Unlicensed music discovery service Project Playlist is being sued for copyright infringement.

The Palo Alto-based operation hosts a "universal jukebox", similar to WebJay. It trawls the web for song files, and claims it doesn't host the songs itself, thereby qualifying for a copyright infringement exception.

The player can be embedded in other websites such as MySpace. Warner, EMI and UMG and their subsidiaries are named as plaintiffs in the case, filed in a New York court.

Not all services receive the legal hairdryer treatment. Social.fm, which began life as Mercora, hosts a conceptually similar jukebox service, but has built-in royalty payment mechanism. Project Playlist to pay royalties too.

The case is likely to stretch the "safe harbor" provisions of the DMCA, used by publishers and search engines, to breaking point. BetaNews notes that contrary to the impression given by the service, it both hosts and delivers chunks of music, as the suit alleges.

"We were able to take the rather academic step of retrieving an MP3 file of a song triggered from a Project Playlist member's list, listened to using Windows Media Player 11, from Windows' temporary download directory. It was indeed a download," writes Scott Fulton.

Sony BMG yesterday expanded its free streaming partnership with We7. Half a million tracks are now available, with ten second adverts inserted between songs. Just 25m songs to go, then.

Story source: theregister.co.uk