Spotify is in the process of being sued by PacketVideo for infringement of a music streaming patent. Could this mean Spotify will have to pull out of the US market just two weeks after its stateside launch?
PacketVideo claims that Spotify is infringing its “Device for the Distribution of Music in Digital Form” patent, which the company has held since 1997. It says Spotify was informed of this breach back in May – ahead of the US launch of the streaming service – but ignored the allegation. We’re not sure of the precise nature of the infringement here, but it could mean a ban for Spotify in the US, or force the company to license out the technology from PacketVideo. This would incur – most likely significant – royalty payments. Spotify contests the claim.
PacketVideo is a software company, offering media streaming solutions for mobile phones and home entertainment devices, among other things. It already has license agreements with other companies, including Verizon Wireless (its software powered the V Cast music service), suggesting its claim may have some weight. PacketVideo’s action accuses Spotify of "willful" infringement of the patent and seeks a permanent injunction plus triple damages – tripling any fines just for being so cocky, essentially.
Spotify launched in the UK on 10 February 2009, but only opened its doors to US folk two weeks ago. For those 18 months, it has been the key service we UK tech fans could brag about to American friends, their Netflix and Hulu accounts turning us green with envy. Our worry is that this action could have ramifications for Spotify’s UK operations too. Both the Luxemborg and UK operations have also been implicated in the lawsuit, and if our Spotify streaming goes offline, we won’t be happy.
Spotify offers unlimited music streaming of more than 15 million songs for a flat subscription fee off £4.99 a month in the UK. The Premium £9.99 account also enables streaming to a mobile and offline playlists, so you don’t have to stay connected all the time.