Photo Courtesy of Billboard
A group of music publishers, including Warner/Chappell Music, are suing Fullscreen Inc., a multi-channel network (“MCN”) that creates, distributes, and markets videos on YouTube. The publishers, represented by the National Music Publishers Association (“NMPA”), claim that the network’s videos comprised of unofficial covers of popular songs infringe on publishers’ copyrights.
Fullscreen’s website specifies that its MCN garners at least 2.5 billion monthly views, 200 million subscribers, and manages 15,000 YouTube channels. Fullscreen produces much of its own content, and its unlicensed music videos covering popular songs are amongst the most-watched.
According to the suit filed on August 6th in the US District Court of the Southern District of New York, the NMPA is claiming that hundreds, if not thousands of videos disseminated over Fullscreen’s network infringe on the publishers’ musical works. Further, it alleges that Fullscreen directly profits from advertising revenue that the cover videos generate without compensating the publishers and that the company and its founder, George Strompolos have “willfully ignored their obligation to obtain licenses and pay royalties to the vast majority of the musical content disseminated over Fullscreen’s networks.”
Arstechnica explains that artists can pay 9.1 cents per copy of a song to create and distribute cover songs via units of recorded music without permission from the original artist, referred to as a “mechanical license.” To create a cover in a music video, though, a “synchronization license” is required from the music publisher.
David Israelite, NMPA president and CEO, maintains that “the problem of copyright infringement and unlicensed use of music is endemic to the MCN industry” and “Fullscreen’s success and growth as a digital business is attributable in large part to the prevalence and popularity of its unlicensed music videos.” The NMPA holds that this lawsuit will signal to the industry that copyright infringement and unlicensed use of works in videos is an unacceptable practice and must stop.
The New York Times highlights that licensing issues regarding YouTube can be “confusingly opaque,” exemplified by the fact that where YouTube is responsible for managing the licensing and royalties of directly loaded, user-generated content, it frequently delegates that responsibility to MCNs. Rolling Stone reports that an agreement between Universal Publishing, Fullscreen, and Makers Studios (an MCN) to split advertising revenue from YouTube videos was announced in February of this year, which suggests that the present lawsuit was prompted by the breakdown of similar licensing negotiations.
This lawsuit intimates that in the ever-evolving world of online music, licensing and royalty issues may target MCNs as opposed to YouTube, and hold them accountable for any copyright infringement.