May 25, 2011

Legal News: Cloud Music

What's Happening:
Storing music in "the cloud" is a big issue in the music industry right now, especially since Amazon and Google have recently - in a bold move - launched music locker services without obtaining licenses from any music labels.  Apple, on the other hand, has inked deals with three of the four majors for its much anticipated cloud music service.  The one hold out, UMG, is rumored to be close to signing on as well.

First, what is this "cloud" that everyone keeps talking about?  If your music is stored in the cloud, all that means is that instead of storing your music on your computer or on an external hard drive connected to your computer, you are storing it on a hard drive elsewhere and accessing it through the Internet.  Amazon says that it doesn't need licenses from the labels because storing music on its Cloud Drive is exactly the same as storing it on any other cloud storage service, like Dropbox, or on an external hard drive, neither of which have licenses.  The majors have been resisting cloud storage services because they are concerned that users will upload illegally obtained music to their lockers and that the lockers will aid the sharing of music between friends.

So is what Amazon and Google are doing legal?  What it really comes down to is this: should playing music stored in a cloud service be legally treated like playing a song from your hard drive (because it has the same function even though the files are stored elsewhere - this is sometimes referred to as "spaceshifting") or should the law focus on the fact that songs are being copied onto the cloud and then streamed back to the user via the Internet (arguably a public performance that Amazon and Google should pay for the right to do)?

Amazon and Google are claiming that they don't need licenses because the music file that you upload into your "locker" is the exact same file that is played back to you when you listen to it on their services.  The problem with doing it this way is that it takes a long time to upload your music collection to your locker and it requires a lot of storage space from Amazon and Google.  The way that these companies (and probably Apple) would like to do this is to scan your music collection for legal files that they would then match to one single copy on Amazon or Google's servers.  It is that one copy that everyone who owned that particular song would hear when streaming it through the service, eliminating the need to upload and store entire music collections.

Whether this time and storage saving method requires a license is up in the air, but Amazon and Google are not willing to take that chance.  This question is actually being litigated right now in the EMI v. MP3tunes case, and the result could determine the future of cloud computing.  Should the law focus on the technical fact that one copy of a song is being streamed to multiple people, or should it look to how it "feels" to the user, which is that the song the user owns is being played back to him or her, even if it is not the technically exact same copy for efficiency's sake?

Why It's Important:
A lot of people think that storing data in the cloud is not only the future of the music industry, but the future of computing in general.  The shift to being able to access your music collection from anywhere would change not only how music is listened to, but how it will be sold, marketed, shared, etc.  As future movers and shakers in the music industry, it's important to know what's next so that you can prepare to use it to your advantage (and maybe even explain it to your boss!).  The struggle between technology and content creators will continue to play a huge part in how the music industry evolves, so stay tuned.

- Lauren
Email: lauren@internlikearockstar.com | Twitter: @Musicn3rd
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