French Group Seeks Royalties On IPod

PARIS (AP) -- A French association representing recorded music rights holders threatened Wednesday to take Apple Computer Inc. to court in a dispute over lost music royalties.

The argument centers on a fee levied in France on sales of blank CDs, tapes, hard disks, and other hardware that can be used to copy music. The proceeds go to musicians and other rights holders who lose money to piracy.

The Society of Music Creators, Composers and Publishers, or Sacem, accuses Apple of consistently refusing to pay the levy on sales of its iPod music player, which contains a hard disk drive.

In a statement, Sacem said that unless Apple settles its growing account, the agency that collects the payments "will have no other option than to go immediately to court to make sure that the rights of artists, composers and producers are respected."

Efforts to get comment from Apple's French subsidiary or its California headquarters were not immediately successful.

Apple's pocket-sized iPod player can download and store up to 10,000 music tracks from a home computer and play them back from its hard disk through headphones or an amplifier and speakers.

The French royalties levy came into force in July 2002 and taxes hard disks built into music players according to their size.

The levy on a top-of-the range iPod, which retails at 550 euros ($677) at French department store FNAC, would come to 20 euros ($24.63). Sacem estimates that Apple sold 20,000 iPods in France last year, with disk capacities ranging from 10 to 40 gigabytes.

In 2003, the society collected some 150 million euros ($185 million) in levies on hard disks and blank media sales on behalf of artists and other rights holders.