MP3.com offers pay-for-play music

Will you pay to hear classical music over the Net? MP3.com, recently the target of the recording industry, is looking for customers and partners
Written by Marilynn Wheeler, Contributor

MP3.com last week ruled liable in a multibillion-dollar copyright infringement lawsuit -- on Tuesday launched what it called the first online subscription music channel and the future of the music business. MyMP3.com's Classical Music Channel will make 3,400 tracks by big-name artists available to subscribers for $9.99 (£6.38) per month.

The channel features Luciano Pavarotti, Yehudi Menuhin and the Royal Philharmonic Orchestra, among others, performing works by composers including Mozart, Beethoven and Bach.

New classical CDs will be added monthly, and additional channels are on the horizon. And that's only the beginning, said an MP3.com spokesman.

"Listening to music via subscription is the way of the future for the music business," said Chris Montgomery, MP3.com director of channel programming, in a statement. "We invite labels and content owners alike to join us in developing a mutually equitable system."

It's an interesting turn of events for MP3.com, which lately has been a target -- not a partner -- of the music industry. It's also a risky strategy: Most subscription services on the Net have failed to convince people to pay for content.

In a phone interview, Montgomery declined comment on how the pay-for-play service differs from the database of 80,000 CDs made freely available to MyMP3.com users, the target of a successful lawsuit by five major recording labels, including Sony Music, Seagram's Universal Music Group, and BMG.

"What we have here is a massive collection of content with full permissions to offer this content as part of a subscription model," Montgomery said. MP3.com has relationships with several small independent labels including Aurophone Records, Verdi, Finer Arts, Oratorio and Classic Perfection.

On Friday, a judge ruled the digital music service violated federal law by making a database of 80,000 copyrighted albums available to users of MyMP3.com. Legal experts estimated MP3.com could be subject to billions of dollars in fines if traditional penalties were applied.

After issuing his order, Judge Jed Rakoff of the US District Court for the Southern District of New York urged settlement talks between lawyers for MP3.com and the Recording Industry Association of America (RIAA), the trade group representing the record labels in the lawsuit.

"We hope to negotiate a way to offer the service (with content from major labels)," MP3.com Chairman and CEO Michael Robertson said in an interview with Reuters, adding that the two sides had been making progress after talking on "almost a daily basis for a long time."

The settlement talks included discussions of damages and whether MP3.com and MyMP3.com could continue to offer the copyrighted material, a source from one of the record labels told Reuters.

"We absolutely do not want to see MP3.com shut down," the source said. "We would be happy to see this thing settled."

Jason Mahoney of DSC, a public relations consultant to RIAA, said the trade group had no official comment on the new MP3.com service. He did not know whether any of the classical labels signed by MP3.com had relationships with the RIAA.

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