EMI may cut funding for RIAA, trade groups

By Ed Oswald, BetaNews

November 29, 2007, 2:10 PM

The future of the fight against piracy may be a lot less certain following rumors that music label EMI would like to make cuts in the funding of trade groups.

The four major music publishing labels -- EMI, Warner, Sony BMG, and Universal -- reportedly make regular payments to international representative groups such as IFPI and the RIAA. IFPI alone gets about $132 million a year from the four publishers, and that amount could be similar for RIAA, although no data was available.

Much of these funds are used to combat the growing problem of piracy. Without it, these groups' ability to launch legal action could be severely hampered. Out of the four, EMI is generally seen as the least concerned about the problem considering its recent actions, so if it does move to back out, it may not be all that surprising.

Either way, analysts see any cut in funding to these groups as negative for the industry overall, considering that the industry is only just now starting to see progress.

None of the labels would comment on the situation, although Reuters said today that at least one of the labels is said to strongly support the work of these groups. That is likely Universal, which has taken the strongest stance against online piracy.

EMI is currently undergoing restructuring following a buyout by a private equity firm. These investors could see the overall fight against piracy as a net negative to the company's bottom line, and may be looking for a way out.