Grooveshark shuts down: Sued out of business by the recording industry.

Music-Streaming Site Grooveshark Gets Sued Out of Business

Music-Streaming Site Grooveshark Gets Sued Out of Business

Moneybox
A blog about business and economics.
May 1 2015 11:56 AM

Music-Streaming Site Grooveshark Gets Sued Out of Business

Dead Grooveshark
Poor Grooveshark.

Photo illustration by Slate. Photo by craig clarke/Thinkstock.

Grooveshark, the music-streaming site that first popped up in the mid-2000s and once boasted 35 million users, has been sued out of business. On Thursday, the company announced it was shutting down after failing to secure licenses for the music it hosted. “That was wrong. We apologize. Without reservation,” the company wrote in a statement on its otherwise blank website.

Under the terms of a settlement reached with Universal Music Group, Sony Music, and Warner Music Group, Grooveshark said it has agreed to “cease operations immediately, wipe clean all of the record companies’ copyrighted works and hand over ownership of this website, our mobile apps and intellectual property, including our patents and copyrights.” Should Grooveshark violate its agreement, its parent company, Escape Media, could owe the record labels $75 million.

Advertisement

Grooveshark joins Napster and LimeWire on the list of once-popular music services that were eventually sued out of existence by big record companies. The demise of those operations, and particularly of Grooveshark, is striking compared with the success of modern streaming services like Spotify. In many ways, Grooveshark was a precursor to Spotify—unlike Pandora and other online radio stations, Grooveshark allowed users to select specific songs and create playlists from its music repository.

Spotify, perhaps learning from streaming sites before it, has taken pains to keep its service legal. In January, it publicized the fruits of those efforts: 15 million paid subscribers and 60 million total users. And all that without Taylor Swift.

Alison Griswold is a Slate staff writer covering business and economics.