Warning over karaoke prices amid label row

PUBLISHED : Friday, 16 April, 2010, 12:00am
UPDATED : Friday, 16 April, 2010, 12:00am

Leading karaoke chain Neway, embroiled in legal actions brought by three record labels over alleged copyright infringements, warned yesterday that karaoke-goers would have to pay substantially more for their entertainment because the music companies had doubled the fees they were charging Neway.

It will take the issue to the Copyright Tribunal for a judgment on reasonable licensing fee levels. In a newspaper public announcement, Neway also said 'the disproportionately high' licence fees charged by the three labels had undermined the viability of its newly acquired former rival, California Red Karaoke Box.

A few of its karaoke establishments have been closed since the takeover of California Red.

The unnamed record labels are believed to be Sony Music, Universal and Warner, which have launched legal actions against the karaoke chain. Neway Karaoke Box has owned 90 per cent of Hong Kong's karaoke industry since it took over California Red last month.

The company's announcement said that although it had already paid licence fees up to double the previous levels, the labels were pursuing proceedings against it.

It said public performance licence fees it paid to new licensing bodies set up by the record labels were double what it paid the previous licensing body. Fees for old songs, under the karaoke server licence, had also been increased substantially.

Neway said licence fees had been raised since the three labels set up the Hong Kong Recording Industry Alliance to handle copyright issues for them after they had opted out of the Phonographic Performance (South East Asia) body under the International Federation of the Phonographic Industry.

Neway is being sued by Sony Music and Universal Music over alleged copyright infringements by its 23 bars in the city in two actions filed in the Court of First Instance early this month.

A similar claim from Warner Music was launched in February.

The karaoke chain said the licence fees were disproportionately higher than other karaoke entertainment providers had to pay.

Neway said it was applying to the Copyright Tribunal to ask it to determine reasonable licence fee levels and terms and it hoped that the dispute would be resolved.

Neway, Sony and Warner declined to comment yesterday. Universal could not be reached.

Early this month, Sony Music and Universal filed two writs in the High Court seeking an injunction to restrain Neway Karaoke Box and 27 other companies from infringing their copyright works. They are seeking damages and an order requiring Neway to hand over or destroy all infringing copies. The writs do not provide any details of the scope of the alleged infringement or the amount claimed.

The Universal Music action is jointly brought by UMG Recordings, Interscope Records, Polydor, Universal Music and Cinepoly Records.

The Warner case hearing is set for April 22.No hearings have been set for the Sony and Universal case.