BMG and Warner Music Enter Settlement with MP3.com

Will MP3.com Now Need to Charge for the Service?

Wizard is "Surprised" by Settlement

This is the first sign of light for the embattled on-line music service since the lawsuit brought in January alleging that MP3.com infringed on the labels copyrights by creating a database that allowed CD owners to listen to their previously purchased CD's on-line.

This lawsuit is just one phase of an anti-piracy crusade launched by the Recording Industry Association of America (RIAA) and it's members in an effort to corral the success of MP3 technology. The other labels in the copyright infringement suit included Sony Music Entertainment, Seagram Co.'s Universal Music Group, and EMI Group Plc. Curiously, no additional announcements have followed the June 8, 2000 settlements.

As of today the Warner and BMG selections were still not available on-line. There are royalty issues going forward and my.mp3.com had been a totally free service. How MP3.com will handle the new settlement remains to be seen.

Michael L. Robertson, chairman and CEO of MP3.com released a statement saying, "In our continuing efforts to return your music to your My.MP3.com account, MP3.com has struck revolutionary agreements with the Warner Music Group and BMG Entertainment. However, pending ongoing negotiations with other parties, we cannot yet reactivate their music in My.MP3.com."

Financial terms of the Warner deal with MP3.com were not disclosed. Sources who claim to be "insiders" say the settlement is in the $25,000,000 range. This is in line with earlier estimates that put the proposed total settlement at 100 million dollars.

The WIZARD admits surprise at the settlement. In earlier articles we had predicted false hopes followed by a crushing defeat. This settlement is a real tribute to mp3.com management and the continued support of the service and the mp3 format itself (which curiously wasn't involved in this particular lawsuit or settlement) from the Internet community.