DOJ PROBES ONLINE MUSIC DEALS
The Justice Department, which oversees antitrust law, has started a preliminary investigation into two Internet ventures: pressplay, backed by Sony Music Entertainment and Universal Music Group, and MusicNet, backed by EMI, BMG and AOL Time Warner. The probe will examine potential anti-competitive problems posed by the rival ventures' soon-to-be-released paid subscription music plans. U.S. lawmakers have also raised questions about whether the two Internet services will harm competition because the five record labels currently involved represent about 80% of copyrighted music.
Representatives from the Justice Department and the five labels did not comment on the investigation.
Legislators are also exploring the issue of music sales online. Representatives Rick Boucher (D-Va.) and Christopher B. Cannon, (R-Utah) introduced legislation that would require companies when they license music for sale to one Internet site to make the music available to other sites under the same terms, thus allowing an indie start-up access to the same music as, say, pressplay, at the same price.