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The U.S. House of Representatives Holds Hearing on Music and the Internet
By Heather Johnson
(more articles from this author)
2001-05-24
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Testimony heard last week before the U.S. House of Representatives Subcommittee on Courts, the Internet and Intellectual Property indicated that the entertainment industry was looking to Washington for solutions on how to use Web distribution to better serve customers. That theory, however, was blown out of the water just a few days later when Vivendi Universal announced that it would acquire San Diego-based MP3.com in a $372 million agreement.

As the proud owner of one of the top worldwide Internet brands, Vivendi expects to strongly reinforce their digital efforts in the areas of online music, subscriptions, branding, technology and all its content.

At last week's house hearing, Vivendi Universal Executive, Vice Chairman Edgar Bronfman, expressed, for what are now obvious reasons, an optimistic view of music and the Internet.

"The challenges to the secure digital distribution of music and other intellectual property are significant," Bronfman explains. "As such, the process of their resolution is sometimes frustrating and always time consuming. However, the opportunities are vast and our determination to achieve a robust digital marketplace for music intensifies everyday. In that brave New World, we and our retail partners will be able to reach every consumer that has an Internet connection. Consumers in small towns will then have the same access as those who now live near large retail outlets. Shelf space will not be an issue, so back catalog will be right next to the recordings at the top of the charts."

Now it seems Vivendi has cornered that robust digital marketplace. As the premier distributor of music on the Internet, MP3.com features, and will continue to feature, content from the 'big 5' record labels and independent artists & labels. There are currently over 150,000 artists from more than 180 countries that make their music available to music fans through MP3.com, and more than 25% of Billboard Magazine's current Top 40 albums are being promoted on MP3.com. The total aggregate audience for MP3.com, and Vivendi partners GetMusic, FarmClub and EMusic, represents close to 40 million registered users, with approximately 120 million monthly page views.

Now that MP3.com is owned by one of the industry's top recording companies, the members of the American Federation of Television and Radio Artists (AFTRA) could be in for a longer fight. The union representing recording artists is urging Congress to effectuate its intent that performers share copyright license fees from music on the internet by ensuring that the license fees which Congress earmarked for artists go directly to them, rather than pass through other entities, such as recording companies.

AFTRA's Director of Sound Recordings, Ann Chaitovitz, testified that while copyright law mandates that recording artists receive a portion of the revenues derived from Internet broadcasting of their work, direct payment to them, rather than to third parties, will ensure proper and timely compensation and eliminate the need for expensive audits.

MP3.com President Robin Richards explained that these negotiations are within reach, but are also complicated and time consuming.

"MP3.com looks forward to working with Congress to develop a legislative proposal that rationally balances the interests of copyright users, copyright owners, and - most importantly - consumers," Richards said. "However, we recognize that enacting copyright reform could take time. And time is one thing that Internet-based technologies don't have in unlimited quantity. For example, MP3.com has a loyal following of music lovers who have purchased CDs and who want to use our service as a convenient way of listening to the songs on those CDs. We have millions and millions of dollars worth of licensing agreements with the record labels. But we still can't give consumers access to all of their music - and this is a problem that will be faced by every Internet music provider - because right now there is no practical way to contact all of the music publishers with copyright ownership claims in the more than 900,000 songs in our digital library."

While key players in the digital distribution and recording communities continue to discuss, testify, argue and occasionally reach agreements, the consumers will continue to watch with curiosity to see how will the new Vivendi Universal agreement affect this ongoing dilemma.

Linkography

AFTRA - www.aftra.org
Billboard - www.billboard.com
Emusic - www.emusic.com
Farmclub - www.farmclub.com
Get Music - www.getmusic.com
MP3.com - www.mp3.com
U.S. House of Representatives Congress Committee on the Judiciary - www.house.gov/judiciary/
Vivendi Universal - www.vivendi.com

Related MusicDish e-Journal Articles:
» Markets are funny. Ask MP3.com - Vivendi Universal Acquires MP3.com (2001-05-21)
» The Senate Judiciary Hearings: 'Me! -- No, Me! -- NO! ALL OF US!' (2001-04-09)

Related News from Mi2N:
» Vivendi Universal Acquires MP3.com In Move To Strengthen Digital Distribution Capacity And Web Audience
» Statement Of The Honorable Howard Coblechairman
» Statement Of LYLE LOVETT
» Written Testimony Of Robin Richards President, MP3.com, Inc.
» Testimony Of Rob Glaser, Chairman And CEO Of RealNetworks, Inc.
» Testimony Of Edgar Bronfman, Jr. Executive Vice Chairman, Vivendi Universal
» AFTRA Urges Congress To Ensure That Royalties Earmarked For Recording Artists Are Paid Directly To The Artists


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