Faxon's plan, the sources add, includes new distribution deals and securitizing assets on the publishing side.

"They're looking at new ways to monetize their assets," said one source. "They're looking for distribution deals or a sale on the recorded music side."

While EMI boasts successful artists such as Katy Perry, Coldplay and Robbie Williams, the iconic British music company is struggling to stay afloat.

Distribution deals, which involve outsourcing the delivery and sale of music to retailers and digital distribution platforms, would help EMI cut its internal sales and marketing expenses.

On the publishing side, EMI may cherry-pick certain catalogs and securitize them, which involves giving up a stake in the catalog for up-front cash. EMI declined to comment.

Read more: http://www.nypost.com/p/news/business/emi_eyes_revival_hwnQ2q3bCYGaSuqrGINEEK#ixzz0tr2kMTGd

Daniel Ek, the chief executive of the internet music streaming service, said that Spotify now had more than half a million subscribers. He said: “It is growing healthily and if you look at any subscription service around the world we are, if not the biggest, then one of the two or three biggest.”

• By David Kravets
• June 23, 2010  | 
• 4:41 pm  | 
• Categories: Digital Millennium Copyright Act

Read More http://www.wired.com/threatlevel/2010/06/dmca-protects-youtube/#ixzz0tU8MQqvA

In a recent webinar hosted by Audible Magic, a company that sells content protection technology to schools, participants learned that as of July 1, colleges and universities must comply with the peer-to-peer (P2P) provisions of the Higher Education Opportunity Act (HEOA), a federal regulation that aims to stem illegal file sharing.

“This is an important issue,” said Jay Friedman, vice president of marketing for Audible Magic, “because [according to a report by the Administrative Office of the United States Courts], in just the last year, the number of lawsuits filed by the U.S. Copyright Group alone has jumped. In 2009, there were 2,000 lawsuits filed. In just the few months in 2010, 14,000 have been filed.”

Friedman explained that “the burden is really on the institution to be HEOA compliant, because this new regulation requires annual disclosure to students, requires the use of one or more tech-based deterrents, and states that institutions must ‘effectively combat unauthorized P2P use with measurable results.’”

But knowing how to comply with HEOA might take more than a simple read-through of the law’s very vague definition…

Read the full story on eCampus News.

Both Google and Bing are searching for ways to position themselves as the best entertainment discovery tool.  While Bing's offering is slightly more robust than Google's; it may not take them long - as recent rumors suggest - to catch up.  Since, two weeks ago, the recording industry demanded that Google needs to stop linking to the Pirate Bay; it opens the big question as to whether or not they will sustain search neutrality, if they do open their own download store. 

Since removing the infringing links would likely ease the negotiation process with the major labels and drive profitability to their entertainment content strategy, like Bing has done, it remains to be seen if Google will take the same path.  Not doing so, could stall the negotiations required for Google to enter the digital music market and likely lead to an even bigger lawsuit than the Viacom case that was brought against YouTube.  As industry analyst Mark Mulligan framed this unique situation, "...Google is going to need to decide whose side it is on."

But billions are billions, regardless of which way the cashpot is moving.  And, several areas showed growth in 2009. What are they?  The IFPI offered a closer look at the data to Digital Music News (all global calculations).

(1) Performance Royalties on Recordings

Up 7.6 percent to $785 million in 2009. 

(2) Digital

Up 9.2 percent to $4.307 billion.  And, digital channels now account for 25.3 percent of all worldwide music sales.

(3) The rate of decline on physical.

Physical formats (primarily the CD) tanked 12.7 percent to $11.934 billion, but - for what it's worth - the rate of decline is cooling.  In 2008, physical dropped 15.0 percent.

(4) Lots of free, but legal, stuff.

The IFPI pointed to major usage gains across free-and-legal sites, including Spotify, YouTube, Deezer, Pandora and others.  Of course, that growth comes with controversy, simply because these services have yet to unlock a serious cash component.

(5) A few countries actually gained in 2009, including Australia, Sweden, and the UK.

The IFPI counted 13 different gainers, though some barely crossed into the black.  In context, most of these markets are seriously beaten-up, though gains are gains.

Australia improved 4.3 percent, according to the IFPI, thanks to a 43.4 percent digital gain. But physical edged downward.  

Similarly, the UK gained 1.9 percent, an improvement that could complicate three-strikes initiatives.

Who else?  Sweden actually posted double-digit (11.9 percent) gains, an improvement attributed to anti-piracy (IPRED) legislation.  Now, the question is whether those gains will stick, or if they simply reflect a temporary scare.

In Asia, South Korea posted a 10.4 percent gain.  The IFPI thanked three-strikes legislation in that region, "an example of a market where both 'carrot' and 'stick' factors are now present".

By Jacob M. Gear

In April 2003, Apple Computers, Inc. launched the “iTunes Music Store (ITMS)”.  This strategic business endeavor awarded Steve Jobs and Apple Computers a strong upper hand in the evolving landscape of the music business—record sales where plummeting, retail stores were closing their doors forever, and illicit downloading was rampant.  Despite industry-wide hardships, the Apple camp seemed braced for the storm with a hand in multiple segments of the music business: software for the delivery of musical content (iTunes), an online retail store to purchase musical content (ITMS), and the hardware to play the content on (iPod).  All seemed “peachy” in Silicon Valley, but another storm was brewing across the pond. 

Soon after the release of the ITMS, Apple Corps Limited, most notably known as the record company synonymous with the Beatles, filed a lawsuit claiming a breach of a previous trademark agreement dated October 9^th, 1991 (Mann, 2).  Due to the nature of their respective names and trademarks, the two parties had a history of conflict. The 1991 Trademark Agreement (TMA) provided a new regime to avoid further conflicts between the parties, and allotted to each party their own areas of exclusive use.  In this article, I aim to examine the 1991 TMA, the arguments of each party, the judgment by Justice Mann, and the future ramifications of this judgment on the music industry.

 The Trade Mark Agreement (1991) & Dispute

 The agreement dated October 9^th, 1991 contained no choice of law clause denoting its jurisdiction, but was held to be an English law agreement in 2004 (Mann, 2).  As is the nature of most trademark disputes, this case is tediously intricate.  A large factor that further complicates this matter is the fact that technology has increased so rapidly since the synthesis of the agreement, that most of Apple Computer’s uses alleged to be breaches were unforeseeable in 1991.  Trademark scholars and legal-types could debate endlessly on these subtleties; thankfully though, in trademark law it is relevant to consider how things would appear to the “average consumer”—one who is “reasonably well-informed and reasonably observant and circumspect” (Mann, 19).  For the sake of simplicity, plaintiff and defendant shall from this point forward be respectfully referred to as “Corps” and “Computer”.  Furthermore, the relevant terms of the TMA have been laid out below, with italics used to emphasize particularly imperative language:

1.2 ‘Apple Computer Field of Use’ means (i) electronic goods, including but not limited to computers, microprocessors and microprocessor controlled devices, telecommunications equipment, data processing equipment, ancillary and peripheral equipment, and computer software of any kind on any medium; (ii) data processing services, data transmission services, broadcasting services, telecommunications services; (iii) maintenance, repair, financing and distribution; (iv) printed matter relating to any of the foregoing goods or services; and (v) promotional merchandising relating to the foregoing.

1.3 ‘ Apple Corps Field of Use’ means (i) the Apple Musical Artists; the Apple Catalog; personalities or characters which appear in or are derived from the Apple catalog; the names, likenesses, voices or musical sounds of the Apple Musical Artists; and musical works or performances of the Apple Musical Artists; (ii) any current or future creative work whose principal content is music and/or musical performances; regardless of the means by which those works are recorded, or communicated, whether tangible or intangible (iii) promotional merchandise relating to any of the foregoing; …

4.3 The parties acknowledge that certain goods and services within the Apple Computer Field of Use are capable of delivering content within the Apple Corps Field of Use. In such case, even though Apple Corps shall have the exclusive right to use or authorize others to use the Apple Corps Marks on or in connection with content within subsection 1.3(i) or (ii), Apple Computers shall have the exclusive right to use or authorize others to use the Apple Computer Marks on or in connection with goods or services within subsection 1.2 (such as software, hardware or broadcasting services) used to reproduce, run, play or otherwise deliver such content provided it shall not use or authorize others to use the Apple Computer Marks on or in connection with physical media delivering pre-recorded content within subsection 1.3(i) or (ii) (such as a compact disc of the Rolling Stones music).

When considering this case, it is important to keep in mind that the dispute arises over the use of an apple logo in connection with the iTunes Music Store—Corps acknowledges there is no breach of the agreement by Computer’s use of an apple logo in connection with Macs, iPods, or even the iTunes software.  For further emphasis, Corps claims that the use of an apple logo on or in connection with the ITMS is a breach of the 1991 TMA.  As set forth in the TMA, Corps is entitled to use its mark on or in connection with music content and Computer is not (Mann, 5).

Corps Argument for Breach of Agreement by Computer

In a nutshell, Corp has argued that Computer’s use of an apple logo in connection with the ITMS falls within Corp’s designated “Field of Use” in Clause 1.3.  Therefore, Corps claims that Computer is essentially acting as a record label whose principal business is the financing, manufacturing, marketing, distribution, and sale of recorded “music and/or musical performances” (Clause 1.3).  Corps alleges that the entrance of a strikingly similar trademark into their market for recorded music will cause consumer confusion, trademark dilution, and taint the name and goodwill that Apple Corps has established over the years.  Although, on the surface, the ITMS appears to be an innocent online retail store for the sale of digital music, Corps has uncovered some skeletons in Computer’s closet—which they claim equates the ITMS business model more appropriately to that of a record label than to a “digital Sam Goody”.  The following are factual events cited in the judgment that Corps relied on to show that Computer is actually affecting content to a greater degree than one who merely sells digitized musical tracks (acting as a record company):

         i.            ITMS, like a record label, has tracks or collections which are exclusive to ITMS for a period of time (weeks or months), meaning the ITMS is the only place where the tracks can be obtained.

        ii.            Computer, acting like a record label, has arranged recording sessions which produce recordings to be made available exclusively through the ITMS for a period of time.

      iii.            ITMS features special playlists selected by performing artists, featuring tracks or other artists that they particularly like.

      iv.            Computer, acting similar to a record label, has arranged collections of recordings of artists into a “boxed set” which include tracks that have previously been unreleased.

       v.            ITMS offers its own collections of tracks in the form of “iTunes Essentials”—favorites chosen by the iTunes Music Store staff experts.

      vi.            Artists sign themselves up to ITMS by means of an online application procedure.  ITMS, acting much like a record label, contracts with talent for their content to be sold on line.

Along with these events, Corps has also pointed to various advertisements (video, static, gift cards, and email) that have portrayed the use of the apple mark in connection with recorded music.  The video advertisements which Computer was alleged to have used its mark in manners constituting a breach of agreement have been included at the bottom of this article. 

Next, every Tuesday ITMS sends out a mass-email to all account holders who have not elected to not receive it which reads: “iTunes new music Tuesdays”, “New Releases”, or “Just Added.”  Coincidence or not, this has also traditionally been the day of the week that record labels chose to release their artists new albums for sale to the public.  This fact is further leveraged by Corps to equate the business activities of Computer to those of a record company.

Lastly, Corps points to two other matters lending color to the alleged breach.  First, is an annual report submitted by Computer that reads: “The Company [Computer] believes it maintains a competitive advantage by more effectively integrating the entire end-to-end music solution, including hardware (iPod), software (iTunes) and music content (iTunes Music Store)” (Mann, 12).  This language shows that Computer intended for its marks to be used in connection with music content; and that it is part of the “commercial ethos” of Computer.  Secondly, Corps cites a public speech by Steve Jobs in which he references the fact that Computer had been honored with a Technical GRAMMY (an award from the record industry); Jobs also goes on to equate selling music by download to a digital equivalent of selling analog CDs.  Therefore, when an apple mark is used in connection with producing an “integrated end-to-end music solution”, that action is inevitably in connection with music content.

Corps leans heavily on the wording in clauses 4.3 and 1.3 to construe the disagreement in their favor.  Emphasis is placed on the fact that clause 1.3 (ii) includes the language “…whether tangible or intangible,” which would cover the intangible communication that takes place in an internet download.  This would place the activities of the ITMS, and the use of an apple mark in conjunction with such activities, into the prohibited field of use reserved exclusively for Corp constituting a breach of agreement.  Overall, Computer is acting as a record company and using the apple mark in association with musical content—it is pre-packaging music, procuring recordings and then selling them under its banner in exclusive tracks and virtual boxed sets (Mann, 15).

Defense of Computer

Computer constructed its defense around a different understanding of the phrase “on or in connection with,” which is included in clause 4.3, and also the Trade Marks Act 1905, and Trade Marks Act 1938 (Mann, 16).  For Corps, this wording refers to content; to Computer, this wording refers to indication of the source of origin of the rights to the music.  Therefore, according to Computer, in order to breach the agreement they would have to use their mark to indicate ownership of the musical content.   In their defense, Apple does not retain ownership of the content, nor do they use their mark as an indication of ownership.  Ownership of the musical content is retained by the record labels who license certain uses to Computer; Computer also attributes the owner with information such as track name, album title, artist, record label, etc within the ITMS. 

Also, Computer claims that its advertisements are always of the service or the hardware, and not of the musical content.  Next, Computer draws attention to Corps approval of the use of the mark in iTunes, claiming that there is no material difference between the use of the apple logo in iTunes and its use in the ITMS (Mann, 15).  Lastly, Computer argues that use of its mark on its service falls within its “Field of Use” due to the language in both clause 1.2 (ii) which includes data transmission, and clause 4.3 which includes delivery.

The Judgment (Link)

As previously stated, the perception that is relevant to this case is that of the average consumer, and not that of a trademark lawyer.  That being said, Justice Mann of the Chancery Division of the Royal Courts of Justice found that Computer’s use of their apple mark in connection with the iTunes Music Store was not found to be a breach of the 1991 Trademark Agreement.  Justice Mann claimed that an average consumer would be familiar with purchasing recordings from a retailer, and would be capable of not seeing any other association between retailer and the music other than that arising out of the sale itself (Mann, 20). The judgment stated that while computer does not have the right to apply its marks to musical recordings/content, it does have the right to use its mark in connection with the service which sells content (Mann, 19).  In relation to the advertisements, Justice Mann noted that “the average viewer will realize that [“applemusic.com”] refers to the download service; even the less astute will nevertheless know that one goes to a website to find out where to get the music from.  In each case the apple mark is associated with the web address which is in turn associated with the downloading service” (Mann, 24).  Justice Mann concludes his judgment by finding no demonstrated breach of the TMA in the given circumstances—the action therefore fails.

Ramifications on the Music Industry

As the music industry continues to blindly charge with great uncertainty into the future, Apple Computers will continue to be a key player in hardware, software, and content delivery services.   The judgment from this dispute has left Apple’s expansion into other sectors of the business unbridled.  The only point of resistance resulting from this judgment is the affirmation that Apple Computers cannot use its apple mark on or in connection with musical content.   In the context of the available information, it can be concluded that Apples rumored ventures into the music “cloud”—by acquiring music streaming service LaLa—would also be permitted due to their ability under the 1991 TMA and judgment to use their mark in connection with the transmission of data.

Another rumor recently circulating the music industry blogs was that Apple Computers may be entering the record business.  In summary, the rumor hinted that Apple Computers were in negotiations to buy out struggling record label EMI from the private equity investment firm, Terra Firma.  The blog post, originally by Bob Lefsetz, hypothesized that if this  acquisition were to take place it would have negative repercussions on the industry including: drastically lowering the prices of songs in the EMI catalog on the ITMS to undercut other tracks and force their labels to agree to lower pricing points (Lefsetz, 1).  This would significantly reduce revenues from digital downloads off the ITMS, but would drive consumers to purchase more Apple hardware.

 In the end, this rumor turned out to be a bad April Fool’s Day joke.  Nevertheless, with the constant consolidation of the record industry, there are significant hypothetical questions that arise from this possible situation.  Could Apple Computers enter the record business and act as a record label? In short, this answer seems to be no—they are not allowed to use their apple mark in connection with musical content.  However, this only refers to the mark, and does not mean that the company couldn’t develop a different trademark and/or brand-name for an Apple invested record label (Macintosh Records perhaps?).  While this does seem quite far-fetched, and would probably be subject to anit-trust laws, with the information given it is a legal possibility—especially with the recent approval of the LiveNation-Ticketmaster merger. 

Either way, Apple Computers will continue to have a substantial impact on the music business with their market dominance in portable hardware (iPod, iPhone, iTouch, iPad), software (iTunes), and music services (ITMS).  Business adventures into streaming services and record labels (hypothetically) would only continue to tighten its hold on the music business.  Whether this hold is a chokehold suffocating the industry’s very last breaths, or one that the industry is holding onto for dear life as it is suspended above an abyss of file-sharing, market saturation, free music, and decreasing record sales, is a question for another article.

Works Cited

England. Royal Courts of Justice. Chancery Division. Apple Corps v. Apple Computer: Judgment in Full. By Justice Mann. Times Online, 8 May 2006. Web. Apr. 2010. http://www.business.timesonline.com.uk/tol/business/law/article714550.

 Lefsetz, Bob. "Apple Buys EMI." Web log post. Lefsetz Letter. 1 Apr. 2010. Web. 1 Apr. 2010. http://lefsetz.com/wordpress/index.php/archives/2010/04/01/apple-buys-emi/.

Works Consulted

“Apple vs Apple: Why Didn't Apple (the Music One) Win? We Explain All ..." Guardian. 8 May 2006. Web. Apr. 2010. http://www.guardian.co.uk/technology/blog/2006/may/08/applevsapple.

"At the Core of the Apple Dispute." Online Posting. BBC News. 8 Apr. 2004. Web. Apr. 2010. http://news.bbc.co.uk/2/hi/entertainment/3610523.stm.

Barrett, Damien. "Apple Computer vs. Apple Corps." Tuaw: The Unofficial Apple Weblog. Weblogs, Inc., 27 Mar. 2006. Web. Apr. 2010. http://www.tauw.com/2006/03/27/apple-computer-vs-apple-corps/.

"Beatles Label Loses Apple Logo Case to ITunes." Guardian. 8 May 2006. Web. Apr. 2010. http://www.guardian.co.uk/business/2006/may/08/citynew.artnews.

"Breaking: Apple Corps Loses Court Battle." Guardian. 8 May 2006. Web. Apr. 2010. http://www.guardian.co.uk/technology/blog/2006/may/08/breakingapple.

Hormby, Tom. "What Is in a Name? Apple Corp vs. Apple Computer." 2 May 2007. Web. Apr. 2010. http://lowendmac.com/orchard/07/0110.html.

Salkever, Alex. "Byte of the Apple." BusinessWeek. 30 Sept. 2004. Web. Apr. 2010. http://www.businessweek.com/technology/byteoftheapple/blog/.

In his own statement, Pandora founder Tim Westergren said they has been working on making the service more social for some time. "The idea behind today's update is to make it really easy to share your Pandora stations and music discoveries with your friends - and vice versa," according to Westergren "To make this truly easy for you, we've partnered with the experts at Facebook. Starting today, you can easily link your experience on Pandora with your friends on Facebook. This quickly brings your Facebook friend list into Pandora along with your Facebook profile picture. It quite literally puts a whole new face on Pandora."

Original article in Hypebot.