whether a particular activity is “interactive” must be determined on a case by case basis upon a
full evidentiary record.^3244
(a) Arista Records v. Launch MediaIn Arista Records, LLC v. Launch Media, Inc.,^3245 the Second Circuit, affirming a jury
determination, held that the LAUNCHcast webcasting service was not an “interactive” service
within the meaning of Section 114(j)(7) as a matter of law,^3246 and Launch Media could therefore
rely on the statutory license for public performances via digital audio transmissions. The
LAUNCHcast service enabled a user to create “stations” that played songs within a particular
genre or similar to a particular artist or song the user selected. Specifically, upon registering
with the service, the user would select artists whose music she preferred. The user would then
list genres the user enjoyed and rate them on a scale. The user was also asked the percentage of
songs the user had not previously rated the user would like to incorporate into the user’s station
(the “unrated quota”). The minimum unrated quota was 20%. Once LAUNCHcast began
playing music based on the user’s preferred artists and genres, the user would rate the songs,
artists, and albums played between zero and 100. Below the rating field were hyperlinks termed
“history,” “share,” and “buy.” The history hyperlink allowed the user to see a list of the songs
previously played, and the buy hyperlink facilitated the user’s purchase of the songs. The share
hyperlink allowed the user to share the station with other users. That feature facilitated the
subscription of one user to another user’s station. While a song played, the user had the ability to
pause the song, skip the song, or delete the song from the station by rating it zero. The user was
not able to go back to restart a song that was playing, or to repeat any of the previously played
songs in the playlist.^3247
Each time the user logged into the LAUNCHcast service and selected a station, the
service generated a playlist of 50 songs selected from a hashtable of potential songs that could be
put into the playlist. The hashtable was generated using a very complicated algorithm that took
into account numerous variables, only some of which included the user’s preferred artists and
genres and unrated quota.^3248 Although the playlist generated each time a user selected a radio
station was unique to that user at that particular time, the Second Circuit determined that the
playlist was not “specially created for the recipient” via an interactive service within the meaning
of Section 114(j)(7). Based on an extensive review of the legislative history of Section 114(j)(7),
the court noted that Congress’ primary concern both in creating a performance right in digital
audio transmissions and in excluding interactive services from the statutory performance license
was to protect sound recording copyright holders from diminution in record sales. Congress
believed that interactive services, by providing predictability based on choices by the user, could
approximate the predictability the music listener seeks when purchasing music, thereby
(^3244) Id. at 77332.
(^3245) 578 F.3d 148 (2d Cir. 2009), cert. denied, 130 S. Ct. 1290 (2010).
(^3246) The court ruled that the issue of interactivity presents an issue of law. Id. at 151-52.
(^3247) Id. at 157-58.
(^3248) Id. at 158-59.