MP3.com Negotiates Licensing Deal With Music Publishers
While online music destination MP3.com continues to wrestle record company Universal
Music in a potentially crippling lawsuit, it has inked a tentative
licensing deal that could see top music publishers give their
blessings to the company's controversial My.MP3.com service.
MP3.com and the National Music Publishers' Association (NMPA) today
announced an agreement that will see the online digital music
company pay up to $30 million over the course of the three-year
pact. The payments, to be administered by the NMPA's wholly owned
licensing arm, the Harry Fox Agency, would clear copyright hurdles
with some 25,000 music publishers who rely on the agency for its
communal royalty funds.
The publishers lay claim to some 1 million songs, the NMPA said.
The proposed license would see MP3.com pay one quarter of a cent
each time a song is streamed on demand to a subscriber of its
My.MP3.com service. In addition, there will be a one-time fee paid
for each track added to the service's library of tunes.
The NMPA said the MP3.com payments will be placed in two separate
royalty funds - one to pay publishers for past uses of music on the
My.MP3.com service, the other to provide advance payments toward
royalties earned under the new license.
The deal, which has yet to be finally endorsed by individual
publishers, would also bring to an end a lawsuit against MP3.com by
music publisher MPL Communications (controlled by songster Paul
McCartney) and Peer International Corp. That lawsuit, launched in
March, didn't have the profile of a parallel suit launched by five
of the largest recording companies, but it also targeted the online
music-locker service known as My.MP3.com.
My.MP3.com allowed subscribers to access online copies of music
they already owned as part of traditional CD collections or as
digital downloads purchased online. However, the record companies
and publishers claimed in their lawsuits that My.MP3.com amounted
to copyright infringement, since the music was copied from
MP3.com's collection of some 80,000 CDs and not those of the users.
MP3.com has settled with four major labels initially part of the
record-industry lawsuit. However, Seagram Co.'s Universal Music
Group fought. In September, a federal judge in New York ruled that
MP3.com could be looking at damages ranging from $118 million to
$250 million in the Universal suite alone.
The settlements with the record companies included licensing deals
for the recordings issued by those labels.
At this stage, even if the pact with the NMPA is approved by the
publishers, MP3.com is still lacking full rights to stream
recordings from Universal Music. Also unclear is the status of
music from smaller independent labels.
"We believe that our negotiations with MP3.com have yielded a
landmark proposal that NMPA can refer to the music publishing and
songwriting community with confidence and enthusiasm," Edward
Murphy, president and chief executive officer of the NMPA said in a
statement. "This is a triple win - for music creators, Internet
music service providers, and consumers.
"We can now look forward to a productive and mutually beneficial
relationship with MP3.com and similar services that respect the
principles of copyright protection," Murphy said.
Robin Richards, president and chief negotiator for MP3.com said:
"We believe the digital music space, through this agreement, has
been thrust forward by the music publishers. All concerned should
be tipping their hat to the Harry Fox Agency for stimulating and
unlocking enormous value for artists, consumers, songwriters and
publishers."
The NMPA can be found online at: http://www.nmpa.org/.