XM Settles with Universal

XM Satellite radio has reached a settlement with Universal Music over the recording capabilities of its Inno portable player.

XM Satellite Radio—still working on its mega-merger with Sirius—has reached a settlement with Universal Music over the recording capabilities of the Pioneer Inno portable player…however, the companies are not disclosing the terms of the arrangement.

The lawsuit over the Inno player was filed back in May of 2006; the device can record up to 50 hours of satellite radio programming. Record labels—including Universal Music and Warner Music Group—argued the recording capability amounted to "outright infringement," since the licenses the labels have granted XM allow for broadcast only, not distributing digital copies of their artists’ music. The suit sought $150,000 in damages for every song copied by Inno owners to their devices, although the plaintiffs sought to extract the money from XM Satellite Radio, rather than the customers themselves.

Universal’s settlement with XM also includes a multi-year deal that supports XM radios with recording technology, including the Pioneer Inno as well as future devices with radio-recording capability.

"Our agreement is a win for everyone involved, especially for consumers," said XM president and CEO Nate Davis, in a statement. "Today’s announcement underscores the fact that XM competes in an audio entertainment market in which consumers have more options than ever. We commend UMG for being the first music company to take this step forward with us and look forward to continuing our discussions with our other partners in the music industry."

XM still faces legal action from other major music distributors, although recent weeks have brought persistent rumors Warner Music Group is in talks with the satellite radio operator.