Rental Car Stereos Infringe Copyright, Music Rights Group Says

Renting a car is something that millions do every year but if an industry group gets its way a portion of hire revenue will soon be hitting the music industry. Swedish collection outfit STIM says that car stereos perform music to the public and as a result rental companies are breaching copyright if they don't have a suitable license.

Car rentals are big business. According to Car Rental Market – Global Industry Analysis, Size, Share, Growth, Trends and Forecast, 2013 – 2019, the global car rental market was valued at $36.89 billion in 2013. In the US alone an estimated 2.07m vehicles are available for hire.

Over in Europe, the second largest market next to North America, a storm is brewing. Up in the north of the continent Swedish music rights outfit and car rental company Fleetmanager are locked in dispute over the latter’s business, specifically how the company provides car rental customers access to music.

STIM (Svenska Tonsättares Internationella Musikbyrå) is a collecting society for songwriters, composers and music publishers. It demands license fees whenever its members’ music is broadcast or transmitted, and collects sizable revenues from music streaming service Spotify. STIM also ensures that its members are paid when their music is played in public and this is at the heart of the dispute with Fleetmanager.

Each car rented out by Fleetmanager contains a stereo radio and CD player so that the customer can enjoy broadcasts of all kinds, including music. STIM says that to do so legally Fleetmanager needs to obtain a license but to date has failed to do so.

According to SVD, STIM is arguing that the inside of Fleetmanager’s cars contain members of the public and therefore amount to public places. On this basis the company needs to obtain a public performance license. Fleetmanager disagrees, noting that any music played inside a car is only heard by a limited circle of people.

STIM disagrees. The collection society says that previous cases involving hoteliers have ended with licenses being obtained which enable hotel guests to listen to music while on the premises. Furthermore, other car rental companies in Sweden have already agreed to pay a per-stereo levy so Fleetmanager should also pay, STIM argues.

This is not the first music-related copyright case to hit the car sector this year. In July, the Alliance of Artists and Recording Companies launched a class action lawsuit against Ford and General Motors over the CD-ripping capability of their cars. In November the group followed up with fresh legal action against Chrysler and technology partner Mitsubishi.

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