BMI Collection Agencies Turn To Ring Tones To Collect Royalties

It seems as though record companies have developed a new game plan in order to collect royalties. As we all know, the music industry attempted to sue individual users who illegally downloaded songs. But because of this approach to recover from major fiscal loss has destroyed their public image.

In lieu of lowering the price of albums in order to go up against the free music circulating through the internet, the music industry has turned to collection agencies who are now taking legal action against cellphone companies over royalties from ring tones. They claimed that ring tones counted as public performances so cell phone companies should be obligated to pay performance fees. The courts quickly renounced this claim.

Despite this unsuccessful attempt to collect on royalties, Broadcast Music Inc is now suing T-Mobile over ring back tones, claiming that the mobile carrier is selling them without licensing agreements. Unlike ring tones, which play out loud when someone calls a cellphone, ring back tones play specifically to the person calling. In other words, instead of hearing a cellphone dialing, the caller will hear a song that was chosen by the cell owner.

Critics are quick to point out the apparent irony of this lawsuit. If ringtones, which can be heard by anyone around a cellphone, do not constitute public performance, it seems ludicrous to sue the mobile carriers over a ringback tone that can be heard only by the caller. With record companies suffering from huge financial losses, it seems as though they are grasping at straws in order to collect any money that they possibly can.

It does not seem that lowering the cost of CDs and DVDs is an idea that has occurred to the major companies. There are still a number of music fans out there that prefer to collect and own the media, however with prices constantly spiking, downloading music for free seems very tempting. CDs generally go on sale for about seventeen dollars.

Specific bands have been skirting the issue of music downloading through unique tactics. Radiohead, an alternative rock band, established a website where fans can download the music for free, or for a donation. Nine Inch Nails’ Trent Reznor has followed suit. With record companies’ unsuccessful lawsuits and declining public image, it seems as though thinking outside of the box and fair pricing may be more effective than bullying money out of mobile carriers and individual users.

Mallory McGuinness-Hickey works for debt collection company Rapid Recovery Solution and writes free lance pieces on financial news.