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Monday, 18 August 2008 05:54

Music royalties controversy continues

Written by David Stellmack

Image

Warner fires back at Activision again

The war of words continues between Warner and Activision over the royalties that should be paid for use of song licks in games Guitar Hero and Rock Band.

In the last round Activision suggested that the music industry should be compensated in the way that they would be for a performance of the music on a medium like iTunes. Of course, this did not rest well with Warner, who continues to suggest that games totally rely on the music content and are dependent on the content in order for the game to be viable.

While we are sure that Warner will continue to suggest that they are not receiving a big enough slice of the pie, in many ways they should be grateful that a new revenue stream has been realized in the video game market space in general, and the reality is that a significant amount of the music content is coming from catalog titles that were not generating the kind of revenue numbers that Warner would like to see with the drop off in music sales.

The war of words is sure to continue to with both sides being unhappy. Companies like EA and Activision are likely thinking that they are having to pay too much for the use of the music content and music companies like Warner suggesting that they are not getting a big enough slice of the pie. We have to think that the debate will continue to play out in a very public forum.

Look for music companies like Warner to explore the possibility of getting into the software business to generate content that makes use of their music content where they can generate more revenue that they don’t have to share with anyone else.

Of course, this will take time to develop, but short of this happening we have to believe that the war of words will be ongoing and music companies like Warner will continue to make songs available to developers, as the music industry needs to find new ways to continue to break ground in the digital realm and find new revenue streams.

In the meantime, more strange things continue in the music/video game segment with reports that a 16-year-old kid has dropped out of school to pursue a career playing Guitar Hero professionally. No, we really don’t make this stuff up!

Last modified on Monday, 18 August 2008 06:49
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