Great post, Lucas. It’s well known playlist has been in negotiations with the labels for a while and this obvious negotiation tactic with a shady anticompetitive overtone.
There’s one issue that you didn’t mention though. Playlist heavily caches content. It’s the only way you can operate a playlisting service at any scale reliably. We never cached at Mixwit, and we payed for with user attrition.
That said, the issue of caching in this way has never been sorted out in court. The closet I know of is the Google vs Perfect 10 case which laid down the framework for how google image search works. I wouldn’t say it’s slam dunk on either side if it went to court.
Unfortunately for playlist, myspace is their achilles heal. I’m not expert on their numbers, but this seems like it could be nuclear bomb on their traffic.