Print 38 comment(s) - last by jimbojimbo.. on Apr 1 at 11:06 PM

Record labels are upset over Amazon's Cloud Drive announcement when the online retailer failed to address license-related negotiations

Just yesterday, Amazon announced its new cloud-based storage service called Cloud Drive, which is quite a feat considering the online retailer jumped ahead of huge tech companies like Apple and Google in the race for music streaming services. But now, the music industry is stepping in, and could possibly slow Amazon's progress.  

Cloud-based music storage has become a popular option for those who use multiple devices. For companies like Amazon, this method of music streaming is a great alternative to relying on CD sales. While other companies continue working on their versions of cloud-based services, such as Apple's MobileMe music component called a "locker," and Google's music service that was rumored to be released with the new Honeycomb launch (but reports are now saying that Google execs are still in the midst of chatting with record labels), Amazon leaped ahead of the game with Cloud Drive, which offers 5 GB of online storage for free and saves album or MP3 purchases to the cloud automatically.

Customers can upgrade to 20 GB of space by purchasing an MP3 album. Also, the Cloud Player allows users to play their music through a PC, Mac or Android-based phones. However, those with an Apple iPhone cannot partake in Amazon's new service.

But now, Amazon may be running into some trouble with record labels, like Sony Music, who was angered by Amazon's new service launch "without new licenses for music streaming." 

"We hope that they'll reach a new license deal," said Liz Young, a spokeswoman for Sony. "But we're keeping all of our legal options open."

Record labels were informed of the new Amazon service last week, and Amazon had not yet addressed license-related negotiations at that point. An executive close to the Amazon discussions, who preferred to remain anonymous due to the confidentiality of the discussions, noted that Amazon's new service might be considered illegal to those in the music industry.  

"I've never seen a company of their size make an announcement, launch a service and simultaneously say they're trying to get licenses," said the executive. 

While users are allowed to store music files on their own computers, it is "unclear whether they have that right when they use remote storage services offered by cloud computing." 

A similar situation occurred in 2007 when EMI sued MP3tunes because they offered a service similar to Amazon's.  

"The labels have engaged in a legal terror campaign over the last 10 years using litigation to try and slow technology progress," said Michael Robertson, MP3tunes founder, regarding the Amazon situation.

Comments     Threshold

This article is over a month old, voting and posting comments is disabled

RE: Gotta love it
By brybir on 3/30/2011 10:59:20 AM , Rating: 2
Except the fact is that when I buy an MP3 from Amazon, I am downloading a real, validated and working MP3 file that I can do whatever the hell I want with it.

Other posters have pointed out that I can sign up for dropbox or any other hosting site, move my MP3 to that site, and stream it to the cloud in any way that I please and I am perfectly within my rights.

All Amazon is doing is giving me the option to have my MP3's, that I could otherwise download and DO WHATEVER I WANT WITH THEM, to be placed in my cloud ahead of time.

The only reason the record companies think that this is against some terms and agreements is because they see streaming music as distint from buying and downloading a music, i.e. the difference between the zune marketplace $10 all song you want and your 99 cent amazon downloads. The difference being, to the labels, they will charge MS a very small fee per song (say 3 cents) per song streamed, because you dont get to keep it and so they make money over time as you listen to songs repeatedly or even go out and buy the song later at full price. I imagine the labels see this and say, oh no they are getting to download the song AND get free streaming of the song as well, and we did not negotiate that with Amazon, and because we always get extra revenue for streaming as opposed to downloading, we are missing our share of the money.

My opinion is that this is nothing more than a contract dispute, it is not a question of "rights", but, what did the labels and Amazon sign in their contract about streaming. My guess is the contract has a few pages talking about streaming music being seperate, and basically Amazon is saying this is NOT streaming as discussed above, merely storage that happens to have a player in it, so it is not covered by the contract. But, without copies of the contract, it is hard to know.

Realistically, this was a very smart move from Amazon. They needed an edge to keep up competitively with Apple, and this just provided them a large innovation that Apple that does not have and that many people, like me, are excited about. I'm just suprised Google did not offer it sooner.

RE: Gotta love it
By cochy on 3/30/2011 11:58:26 AM , Rating: 3
The only reason the record companies think that this is against some terms and agreements is because they see streaming music as distint from buying and downloading a music

In other words, the record companies are clueless. Old news.

RE: Gotta love it
By kraeper on 3/30/2011 2:28:00 PM , Rating: 1
For the record, having an mp3 file does not give you the legal right to "DO WHATEVER I WANT WITH THEM". For example, you cannot broadcast it in public, you cannot upload it to bittorrent, you cannot give copies to friends, etc etc etc. Sure the technology exists, but that does not give you the legal right to use it.

Yes I hate record companies, yes this 'dispute' is all about money, and I hope they lose this (currently non-existent) case, but "I can already do that!" isn't a valid legal defense. Owning a gun does not give you the legal right to shoot whomever you'd like either.
Just sayin.

"I want people to see my movies in the best formats possible. For [Paramount] to deny people who have Blu-ray sucks!" -- Movie Director Michael Bay

Most Popular Articles5 Cases for iPhone 7 and 7 iPhone Plus
September 18, 2016, 10:08 AM
Laptop or Tablet - Which Do You Prefer?
September 20, 2016, 6:32 AM
Update: Samsung Exchange Program Now in Progress
September 20, 2016, 5:30 AM
Smartphone Screen Protectors – What To Look For
September 21, 2016, 9:33 AM
Walmart may get "Robot Shopping Carts?"
September 17, 2016, 6:01 AM

Copyright 2016 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki