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Tuesday, 9 October, 2001, 10:55 GMT 11:55 UK
Landmark online music deal reached
The music industry clamped down on illegal downloads
US music publishers and record companies have announced a "breakthrough agreement" on making music available on the internet.

Now, record companies will have access to all the musical works licensed by the Harry Fox Agency, the agency which licenses music copyrights for recording purposes in the US.

This agreement removes a major legal roadblock

Hilary Rosen, RIAA
The National Music Publishers' Association (NMPA), the Harry Fox Agency and the Recording Industry Association of America (RIAA) concluded the agreement on Tuesday.

It removes a significant obstacle to music availability on the internet, by allowing the automatic licensing of works without record companies having to clear songs with individual publishers.

Deal on royalties

"This agreement removes a major legal roadblock for the new online subscription services," RIAA president Hilary Rosen said in a statement.

The agreement has been reached in advance of a final deal on royalties - but the RIAA will pay the Harry Fox Agency an advance of $1m (680,000) towards the yet-to-be determined royalties.

If the two sides are not able to settle on a rate during the next two years, the recording industry will pay monthly advances totalling $750,000 (510,000) per year until a rate is set.

But publishers represented by the Harry Fox Agency will be able to opt out of the deal if they want.

Stumbling block

The deal is also non-exclusive - and subscription services or record companies may deal directly with individual music publishers if they wish.

One of the stumbling blocks for the big record companies' own file-swapping services, due to launch before the end of the year, has been the problem of licensing and paying for copyrighted music.

MusicNet and Pressplay are the industry's attempt to attract people away from unofficial music download services, including Napster, which has now taken steps to develop a paid-for service.

MusicNet is the joint venture between BMG, EMI and Warner and Pressplay is backed by Sony and Universal.

But all the record companies involved license their music from many different music publishers, most of whom have not been party to the majors' internet agreements to date.

By simplifying and speeding up the business of licensing this repertoire, the new agreement could finally clear the way for much more recorded music to be available - legally - on the internet.

See also:

10 Sep 01 | New Media
Online music-swapping rocks
06 Aug 01 | New Media
Online music bill 'meets disapproval'
31 Jul 01 | New Media
Negotiators join web royalty row
24 Jul 01 | New Media
AOL launches online music services
24 Jul 01 | New Media
New boss for Napster
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