Mobiles and content and media are all but ubiquitous these days, showing up everywhere and on every mobile handset in some shape or form. Of course, this is partly due in no small part to mobile phones themselves getting better and better at performing their appointed tasks of making our lives easier by streamlining our tasks and workload – allowing them to take on more “optional” tasks such as load, support and distribute more and more mobile content and media as things develop. Mobile content has entrenched itself as a popular commodity across market brackets and even age groups, with its many types and topics.
Mobile music in particular has emerged as a strong commodity. Entertainment companies have worked closely with the mobile industry to spawn programs and promotions that have surrounded new artists, albums and properties. Mobile content has been churned out at a fairly regular clip and a high rate, resulting in scores of mobile users who have gladly paid for downloaded mobile content to help customize their mobile use and experience, or otherwise developed the means to create their own ringtones and wallpapers to reinforce the personal stake they already have in maximizing their enjoyment of the many available types of mobile content.
This has resulted in a robust mobile content industry with sales that are said to have peaked a couple of years now past, and plenty of adaptive measures undertaken by artists, mobile content providers and mobile distributors alike. It has also generated more than a few disputes on some fronts, one of the more recent of which ended with a notable conclusion and decision. This contest centered on the royalty structure on ringtones as well as the rates on late fees. The big question was mainly how much copyright owners should be making off of the use of their work, which is admittedly quite a concern for something as profitable and popular as ringtone sales.
The US Court of Appeals for the DC Circuit laid down a verdict on the royalty structure for ringtones, responding to the motion brought forward by the Recording Industry Association of America, who wished to get the royalty structure overturned and amended. The association argued for a percentage-of-revenue structure for royalties where copyright owners received 15% from each ringtone sale. Alternatively, the association proposed, a penny-rate royalty of 18 cents per ringtone would do. This was in response to the association’s judgment of the current penny-rate royalty structure was unfair, because of “plummeting ringtone prices.” The board’s decision, however, favored the penny-rate structure overt he percentage-based pay structure.
Judge Brett M. Kavanaugh wrote that [the RIAA] “failed to present any basis for us to overturn that conclusion.” The board, in Kavanaugh’s words, “examined the relevant data and determined that there was no meaningful link between the selection of a penny-rate royalty structure for ringtones and future ringtone revenues.” The proposal on late fees – the association had objected to the existing 1.5% late fee – received a similar decision from the board, as according to Kavanaugh the association was unable to raise an argument that sufficiently justified the proposal.
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