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Bombay High Court rules that compulsory licenses for songs are not applicable to internet services

If you are a music lover who enjoys streaming songs online, you may be interested to know that the Bombay High Court has recently passed a judgment that affects the way music is licensed and distributed on the internet. The court held that compulsory licenses, which allow anyone to broadcast copyrighted songs upon paying a fixed royalty, are only applicable to traditional platforms like radio and TV, and not to internet-based services like Wynk.

What are Compulsory Licenses?

Compulsory licenses are a legal mechanism that enables the public performance of musical works without the need to obtain the consent of the original owners. Under Section 31D of the Copyright Act, 1957, anyone who wants to play a song in public can do so by informing the owner and paying a prescribed royalty to the Copyright Appellate Board.

Compulsory licenses are meant to balance the interests of the creators and the users of music, and to promote the dissemination of culture and entertainment. They are also limited to non-dramatic musical works, which means they cannot be used for musicals, operas, or soundtracks3.

What was the Dispute between Wynk and Tips?

The dispute arose when Wynk, a digital music app owned by Airtel, failed to renew its agreement with Tips, a music label that owns the rights to many popular songs. Tips demanded that Wynk stop using its songs without its permission and without paying any royalty. Wynk refused to comply and claimed that it had a statutory right to broadcast Tips’ songs under Section 31D1.

What is Section 31D of the Copyright Act in India?

Any broadcasting organisation desirous of communicating to the public by way of a broadcast or by way of performance of a literary or musical work and sound recording which has already been published may do so subject to the provisions of this section.

Tips then filed a suit against Wynk in the Bombay High Court, seeking an injunction and damages for infringement of its rights. The single judge ruled in favor of Tips and held that Wynk’s activities did not fall within the scope of Section 31D. The judge observed that Wynk was not merely broadcasting songs, but also allowing users to download and store them offline for a fee. This amounted to commercial rental, which was not covered by compulsory licenses.

Wynk appealed against this order before a division bench of the Bombay High Court, which upheld the single judge’s decision. A division bench consisting of Justices GS Patel and Gauri Godse agreed that Section 31D was restricted to traditional non-internet-based platforms like radio and TV, and not to internet-based services like Wynk. The bench noted that internet services gave users more control and choice over the content they accessed, unlike radio and TV, which provided content in a linear and passive manner.

What are the Implications of this Judgment?

The judgment has significant implications for the music industry and the online streaming market in India. It clarifies that compulsory licenses are not available for internet services, and that they must obtain licenses from the owners of the songs they wish to use. This means that internet services must negotiate with music labels and pay them royalties based on mutually agreed terms. This could increase the costs for internet services and affect their profitability.

On the other hand, the judgment also protects the rights and interests of music owners, who can exercise more control over their works and demand fair compensation for their use. This could encourage more investment and innovation in the music industry and benefit both the creators and the consumers of music.

The judgment also sets a precedent for other cases involving similar issues of compulsory licensing and internet services. It is likely that other courts will follow the Bombay High Court’s interpretation of Section 31D and apply it consistently across different platforms.

The judgment also raises some questions about the adequacy and relevance of Section 31D in the digital age. It may be argued that Section 31D is outdated and does not reflect the changing realities of technology and consumer behaviour. It may be suggested that Section 31D should be amended or replaced by a more comprehensive and flexible framework that can accommodate different types of platforms and services.

In conclusion, the Bombay High Court’s judgment on compulsory licenses for songs is an important one that has far-reaching consequences for the music industry and the online streaming market in India. It clarifies the scope and applicability of Section 31D and establishes that internet services cannot claim compulsory licenses for playing songs. It also highlights the need for a more modern and adaptable legal regime that can address the challenges and opportunities posed by new technologies and modes of communication.


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