MP3.com Reaches Tentative Pact with Publishers

Posts: 317
From: Columbia, MD, USA
Registered: Feb 2000

posted 10-18-2000 10:54 AM     Click Here to See the Profile for ben_fenlon        Edit/Delete Message

By Derek Caney

NEW YORK (Reuters) - Online music company MP3.com Inc. said on Wednesday it would pay up to $30 million to music publishers in a preliminary pact that would give it the right to use more than one million songs as part of its Internet-based service.

Under the terms of the deal, trade group National Music Publishers' Association and its licensing subsidiary Harry Fox Agency, will allow the songs to be used as part of a service called My.MP3.com, which allows users to store music digitally and then access it via any computer.

The service relies on a database of more than 80,000 albums that MP3.com initially created without the permission of the music publishers or the world's largest record labels that also own the rights to the music.

A U.S. District Court ruled in April that MP3.com broke copyright law by creating the database. Since MP3.com has settled with four of the five major labels: Time Warner Inc.'s Warner Brothers music group, Sony Music Entertainment, BMG, the music unit of Bertelsmann AG and EMI Group Plc.

Seagram Co.'s Universal Music Group is the only major label not to have reached an agreement with MP3.com. Following a September ruling on damages by the same court, MP3.com could face up to $250 million in damages. MP3.com said it would appeal the decision.

The agreement requires the ratification of the member publishing companies and approval by the court. Independent publishers MPL Communications, which is controlled by former Beatle Paul McCartney, and Peer International Corp. also reached agreement with MP3.com.

Under the three-year agreement, MP3.com's maximum $30 million payment will cover payments to publishers for past uses of their music on the My.MP3.com service as well as advance royalty payments.

Under the royalty terms, MP3.com will pay a quarter of a cent each time a song is accessed on the service and a one-time fee each time a user stores a song on the service.

MP3.com shares closed at $2-3/4 in Tuesday's Nasdaq trading, up $1/16 from the previous close. The company traded as high as $105 in its first day of trading in July 1999.

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Posts: 1131
From: Bowling Green, KY, USA
Registered: Mar 2000

posted 10-18-2000 10:01 PM     Click Here to See the Profile for KennyLee        Edit/Delete Message

quote:

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Originally posted by ben_fenlon:

MP3.com shares closed at $2-3/4 in Tuesday's Nasdaq trading, up $1/16 from the previous close. The company traded as high as $105 in its first day of trading in July 1999.

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Well, Wall Street is really excited about this, I can tell.

I'm glad MP3.com is slowly buying it's way into the major label music biz. Just cause it looks like the only way they can stay alive.

Of course, if Napster wins at the Supreme Court level, it will all have been for naught.

Welcome back, ben. Did you give Sean a day off?

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