Money & Business

Music Publishers Sue Over Unlicensed YouTube Covers

By Chris Brandon / Aug 14, 2013 Colombian performer Dicken Schrader, performing the Depeche Mode cover "Everything Counts." (YouTube screenshot)

An association representing music publishers has gone to court against a company that produces cover songs and uploads them to YouTube without paying royalties to the publishers and original songwriters.

In late 2011, a Colombian performer named Dicken Schrader uploaded a video to YouTube of him performing the Depeche Mode song “Everything Counts,” using an old keyboard and several household items as instruments. In the video, he pounds out the song’s rhythm by stomping on a Coke bottle, while his two adorable children, Milah and Korben, provide backing vocals and play a variety of trinkets, including a cheese grater.

The song quickly went viral and has since racked up 1.8 million views on YouTube, about the same number as Depeche Mode’s original version uploaded by their record label, Warner Bros. Records. Schrader and his kids have recorded five other Depeche Mode songs, dubbed themselves DMK, and performed on a handful of television programs.

The only problem? Cover songs like the ones DMK posts on YouTube are not licensed by the music publishers, and now those publishers are singing a sad song.

Big hits on YouTube

Cover songs have become so popular on YouTube that they’ve inspired a cottage industry with the potential to earn millions of dollars in ad revenue. One of the top players in that space is Fullscreen, a multichannel network, or MCN, that represents thousands of performers on YouTube.

Fullscreen scouts for talented performers on the site, helps them promote their videos, and—this is the part getting them into trouble with music publishers—connects them to premium ads that run with their videos. On its website, Fullscreen says its YouTube channels have 200 million subscribers and its videos receive 2.5 billion views each month.

Many of Fullscreen’s clients are amateur musicians who perform cover songs to build a fan base. If you search YouTube for Taylor Swift’s hit song “I Knew Your Were Trouble,” you’ll get the original and an earnest acoustic version by one of Fullscreen’s artists, Tyler Ward. Some Fullscreen artists go on to record original songs.

About the lawsuit

Last week, a group of music publishers represented by the National Music Publishers’ Association (NMPA) sued Fullscreen in U.S. district court claiming its cover songs infringe on their copyrights. The lawsuit claims that Fullscreen lacks the proper licenses and does not pay publishers and songwriters the royalties earned from ad revenue. The publishers represented include Warner/Chappell Music, a division of Warner Music Group, and several independents.

In a statement, NMPA said the lawsuit “is a signal to the industry that copyright infringement and unlicensed use of works in videos must stop.”

According to a story in the New York Times, the publishers and Fullscreen were attempting to reach licensing deals, but a breakdown of those negotiations prompted the lawsuit. NMPA, however, announced that it had reached a licensing agreement with Fullscreen’s rival, Maker Studios. Earlier this year, both Fullscreen and Maker Studios announced licensing deals with Universal Music Publishing Group.

Chris Brandon

Christopher Brandon is a contributor to Associations Now. More »

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