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All Major Labels Are Suing Grooveshark (nytimes.com)
116 points by igorgue on Jan 6, 2012 | hide | past | favorite | 96 comments



I work in music, with a lot of indie labels and musicians, and for once the ENTIRE industry is inline on something. Grooveshark has been actively hostile to artists requesting their music be removed from the service, their terms are unfriendly and their staff is rude, and if even a fraction of the allegations against their management are true they should be held personally accountable.

Everyone in this industry understands playing fast and loose with regulations but Grooveshark repeatedly crossed the line and has made only hollow attempts at seeing artists compensated. For once this isn't RIAA greed, it's acceptable and appropriate action.


I used to work for Grooveshark and your accusations are pretty unfair. We've always complied with the DMCA and our terms are equal to what you'd find on any other UGC site. GS also signed up hundreds if not thousands of small indie labels that have loved working with us. Have you seen the Featured section or any of the Artist theme promotions? Yea, many of those are unsigned artists that we promote often for no cost. We've done great things for bands like Skyrocket Love and Tay Dizm. http://www.digitalmusicnews.com/stories/040811grooveshark

> Their staff is rude

You're welcome to form your own opinions, but I can tell you that the people who work at Grooveshark are some of the nicest and most fun-loving individuals you'll ever meet. You have to be humble in this industry. You don't make a whole lot of money and you have to hustle to sign up every act you can. You go to every concert. You meet with every executive. And at the end of the day you give away 70% of your hard-earned money to someone else.


I personally work with hundreds of artists and MANY of them have been treated terribly by customer service when trying to initiate take-downs. When urged to sign licensing deals it's all or nothing, and if they choose nothing the music remains up on the site regardless. Really — having worked with literally every streaming company I've never seen a higher rate of artist and indie label dis-satisfaction. Not an accusation but a blunt observation.

As for rude: you just demonstrated it. If you think you're giving away 70% of "your money" you don't get it. You're getting a 40% commission of THEIR MONEY. Your money has been made of the backs of creators, and to turn around and call those indie label executives shitheads doesn't endear you to anyone no matter how many concerts you go to.

The only accusations being made, not by me, are the ones in the lawsuit: which claim that Grooveshark executives were uploading content illegally to their own system. If true this is one of the more offensive things I've ever seen from a startup.


> As for rude: you just demonstrated it. If you think you're giving away 70% of "your money" you don't get it. You're getting a 40% commission of THEIR MONEY.

Absolutely not. Both parties need each other. It collectively belongs to both of them.

> Your money has been made of the backs of creators, and to turn around and call those indie label executives shitheads doesn't endear you to anyone no matter how many concerts you go to.

I didn't see him call anyone a shithead. And you could just as easily say that the labels make money on the backs of artists. If you want to be rude and dismissive of others.


And I'm curious — really asking not being passive agressive — do you see an iOS app developed by an independent developer as belonging to both the developer and to Apple?

I'd say that Apple's 30% is a commission based on the sales and service they offer, and yes it's worth it...especially given the market position and the fact that there's verification of IP ownership, etc. But in the end the app itself belongs to the creator, just as the music belongs to the artist (or label, depending on the deal.)

Seems a bit like perspective, but it goes deeper: if the music belongs to the artist who created it then they should have the right to pull it from a service and expect reasonable effort to keep it out of the service — YouTube's content ID does a commendable job. (Though it is abused by some of the majors...but the algorithm itself is really solid.)


He was talking about the money, not the content, thus putting it in terms of who owns an iOS app is missing the point. It's about who's profit it is. In which case the discussion is exactly the same.


> do you see an iOS app developed by an independent developer as belonging to both the developer and to Apple?

I've develop a few iOS apps. The money is Apple's until they pay me. I'm entitled to that money under the payment schedule we agreed upon, but Apple can do whatever they want with it in the meantime. I'm sure they do make use of it.


Just to clarify...you gave Apple permission to make money off of your work, right?


Ultimately yes, but the only other choice was to not distribute the work at all. Musicians are given the same choice. If you do not want others to use your work, you can keep it private or not create it at all.


Musicians are given the same choice. If you do not want others to use your work, you can keep it private or not create it at all.*

Wrong. Musicians can choose to distribute the music themselves or through a variety other third parties. iOS developers have no other meaningful choice.


He edited "shithead executives" down to just "executives." I was responding to the original text.

And yes, some labels make money off of the backs of artists, some are really great and make money with artists. Just like some streaming services work out licensing deals before launching a service and others don't.


Please ping me personally on my email and I'll be happy to connect you with the right people. More often than not, these matters are simple communication issues that can be resolved. Even though I don't work there anymore, I'd be thrilled to help out the community any way I can.

Re:"money" issue. Everyone has a hand in making an artist successful. Yes the artist produces the content and should be compensated for such. I fully agree. But Grooveshark brings the audience, the user experience, the hosting, and the analytics. These services aren't free. Do you get mad when people sell you tap water in a bottle and demand $3.00 for something that costs $0.25?


I'd be pretty mad if my friends and neighbors were taking five-gallon buckets of my water, bringing it to an Aquafina factory, and then an Aquafina sales rep was ringing my doorbell trying to sell me $3 bottles of water.


Not taking sides (never used Grooveshark etc), but real world analogies of virtual products don't really work.

Fresh water is a limited physical resource, whereas digital products can be infinitely duplicated at little-to-no cost.


By the way, there's also this link up on DMN:

http://www.digitalmusicnews.com/permalink/2011/111512

I've spoken with a lot of label heads from the more influential names on the list and they were in no way okay with being listed, some actively upset by Grooveshark providing a bad list. The comments echo that, albeit with too much hostility at times.


Like I said above, feel free to ping me and I'll help connect you with the right people.


DMCA should work without "connecting to right people".


That is incorrect. You're supposed to send a valid notice to the registered DMCA agent. Here's the sort of ruling you get when you send out defective notices:

"In Perfect 10, Inc. v. CCBill LLC, the Ninth Circuit held that the properly constructed notice must exist in one communication.[16] A copyright owner cannot “cobble together adequate notice from separately defective notices” because that would unduly burden the OSP."

https://en.wikipedia.org/wiki/OCILLA


Miscommunications happen. Its a fact of life and its even moreso when you're dealing with a complex legal matter. I'm offering up my time as an unpaid ex-employee to help someone out who seems to be having difficulty. The offer stands to others but not indefinitely because as time passes, I'll know less and less people who work at the company.


AFAIK, EMI is suing Grooveshark because they DID make a deal, but didn't get any money anyway


Yeah that's right. It's a little over-reported. It's also EMI publishing not the label.

The original lawsuit brought by Universal is quite a bit more serious: http://news.cnet.com/8301-31001_3-57332246-261/grooveshark-e...


If grooveshark gets shut down tomorrow and I don't get a refund for the rest of 2012, it is still worth what I've paid for this year in advance.

I don't work in music. I don't want to download desktop software or mp3s. Does anyone offer a comparable service?


Rhapsody and Rdio are pretty close. They're like Spotify but I believe both have browser based access. Catalog is a little smaller but I hear plenty of people say they prefer them over Spotify. None of them competes with Grooveshark's catalog, because a huge chunk of Grooveshark's catalog is not there legally.


Yeah Rdio is pretty great, and they give artists access to an under-publicised affiliate program allowing them to earn money off the audience they drive to the platform. Solid iOS app. Personally my favorite of the streaming services.

I'd also keep an eye on eMusic. It's more geared towards downloads, but they offer a lot of really great editorial content for discovery plus they offer multiple streaming radio stations for members. They've got smart people so I think they might make a surge in features.

A lot of people are into MOG.com as well. I have issues with their CEOs attitude towards licenses and how the money goes to creators, but otherwise the catalog is strong and they offer solid access across multiple platforms.


I use Rhapsody (piror Yahoo Music) and I love it. I also use MuvAudio.


I find Jango[1] to be pretty convenient. As a bonus, I've found I like their music suggestions (based on your existing playlist) better than GrooveShark's.

[1] http://www.jango.com


... that are also available outside the US/Canada (German here)


Nope. Especially not in Canada.


Rdio is half-decent in Canada.


I primarily use Grooveshark to listen to small-time Canadian acts that are quite difficult to find elsewhere (online and physically). Does Rdio cover that kind of content?


Enough to satisfy my Radio 3 listening ways. The only big hole in their repertoire is big group back catalogue. For example, there is no Led Zepplin, Beatles, etc)


One word: Karma.

Grooveshark has said repeatedly that they're trying to help artists, but when you look at their business model (upload a bunch of songs illegally, get eyeballs, then charge labels for data), it's been clear all along that the only party they care about is themselves.

Bad karma will always, always come back and bite you.


Good, I guess. For a long time the content companies have been afraid to go very far in court over some of these concepts that push the legal boundaries for fear of an unfavorable precedent.

Sadly, they'll probably just end up saddling Grooveshark with a crippling settlement. Or Grooveshark will be bankrupt before it's all done. Or Grooveshark will lose outright. But barring all those outcomes, there's the very small chance that a reasonable decision regarding music IP will occur - which would change everything.


All the arguments for the legality of Grooveshark aside, it is ridiculously (read: Napster-like) easy to download high-quality MP3s from the service for free. Yes, there are rippers for Youtube and other services, but the quality of downloads is so spotty.

I watched a friend used GrooveShredder [1] the other day, which is a simple Firefox add-on. In 10 minutes, he had downloaded about 50 tracks. That alone made me realize that they were on their way out, so all the arguments for their legality are largely moot.

[1] https://addons.mozilla.org/en-US/firefox/addon/grooveshredde...


How the story about your friend doing something (supposedly) illegal leads to conclusion that "all the arguments for their legality are largely moot"?

Especially after you tell in the very first sentence of your comment to leave arguments about legality aside.

Is this how you propose to judge the legality of a service?

            Can overcome technological restrictions
            to save music into a file instead of letting
            the browser download and play it immediately?
                |                            |
                |                            |
               Yes                           No
                |                            |
                |                            |
            Is the resulting MP3 ---- No ----+---> Legal   
            of high quality? 
                |
                |
               Yes
                |
                +--------------------------------> Illegal!


Try not to be so literal. My implication was that any service that lets a user download copyrighted material for free is bound to be terminated by the labels, and that is largely what is happening.


As opposed to just listen to copyrighted material [for which they have no license to distribute]?


No, that too, but the downloading makes the hammer come down heavier.


FWIW, Pandora is just as vulnerable.


I'm pretty sure he actually meant to put all arguments about legality aside. Any service, no matter how legal, that enables you to easily download high quality label music, no matter how illegal that process is, will be intolerable.


I guess Grooveshark strategy of it being "easier to ask for forgiveness later than it is to ask for permission now" has failed. (http://www.thecmuwebsite.com/article/grooveshark-emails-on-l...)


If anybody read that quote and then went on to do something like Grooveshark, I'd guess it's safe to say they need to adjust their reality compass. It may be OK to push the boundaries in certain areas, grow big and make amends later. But if your concept is to break boundaries, have no model for actual growth apart from ripping other companies off and not even a chance of making amends (apart from maybe changing the law in every country of the world, which won't happen), I guess it's very clear you're doomed to failure.

I don't like what the record industry is doing in general these days, but grooveshark was always very obviously shady if not illegal.


Did that strategy work for any music startup?


it worked for youtube/google


You mean the same youtube where the Viacom sued them for videos uploaded by employees of Viacom [1]?

[1] http://consumerist.com/2010/03/viacom-youtube-throw-legal-pu...


... and Google bought them and made the team millions of dollars? Yeah, that YouTube.


Yes, the same Youtube that sold for $1.65 billion several years before an unsuccessful lawsuit.


How is that relevant?


It's the whole principle behind DMCA, isn't it?


I don't think the DMCA envisioned hosting providers that are specifically designed for infringement.


> I don't think the DMCA envisioned hosting providers that are specifically designed for infringement.

In order to keep their immunity, an online service provider must "not receive a financial benefit directly attributable to the infringing activity." The provision clearly targets hosting providers that are designed for infringement, indicating that they did envision that.


Paying member here. Its truly a wonderful service that I hope survives, despite these legal challenges. Their value for me is in their 'long tail' catalog, with lesser known or foreign bands.


I also wanted to moan about other services missing my favorite songs but I checked wiki [1]. Perhaps when you go through the list you'll find your 'foreign' bands as well :)

[1] http://en.wikipedia.org/wiki/Music_streaming_service#On-dema...


I think what Grooveshark is doing is clearly illegal.

Whether the law is just or current, that is up to debate.


What part do you think is illegal? The part where the users upload their own songs? Isn't that much like Youtube? Youtube won against Viacom in a similar case.


I think you've missed the gist of those lawsuits.

The other labels are contending that Grooveshark employees uploaded the songs and were asked to by management. They claim to have leaked internal documents to prove it.

YouTube didn't upload the content themselves, their users did.

The latter is legal if you comply with DMCA take down, the former is illegal.

This case outlined in the article has nothing to do with either, basically Grooveshark haven't paid a penny to their only major legal avenue to music.

TLDR; Youtube case is nothing like the Grooveshark ones.


They've claimed a lot of things that weren't true in the past. I'd withhold judgement until I can see the evidence for myself.


>The other labels are contending that Grooveshark employees uploaded the songs and were asked to by management. They claim to have leaked internal documents to prove it.

Didn't Viacom claim something similar?


They also have a DMCA section of their site for claims: http://www.grooveshark.com/dmca


Nice move if what they want is for all of Grooveshark users worldwide start downloading music again when they manage to shut it down.


From my understanding (could be wrong) the label's aren't getting paid for their music through Grooveshark, so if they're not getting paid they'd likely prefer to force users to jump through the hoops of pirating music then from using a service such as Grooveshark. (actually they'd prefer you use a free service like Spotify which pays for the music rights).


I would, if Spotify was available in my country.

> they'd likely prefer to force users to jump through the hoops of pirating music

A side effect of which probably would be more users becoming “torrent-educated”.

Also, there's a huge difference between listening to music only on Grooveshark, and having the tracks (CD) bought and lying around on your drive. In the first case you don't own the music.

If you're downloading it, however, the difference almost vanishes, and you have much less reason to pay. You have the files already—so are able to listen without the connection, put it on your player, etc. Like you've bought the music, but without the money.


A side effect of which probably would be more users becoming “torrent-educated”.

Agree. Grooveshark is a top1000 site. I don't think the MI realizes the temperature of the fire that they're playing with here, the media backlash will be significant.

And more importantly they're actively tingling the senses of countless hackers to build a free spotify on top of a P2P network.

Good luck putting that cat back into its bag...


But it would be much more viable to elaborate deals and get paid through Grooveshark.

What I'm saying is that they would benefit a lot more from having Grooveshark as an ally (even if not entirely on their terms) then defeating it and getting back to square zero in the anti-piracy effort.


I would, if I didn't have to be a FB member for Spotify.


What's the difference? Grooveshark isn't paying them anyway.


Labels prefer people streaming over downloading, correct? AsI understand their reasoning, streaming is more inconvenient than a downloaded song, so the incentive to purchase the tracks remains.

(The logic of streaming being more inconvenient than a file makes less and less sense each year, though as wireless connectivity improves).


What is the end game though, hope that the service is successful enough that they will start handing over a cut to the labels? The streaming model is looking fairly broken if the only way for it to work is to operate in a legal grey area.


i didnt find a way to extract all the songs from My Music via the interface.

this stuff should do the trick : javascript: $('div .grid-canvas .slick-row').each(function(index) { console.log($(this).find('div.song').text() + '- ' + $(this).find('div.album').text()); });


Why doesn't one of the labels just buy Grooveshark? Make an offer they can't resist. The record label would get some fresh talent with actual vision, and worst case scenario would be Grooveshark getting shut down and the founders making a decent exit.


Buying companies with huge and unknown legal liabilities is generally a bad idea.


Ahh good point.


Because they don't want to give anyone else the idea that the business idea behind GrooveShark is solid?


Ooh also a very good point. I didn't think of that.


Step 1: Sue Grooveshark. Make it serious, hit them with everything.

Step 2: Send them a settlement offer. Make it huge. Billions. Make it something they'd never consider.

Step 3: Offer number 2 - Acquisition agreement. We'll drop the lawsuit and on-board your product/talent (letting the leadership duck out with a small token) if you agree to a non-compete contract.

Everyone wins.


That is such a beautiful strategy. I truly hope it doesn't come down to that for Grooveshark (I love them), but from a purely strategic point of view for the record labels, that move would be amazing.


Labels don't want a service like Grooveshark to exist, which gives away their product for nothing. If they wanted it, they could easily build it themselves.


They could build a similar service to Grooveshark that didn't give their products away for nothing. People would pay to stream EMI's entire catalogue, so long as the price was right.


Thats a really great question.

The main reason is because the other labels would still want to sue.

Now why can't they all just buy grooveshark together? Because we have anti-trust laws that prevent them from working together like that.

So why don't they just work with grooveshark to get the licensing deals they want and capitalize on the huge userbase? Because the labels see it in their best interest to keep this grey area dangerous to enter. If they struck up a deal with grooveshark more people might get into the game seeking to grab the music industry by the balls and that's not what the RIAA wants. They want a firm grasp on everyone elses.


It's because the major record labels already chose their strategy when they became record labels. They exist for the purposes of managing and licensing IP and suing those they believe are infringing. Bottom line: what do they want fresh talent for when they've made so much money doing this?


Because then Grooveshark doesn't get punished.


One could buy them, but now that label would be pissing off all the rest and a liability. Unless they all bought a portion, but that will never happen.


I wish Grooveshark was a legal service. I haven't downloaded any music since I've started using it.

It's sad that the labels can't take a hint. The music business is changing (just like the software business). Businesses that don't go with the flow will eventually be left behind.


I usually anti-label, but in this case, I don't see the problem. It isn't like the labels are against all you can eat streaming services. They even support "free" ones, like Spotify and Mog. They just want a cut/ownership of the services. The only difference between Grooveshark and Spotify/Mog is a slightly larger library (due to Grooveshark's grey legality), international availability (annoying for the other services, but a weird state the current web has to deal with if they want to stay legal that Grooveshark can ignore), and worse cataloging. Grooveshark doesn't play ball with companies that are willing to play ball, so they get sued for copyright violations. Seems fair to me. Now we test the precedents of DMCA.


The problem is that the labels (much like Hollywood film studios) are clinging to an outdated business model and screwing us all in the process. There might have been a time when licensing content based on geographical region made sense; That time is long gone. When I go to a streaming website and am told I can't use it because of my IP prefix, I don't see a rights-holder making a fair licensing agreement, I see a bunch of clueless old rich dudes mumbling about "kids these days, with their digital doo-hickeys and global mumbo-jumbo."


I may be wrong, but at least here in Germany I'm pretty sure the unavailability of spotify, rdio and so on can't be explained with major labels refusing to allow those service here. No, when it comes to germany you have to look at the media right organisation GEMA that seems to demand unreasonable high fees from streaming services. There is an ongoing dispute between the GEMA and Google concerning Youtube, which is why you will see a lot of videos that are "unavailable in your region". It seems as if at this point these companies aren't even bothering to negogiate with the GEMA anymore. I can't see why labels would refuse to offer their content here.


spotify - not available in most of the world. rdio - not available in most of the world mog - not available in most of the world other online streaming services mentioned here - not available in most of the world

grooveshark - available everywhere

that says it all for me. fuck licensing. all it ever means is that the US wants to screw the rest of the world out of the deal.


> all it ever means is that the US wants to screw the rest of the world out of the deal.

Do you seriously think that? Is that really what you've gleaned from all of this?

The laws around licensing and ownership of content are different in every country. Different people even tend to OWN the same song in different countries. This is very complicated. Just because a company figures out a way to stream in the United States under the provisions of the DMCA and other laws does not mean they know how to stream that content legally in your country.

If no solutions exist for what you want in your country, and the market is lucrative enough to support one, why don't you start one?


But if it wasn't for these 'small' differences Grooveshark wouldn't be a service worth paying for.

Yes I said paying for. I have been a subscriber for ages. Get with the program and get some revenue sharing system set up -- one where the money goes to the artists and not to RIAAs laywers.

With the current state of Washingtonian corruption there is no hope in hell to update the laws legally. Is it really so bad that the laws are being updated illegally?


If Grooveshark did something like an artist revenue sharing program, I'd be more sympathetic to them. But they don't. I haven't seen Grooveshark really show interest in changing what is broken in the music industry. I see a company taking copyrighted work and throwing their ads next to them. Furthermore, taking customers' money to access special features related to the infringement.

Stolen cars can be bought for cheaper and with less paperwork. Ignoring laws does improve the Grooveshark experience. You say the laws need to be updated, but I honestly don't see what is wrong with a company holding rights to the music they produce. Grooveshark makes money off of copyright they don't own. Their own "Popular" featured section is chock full of infringement. They claim DMCA (a law I thought most techies liked), which is fine and well. Worked for YouTube. But they are going to have to defend that in court, and I have my suspicions that they might not be following the letter nor the spirit of DMCA.


Techies like DMCA? I hope not.

The anti-circumvention provisions are ridiculous. Decrypting a DVD you own is illegal - even posting a link to circumvention software is enough to violate the DMCA. Web sites got C&D orders for hosting a number. Dmitry Sklyarov was arrested for writing software. If those examples don't seem ludicrous enough, there are plenty more.


I'd say plethora is wrong at least in US. Ridiculous retroactive copyright extensions would be my main gripe (though I doubt Grooveshark has any works that are about to become public domain). Or creative accounting that makes artist indebted even if their song is sold in millions.

Also I have a suspicion that most people use Grooveshark as a form of radio in such way that it doesn't really feed on artists main source of profit (CDs and concerts).

However don't take this out of context I still dislike lack of any mechanisms for artist reimbursement.


Dr. King once said "One has not only a legal but a moral responsibility to obey just laws. Conversely, one has a moral responsibility to disobey unjust laws."

I have to think he meant it in a different way, but it's still something I believe to be true. The laws regarding IP and copyright are obviously broken. I hope the record labels are missing out on enough money to go bankrupt, they've certainly worn out their good will and outgrown their usefulness in this digital world.


I'm generally against copyright infringement/intellectual property theft. I guess I was just trying to say I want more legal services like this.

You have some great points. I haven't had a chance to use spotify.


I like Spotify a lot more regardless of the copyright issues. The added bonus is that Spotify is okay in the eyes of the people who own the music I'm listening too.

You should really try it out.


Every time I give it another try, so far, it's been missing about half the songs I'd like to listen to.

Additionally, on my last tryout, they required a Facebook ID for the free demo--not having Facebook, that's where the experiment ended.




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