Internet music streaming bad-boy Grooveshark is back in trouble again today as EMI have said that the company has failed to pay its bills to the record label. EMI was the only of the big four major labels to have agreed a deal on streaming rates with Grooveshark, so this non-payment is the service going back into the cold completely again when it comes to streaming a large proportion of popular music.
Grooveshark had signed a promissory note back in November 2011 to pay Capitol Records (an EMI subsidiary label) $450,000 in accordance with a prescribed schedule. Part of that schedule was a $100,000 payment on March 15th, a sum which has not been paid. In fact, EMI says Grooveshark has not made any payments to the label at all.
For its part, Grooveshark is claiming that it cancelled the agreement with EMI on the basis of the proposed takeover from Universal which they claim would be monopolistic, and that the streaming rates EMI were asking for were too high. Now, whilst the issue of unworkable streaming rates may be valid, it is strange that Grooveshark would sign an agreement to those rates only to renege on that deal once it came to payment time.
Grooveshark claims to support artists and rights holders, but if they still aren;t paying the record labels this is getting harder and harder to believe.