Yahoo! China ordered to pay record companies

Yahoo! China has lost a lawsuit filed by 11 major record companies, in which it was accused of playing 233 pieces of music, as well as providing access to free downloads of the tracks, owned by the record companies without their permission.

The Beijing Second Intermediary Court on Tuesday ordered Yahoo China to pay 200,000 yuan (US$27,200) in damages to the 11 companies which include EMI, Warner Music, Sony BMG Music Entertainment and Universal Music Group. It also told Yahoo China to delete the links to the free download websites.

The record companies launched the court proceedings in early January, demanding 5.5 million yuan (US$712,000).

Yahoo China insists that, as a search engine, it only provides links in its music search results and should not be held responsible for the content of third-party websites.

Xu Yang, Yahoo China's publicity director, said Yahoo China planned to appeal.

"Baidu.com was cleared of similar charges last year. If any mistake has been made, Baidu made the same one. The cruxes of the argument in the two cases are similar," he said.

Last November, Baidu.com, one of China's largest Internet search engines, won a similar lawsuit launched by seven companies, led by the International Federation of the Phonographic Industry (IFPI), charging Baidu with helping users to download music illegally.

Beijing's First Intermediate Court ruled that Baidu's service, which provides web links to the music, does not constitute an infringement as all the music is downloaded from web servers of third parties.

The record companies have appealed to a higher court after losing the lawsuit, but the ruling has yet to be made.

Baidu argued that the MP3 search engine it provided was the same as other search engines providing links to web pages, news and pictures.

It said it searched all music file formats through the Internet, such as ".mp3" or ".wav", making no distinction between copyrighted and pirated songs.

"If the music companies had won, the whole search engine sector would have ground to a halt," a Baidu spokesman said at the time.