Digital music executives told Congress Thursday that online music systems could not thrive without an overhaul of the nation's copyright laws, drawing protests from songwriters and music publishers who depend on royalty payments for income.
The hearing marked the third time in a year that Congress took a look at the rapidly evolving world of digital music. But unlike previous hearings, Thursday's session in front of the House Judiciary Committee (news - web sites)'s Internet and intellectual property subcommittee did not pit music-industry executives against online music-swapping sites like Napster (news - web sites). Napster, which drew industry lawsuits and charges of piracy for its royalty-free system, has seen its popularity plunge in the wake of a March court ruling that forced it to block copyrighted songs from being traded between its users. |
With piracy concerns less prominent, the five largest music companies have initiated developing Internet distribution systems of their own. Thursday's hearing focused on a dispute between songwriters and publishers, who own music rights, and the record companies and online services that need their permission in order to distribute their music.
``Music publishing issues stand out as the most significant potential impediment to launching great subscription services,'' said RealNetworks Inc. (NasdaqNMNWK - news) Chief Executive Rob Glaser, after giving a demonstration of MusicNet, the service being developed in conjunction with major music companies AOL Time Warner (NYSE:AOL - news), Bertelsmann AG (news - web sites) (BTGGga.D), and EMI Group Plc (news - web sites) (EMI.L).
MP3.com Inc. (NasdaqNM:MPPP - news) President Robin Richards said his company faced an impossible task in individually securing permission from thousands of songwriters before making their material available on its My.MP3.com online music-storage system. While one organization, the Harry Fox Agency, represents 70 percent of all music publishers, MP3.com must find and negotiate individually with the thousands of other songwriters who are unrepresented, Richards said.
Richards called on Congress to enforce a flat, per-song royalty rate similar to one satellite and cable music systems enjoy, a solution decried by country star Lyle Lovett as ''government price-setting that should be repugnant to those who believe in the free market and the sanctity of private property, including intellectual property.''
Source: Yahoo.com
