A dispute over royalty rights on copy-protected CDs and other types of music discs is helping to stall the release of some new music technology, and could result in record labels owing tens of millions of dollars in back payments to music publishers.
At issue are "double session" CDs that include two versions of each song on a disc, formatted for playback on different kinds of devices. The most widely distributed type are copy-protected discs that prevent CD tracks from being copied to a hard drive, but that also include a digital version of the songs, often in Microsoft's Windows Media format, that can be transferred to a computer or portable digital music player.
Music publishers and songwriters, who are entitled to payments of a few cents for every copy of a song sold, contend that since these double-format discs hold two copies of songs, they should be paid for both copies. They've been negotiating with record labels for months, but already hundreds of millions of discs have been released around the world, raising the possibility of huge back payments. "From a legal standpoint, the position of the music publishers is that these discs contain two separate (copies of each song)," said Cary Ramos, an attorney representing the National Music Publishers' Association (NMPA). "The fact that they are the same recording doesn't mean that we should treat it as one."
News source: C|Net News.com
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