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Tuesday, 16 October, 2001, 10:15 GMT 11:15 UK
Download sites face more scrutiny
There are fears that the sites could have unfair control
There are fears that the sites could have unfair control
The US government has expanded its investigation into planned legal music download services amid concerns about their reach.

The US Justice Department is concerned that the major record companies could prevent fair competition in the market.

The Recording Industry Association of America (RIAA) has now been issued with a subpoena to provide more information about its plans.

The Justice Department fears are about two forthcoming services from major record companies - Pressplay and MusicNet.

MusicNet: Joint venture by three major record labels
MusicNet: Joint venture by three major record labels

The size and scope of these could stop independent sites from competing in an area that is seen as one of the main growth sectors for the music industry.

The European Union recently raised the possibility of blocking the services from launching if they were found to be anti-competitive.

A MusicNet spokeswoman said they "are co-operating" with the inquiry after confirming that they had been subpoenaed.

Pressplay said they had received "a request for information", and described the investigation as "a matter of routine".

"We have been co-operating with this inquiry and will continue to do so," spokesman Seth Oster said.

Delay

The Justice Department launched the investigation last summer, and the services had been scheduled to launch before the end of this year.

But weekend newspaper reports suggested that the launch had been forced back.

They have been planned as legitimate alternatives to highly popular services like Napster, which let fans swap songs between themselves without paying royalties to artists or record companies, but which was shut down during an ongoing copyright court case.

In that case, Judge Marilyn Hall Patel recently said MusicNet had the hallmarks of an anti-competitive business enterprise that "looks bad, sounds bad and smells bad".

Share

But the record companies argue that they are planning to work together with a new, legitimate Napster that will launch before the end of the year.

Napster is now part-owned by Bertelsmann, which also owns one of the major labels, while EMI recently announced that its music would be available on both MusicNet and Pressplay.

An American congressman is currently trying to introduce a law that would give all download services the same access to music regardless of whether they are affiliated with the record company that releases the songs.

MusicNet is owned by AOL Time Warner, Bertelsmann, EMI and RealNetworks, while Pressplay is a joint venture by Sony and Vivendi Universal.

See also:

01 Oct 01 | New Media
Record labels 'fight' download plan
12 Jun 01 | Business
EU opens online music probe
01 Oct 01 | Sci/Tech
Music's digital future
27 Sep 01 | New Media
MusicNet to launch 'in 60 days'
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