The tech world is abuzz with news of XM being sued by the Hollywood cartels. I've compiled a lot of comments from tech leaders and organizations:

Gigi Sohn of Public Knowledge:

Consumers for years have had the legal right to record music for their own use. This lawsuit threatens that right on the grounds that consumers now have advanced technology at their disposal in recording songs. The shame of the legal action, however, is that this is really a dispute between XM and the recording industry over licensing fees. The companies should be left to figure out a solution without interference from the courts or from Congress.

CEA:

There they go again. The record industry is returning to the courts in their non-stop efforts to stop new technology, frustrate consumers and make illegal long-standing consumer home recording activities. Their new target is XM Satellite Radio, one of America's top technology success stories of the new millennium. XM's only offense is providing legal and exciting programming options to millions of Americans, while opening new revenue and promotional opportunities for the recording industry.

The lawsuit announced yesterday is a brazen effort by the labels to strong-arm more money from a successful technology industry startup. XM Radio already is the largest single payer of digital music broadcast royalties. More, the record labels receive royalties on every XM recording device sold as provided by Congress under the Audio Home Recording Act (AHRA).

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It is time to say 'enough is enough.' It is time to put an end to ill-founded lawsuits and over-reaching legislation that impose an 'innovation tax' on consumers and technology developers. These ongoing efforts discourage innovation and jeopardize America's global technology leadership.

If only the music industry spent as much time adopting digital business models as they do filing lawsuits and advocating anti-consumer legislation, they might find that technology can actually expand their market. Instead, this litigation undermines our efforts to work with the recording industry on digital technology issues of mutual interest.

On behalf of American consumers and technology innovators, we look forward to standing with XM as it defends this lawsuit. The consumer technology industry will continue to take a strong stand against persistent, punitive, and over-reaching efforts by the record labels to control innovation and limit reasonable consumer activities.

And of course, the EFF is on top of it:

An attack on home taping: In the RIAA's view, home taping is illegal, at least when done with today's digital tools: "The XM+MP3 subscribers are creating unauthorized reproductions of Plaintiffs' copyrighted sound recordings,... and therefore are guilty of direct copyright infringement...." So much for fair use. So much for the AHRA. Sorry Pioneer, Samsung, and all the other innovators out there, but apparently home taping is only legal so long as the RIAA dictates the feature-set of the recorders.

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Transmission + Recording = Distribution: As we've discussed previously, the RIAA has been trying to expand the scope of the "distribution" right on the backs of individual P2P file-sharing defendants in cases like Elektra v. Barker. The goal? To force broadcasters (and others who thought all they were doing was publicly performing music) to pay a second time for distribution licenses. If the RIAA wins on this score, then radio stations and webcasters are all in hot water, too.

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Holding design against innovators. The RIAA claims that XM should be held liable for both inducement and vicarious liability because it could have designed its technology differently, an argument familiar from the MGM v. Grokster battle. Of course, in that case even the Department of Justice (see fn.3) rejected the RIAA "you could have designed it differently" argument as baseless. If the RIAA succeeds this time, innovators could face liability whenever a court decides they didn't do "enough" to prevent infringement. The value of "enough," of course, will not be revealed to you until after you spend millions in legal fees and risk losing your company to ruinous statutory damages.

It would seem pretty clear that the Hollywood cartels are operating under the legal precedent of 'backsies'.