The site blames rising licensing fees in the country

Jan 18, 2012 18:01 GMT  ·  By

Grooveshark's troubles continue as the site has been forced to block German users from accessing it. The recent lawsuits the major record labels have filed against the company are not to blame, rather, rising licensing prices demanded by the German music rights collection group GEMA, have forced Grooveshark to stop servicing users in the country.

German visitors to the site will see a notification and won't be allowed to proceed further.

"Because disproportionately high operating costs is one Grooveshark access from Germany," the notice says.

"We will miss you! You’re welcome to write . We hope to come back one day. If you want to reduce the operating costs for both providers and Grooveshark, you can send a polite message to GEMA," Grooveshark added.

GEMA is a performance rights collection organization, it collects fees from any company that streams, broadcasts, or simply plays music in a public space. These fees are unrelated to the recording industry, they go to the songwriters.

Grooveshark has been paying a fee to the German organization to be able to stream any of the songs by artists and rights holders represented by GEMA, more than 2 million of them in total.

But GEMA has been aggressive in collecting as high a fee as possible, it even went after YouTube at one point.

It seems that the latest demands have proven unreasonable for Grooveshark, which was forced to shut down the site in the country rather than pay the higher fees. Grooveshark has less than three million users in the country. It's unclear what will happen to the users that paid for the service.

Grooveshark has bigger problems than this though, it is currently being sued by the four major labels, in two separate lawsuits. Those may take a while to go through, but it's not going to be easy for the site.