On Mar. 9, 2001, prior to issuance of the 2001 DMCA report, and in response to a
petition by the RIAA for rulemaking or to convene a CARP, the Copyright Office initiated a
request for public comments on the interpretation and application of the mechanical and digital
phonorecord compulsory license to certain digital music services, including webcasting.^3268 The
RIAA petition focused on two types of digital music deliveries:
- “On-Demand Stream,” defined as an “on-demand, real-time transmission using
streaming technology such as Real Audio, which permits users to listen to the music they want
when they want and as it is transmitted to them”; and - “Limited Download,” defined as an “on-demand transmission of a time-limited or other
use-limited (i.e. non-permanent) download to a local storage device (e.g. the hard drive of the
user’s computer), using technology that causes the downloaded file to be available for listening
only either during a limited time (e.g. a time certain or a time tied to ongoing subscription
payments) or for a limited number of times.”^3269
Music publishers had taken the position that both On-Demand Streams and Limited
Downloads implicated their reproduction (mechanical license) rights. The RIAA requested the
Copyright Office to determine whether On-Demand Streams are incidental DPDs and, if so, to
convene a CARP to set rates for those incidental DPDs. With respect to Limited Downloads, the
RIAA suggested that they may be either incidental DPDs or more in the nature of record rentals,
leases or lendings.^3270 In either case, the RIAA believed that the compulsory license of Section
115 should apply, but asked the Copyright Office to conduct a rulemaking proceeding with
respect to the issues:
In sum, RIAA asserts that it is unclear whether the section 115 license permits all
of the activities necessary to make On-Demand Streams or Limited Downloads,
and if so, at what royalty rates. Consequently, RIAA petitions the Office to
determine (1) whether On-Demand Streams are incidental DPDs covered by the
license; (2) whether the license includes the right to make server copies or other“Just as webcasters appear to be facing demands for royalty payments for incidental exercise of the
reproduction right in the course of licensed public performances, it appears that companies that sell licensed
digital downloads of music are facing demands for public performance royalties for a technical ‘performance’
of the underlying musical work that allegedly occurs in the course of transmitting it from the vendor’s server to
the consumer’s computer.Although we recognize that it is an unsettled point of law that is subject to debate, we do not endorse the
proposition that a digital download constitutes a public performance even when no contemporaneous
performance takes place. If a court were to find that such a download can be considered a public performance
within the language of the Copyright Act, we believe that the arguments concerning fair use and the making of
buffer copies are applicable to this performance issue as well. It is our view that no liability should result from
a technical ‘performance’ that takes place in the course of a download.”Id.(^3268) 66 Fed. Reg. 14099 (Mar. 9, 2001).
(^3269) Id. at 14100.
(^3270) Id.