Hence, cell phone carriers do not have to pay royalties to music publishers every time a customer's ringtone plays:
In her ruling, US District Judge Denise Cote pointed out that the carrier has no way to control when a ringtone is being played and earns no revenue when it happens -- customers decide when and where their phones can ring, and they turn the phone on or off without the carrier's consent. She also said that performing a work publicly usually means that it must take place in a public space where a "substantial number of persons outside of a normal circle of its social acquaintances is gathered."
Regardless, Cote says that mobile carriers are only responsible for the transmission of the song to the phone, which doesn't count as a performance in and of itself. "Even if the customer could listen to the download as it was being received, and contemporaneously perceive it as the musical work, that would not constitute a public performance," wrote the judge. Additionally, there is no expectation of profit on the part of the carrier or the customer when the phone begins blasting Cher out of its tiny built-in speaker. This means even if it was a performance, it would be exempt from falling under royalty requirements.
