Beijing - Yahoo China has lost its appeal of a Chinese court ruling that found the company's digital music service, which offers "deep links" to unauthorized music downloads, facilitates copyright infringement. The International Federation of the Phonographic Industry (IFPI), whose record label members first brought the case against Yahoo China, praised the ruling.

"The ruling against Yahoo China is extremely significant in clarifying copyright rules for Internet music services in China," said IFPI chairman and CEO John Kennedy.

"By confirming that Yahoo China's service violates copyright under new Chinese laws, the court has effectively set the standard for Internet companies throughout the country."

Yahoo (NASD: YHOO) owns a 44% stake in Yahoo China, which is a joint venture with China's Alibaba Group.

The Beijing Higher People's Court did not find search engine Baidu liable on similar deep-linking copyright claims, but Kennedy of the IFPI said, "that judgment was about Baidu's actions in the past under an old law that is no longer in force. The judgment is irrelevant since it has effectively been superseded by the Yahoo China ruling."

Related Links:
http://www.ifpi.org/content/section_news/20071220.html

http://snipurl.com/1vm3k (Billboard)

http://www.alibaba.com