new ways of connecting online fans directly with artists and their music.”

In May, Warner sued imeem in a U.S. District Court in Southern California, claiming that the startup's online service - said to have 16m active users - was facilitating widespread sharing of its copyrighted material. The service allows web junkies to create and share "playlists" of their favorite photos, songs, and videos. Originally, users could freely share almost any content, but in the wake of Warner's suit, imeem completely revamped the service, cracking down on unauthorized streaming and agreeing to share ad revenue with content owners.

Using a content identification platform from SNOCAP, imeem ensured that songs and videos couldn't be freely streamed unless the copyright holders signed on to receive ad dollars. If a holder didn't join up, its songs and videos were cut down to useless 30-second clips.

At launch, only independent labels agreed to participate, representing few big name artists (Belle & Sebastian and Thievery Corporation made the press release). As Caldwell told The Register, the revamped service included unadulterated songs from "80 to 90 per cent of the indie aggregators," but that isn't saying much. Calling the service a shell of its former self would have been kind.

Signing Warner gives imeem a serious shot in the arm, and Caldwell believes this could lead to deals with other "Big Four" labels. "We're talking with everyone," he said. "We're trying to build the biggest and best service we can - and we're trying to help content owners make as much money as possible." Sony BMG recently signed on with social networker Last.fm, and all four major labels have inked digital music deals with YouTube, the Google-owned video sharing site.®