XM Settles With Warner Over Inno

From Peter Kafka, Silicon Valley Insider:

XM has settled a lawsuit with Warner Music over a portable XM device that lets users record music directly from the satellite radio service. Execs there won't talk about the settlement, but we can tell you that deal requires XM to pay WMG a fee for each "Inno" player it sells. Last week Universal Music Group inked a similar pact, which means that the satellite company still has to come to terms with Sony-BMG and EMI Group before it can extract itself from court proceedings.

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Universal Music Group (UMG) and XM Satellite Radio Reach Agreement on Pioneer Inno

From CNN Money:

Universal Music Group (UMG), the world's leading music company, and XM Satellite Radio, the nation's leading satellite radio company, today announced that they have resolved the lawsuit brought by UMG against XM over its Pioneer Inno, a portable satellite receiver with advanced recording functionality. The companies did not disclose terms of the deal.

As part of the agreement, UMG becomes the first music company to reach a multi-year deal covering all XM radios with advanced recording functionality, including both those currently available as well as future product releases. In addition, UMG will withdraw as a party to the complaint filed by the major record companies against XM in May, 2006.

"We are pleased to have resolved this situation in an amicable manner," stated Doug Morris, Chairman & CEO, Universal Music Group. "We pride ourselves on empowering new technology and expanding consumer choice. And XM is providing a new and exciting opportunity for music lovers around the world to discover and enjoy our content, while at the same time recognizing the intrinsic value of music to their business and the need to respect the rights of content owners."

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New Satellite Royalty Rates Fail to Reflect Full Value of Music

From Broadcast Newsroom:

While Dramatically Increasing Royalty Rate for Music on Satellite Radio, Copyright Royalty Board Still Sets Rates Below True Value

WASHINGTON, Dec. 4 /PRNewswire-USNewswire/ -- SoundExchange today expressed mixed reaction to the royalty rates announced by the Copyright Royalty Board (CRB) to be paid by satellite radio operators, XM and Sirius, to the artists and record labels whose music is the core of the satellite radio business. The decision dramatically increased the royalty rate paid by XM and Sirius, thereby validating the overwhelming evidence presented by SoundExchange regarding the critical importance of music to satellite programming.

The CRB also rejected virtually all of the evidence submitted by XM and Sirius. However, the congressionally-mandated standards that the CRB followed ultimately led it to set rates at half the value it determined artists and record labels would have received in the marketplace. "This result once again highlights the inequity of a rate standard that forces creators of music to subsidize certain music services with below market rates," said John Simson, Executive Director, SoundExchange, a non-profit organization that collects and distributes royalties from various digital music services on behalf of artists and record labels. "We are glad that the decision affirmed the importance of music to XM and Sirius, but disappointed that the rate standard led to a lack of full and fair compensation because of the business circumstances created by XM and Sirius," added Simson.

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