Gracenote Inks Deal to Offer Lyrics

Gracenote, which provides an index of album and song information to music services and software makers, has signed an agreement with numerous record companies that gives it the license to distribute lyrics for over 1 million songs in North America.

The deal is the first effort by the music industry to offer lyrics legally; currently, hundreds of Web sites on the Internet provide song lyrics, but do so without authorization. The news comes as record labels are planning a crackdown on such sites, mulling lawsuits over copyright infringement.

Gracenote says it has begun to talk with its technology partners about offering lyrics to their customers. For example, Apple's iTunes and Yahoo's Music Unlimited services could bundle lyrics with digital album purchases, much in the same way digital booklets are currently provided.

Bertelsmann AG's BMG Music Publishing, Vivendi's Universal Music Publishing Group, Sony/ATV Music Publishing, Peermusic and numerous other smaller record labels are among those companies that will work with Gracenote's new lyrics service.

No financial terms of the deal were disclosed, and Gracenote did not say how it planned to charge its partners for lyrics. However, Gracenote Senior Vice President Jim Hollingsworth said the music services will be able to choose whether or not to charge their customers for the added feature. The company expects any costs to be low.