The recent settlement between MP3.com Inc. and a consortium of music publishers provided further indication that the world of downloadable music is slowly losing its Wild West flavor. In fact, that's why I skipped this month's Hot List: Finding Internet tracks that are legitimate, free, and exclusive is getting to be more and more like a snipe hunt.
In the latest victory for the record industry, MP3.com said it would pay up to $30 million to music publishers in a preliminary pact that would give it the right to use more than one million songs as part of its Internet-based service. Under the terms of the deal, the trade group National Music Publishers' Association and its licensing subsidiary will allow the songs to be used as part of the formerly controversial service called My.MP3.com, which allows users to store music digitally and then access it via any computer. The service relies on a database of more than 80,000 albums that MP3.com initially created without the permission of the publishers or the labels that also own the rights to the music.
A U.S. District Court ruled in April that MP3.com broke copyright law by creating the database. MP3.com has settled with four of the five major labels: Time Warner Inc.'s Warner Brothers music group; Sony Music Entertainment; BMG, the music unit of Bertelsmann AG; and EMI Group. Seagram Co.'s Universal Music Group is the only major label that has not reached an agreement with MP3.com. Following a September ruling on damages by the same court, MP3.com could face up to $250 million in damages.
Under the three-year agreement, MP3.com's maximum $30 million payment will cover payments to publishers for past use of their music on the My.MP3.com service, as well as advance royalty payments. Under the royalty terms, MP3.com will pay a quarter of a cent each time a song is accessed on the service and a one-time fee each time a user stores a song on the service, a burden that almost certainly will bankrupt the company.
That's the bad news. The good news is that as the digital audio device market explodes (from 300,000 units sold in 1998 to 4 million in 2000), MP3 technology is getting easier and cheaper. Mpuls3 recently introduced a player that retails for $79, and it's actually not a piece of junk. It uses compact-flash memory (the type used in digital cameras) and can write compact flash I and II modules from 4MB to 340MB. There is no memory on board, which means users can buy the capacity of their choice and exchange memory modules with other users.
More good news is that the promise of high-quality, customizable Internet radio is inching closer to reality. Among the latest entries into this crowded market is MusicMatch's Jukebox, available for free download. Jukebox boasts the capability to "learn" what kind of music you like based on which of its channels you listen to most often.
But the Product o' the Month award goes to ZY Computing's $30 MP3 CD Maker, a Windows application that facilitates one-click creation of audio CDs from MP3 files--no more MP3-to-WAV conversion tomfoolery. The product also answers the prayers of more than a few CD homebrewers by equalizing the volume of all of tracks it creates, and eliminating the annoyance of sound levels that vary from track to track. In addition. it has a preview mode that allows you to hear your CD as it will sound (and change it if you want), all before burning begins. A trial version is available at ZY's Web site.
