Japan’s largest supplier of karaoke music, Daiichi Kosho Ltd, said it would go out of business if its current success in supplying on-line karaoke services continued to all the clubs it currently serves, reports the International Herald Tribune. The problem lies in the government regulations concerning royalties payable to musicians for electronic distribution of karaoke, making karaoke-on-demand more expensive for the company providing the service. Daiichi Kosho has installed 20,000 of the $19,950 systems in six months out of the total 150,000 clubs it serves. The Japanese Society for Rights of Authors, Composers & Publishers sets the fees and has a monopoly and the Agency for Cultural Affairs supervises it and has ultimate authority. For now, Daiichi Kosho is putting aside, but withholding the extra fees due to the society for karaoke on demand. Meanwhile, negotiations are under way between the society and an association of karaoke music suppliers. Concern has been expressed over the regulations that could stunt the growth of multimedia services in Japan. In the case of karaoke-on-demand the rights society demands that suppliers pay $20 in monthly transmission fees for each club that is on line. This is in addition to the standard fees for mechanical and performance rights that apply to karaoke music and videos supplied on laser disk, a common medium used by karaoke clubs.
