Spotify gets warm US welcome with a lawsuit
European digital music service Spotify has re-ignited the U.S. music business since it opened up shop on these shores two weeks ago. Hype and Twitter-based excitement have gone into over-drive as users have sought out valuable Spotify invites for the partly free on-demand music service.
It’s not been an easy ride getting here for Spotify and founder Daniel Ek (pictured, right). For one thing, there had been two years of testy, and presumably expensive, music licensing negotiations with the major record labels. Still, they got here, only to now find that one of the other common distractions of US technology business is threatening to spoil the party: A patent lawsuit.
Spotify was sued by PacketVideo Corp for patent infringement for of its United States Patent No. 5,636,276 entitled “Device for the Distribution of Music in Digital Form”. The suit was filed at the US District Court, Southern District of California on Wednesday (Case No: ’11CV1659 IEG)
As Techdirt, who covered this earlier, points out the patent is rather broad so other offenders could include everyone from Apple and Android to Nokia and Samsung.
Spotify, which said it has never before been sued in the United States or Europe, seems to see this as another minor marketing opportunity:
“In just under three years, Spotify has become more popular than any other music service of its kind. This success is, in large part, due to our own highly innovative, proprietary hybrid technology that incorporates peer-to-peer technology. The result is what we humbly believe to be a better music experience - lightning fast, dead simple and really social. PacketVideo is claiming that by distributing music over the Internet, Spotify (and by inference any other similar digital music service) has infringed one of the patents that has previously been acquired by PacketVideo. Spotify is strongly contesting PacketVideo’s claim.”
In the meantime, according to Billboard, Spotify signed up 70,000 paying subscribers in its first week. If correct, that’s a pretty significant number in a sector where the market leader Rhapsody took the best part of a decade to build up to 800,000 users.