The RIAA is going after one of its largest paying customers, XM Radio. The RIAA claims that XM’s new product under the Inno name is too much like an MP3 player or an MP3 recorder and therefore is not covered under XM’s current arrangement whereby XM pays to broadcast music. The music industry wanted XM to pay a similar rate such as is imposed on Apple and Sirius (XM’s largest competitor) for the download of music in addition to the broadcast. XM feels that the recording industry is trying to double charge its customers, who pay $12.95 per month and under XM’s vision would not have to pay for a download.

“The lawsuit seeks $150,000 in damages for every song copied by XM Satellite customers using the devices, which went on sale weeks ago. The company said it played 160,000 different songs every month.” This quote out of the New York Times is slightly out of context as XM does state that it broadcasts 160,000 songs each month, but does not say how many songs are being recorded onto these devices.

XM has apparently ruffled some feathers with one of its most important partners, the RIAA. XM had attempted to play nice with the RIAA, this lawsuit seems to indicate a severe breakdown between the partners. Maven Mapper’s next line of inquiry will be to review XM’s financials and compare them to Sirius who by recent accounts has agreed to pay the RIAA the fees they seek.

Its curious that Sirius has accepted this and XM has fought it now all the way to court.

Recording Industry Sues XM Satellite Radio – New York Times