Napster Head Calls on U.S. Congress for Help

Jan 9, 2002 12:00 PM

           
 

The head of Internet music service Napster Inc. asked the U.S. government on January 7th to force recording companies to share their catalogs with independent digital music sites. Napster CEO Konrad Hilbers told musicians, lawyers, and music-industry officials at a music conference that Congress should consider establishing a mandatory per-song rate that Web sites such as Napster could pay recording companies if they cannot forge deals on their own.

"If no agreement between rights holders and new, independent distribution initiatives can be achieved in the short term, Congress will have little choice but to consider the compulsory licensing of sound recordings," Hilbers said. It is an argument Napster has used since last spring, when the company announced that it intended to pay artists for their music.

Napster attracted more than 60 million users last year, lured by its unlimited supply of free music, but has been in the process of retooling itself as a fee-based service since it was shut down by a court order last July. Analysts say the company will have a formidable task recapturing an online audience that now can choose from two industry-backed services, MusicNet and Pressplay, and a variety of rogue services that provide free, unlimited access as Napster once did. Hilbers offered few details on how the revamped Napster will work, other than to say it would compensate artists whose songs were downloaded if they so wished, and that users would face some restrictions. The new Napster will allow users to trade songs with each other but prevent them from transferring songs to portable MP3 devices, Hilbers told Reuters after his speech. The company could roll out a test version as early as this week, but still must reach licensing agreements with the five major labels who together control 80 percent of all recorded music.

"We must obtain major-label content, and this remains our greatest obstacle," Hilbers said. If the five majors–AOL Time Warner Inc.'s Warner Music, Sony Corp., Bertelsmann AG, BMG Music Group, and EMI Group–prove unwilling to strike a deal, Congress should step in and authorize the Copyright Office to establish a flat, compulsory rate, he said. Such compulsory rates, used by radio stations to compensate songwriters, are generally opposed by recording companies who would prefer to negotiate individually.

-REUTERS