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MUCH TALK ABOUT
MP3.COM TALKS
MP3.com’s Settlement Negotiations
Drag On—To What End?
In the wake of MP3.com's decision yesterday to remove major-label content from its controversial My.MP3.com service—following a judgment that the service violated RIAA copyrights—all eyes are now on the netco's negotiations with the labels.

Observers say the company has had little traction in the talks, and that matters have been further complicated by the fact that while RIAA ruler hilary rosen',390,400);">hilary rosen',390,400);">Hilary Rosen has negotiated on behalf of most of the plaintiff labels, counsel for Warner Music Group has acted on its own—and made life especially tough for the online company.

The labels, which have now won two successive high-stakes rounds, obviously feel confident at this point in their ability to control the destiny of their content. Past enmity with michael robertson',390,400);">michael robertson',390,400);">Michael Robertson's previously confrontational Web entity is clearly also a factor in the record companies' hardline stance. However conciliatory MP3.com's recent gestures, repairing past damage will evidently be a daunting task.

But speculation abounds as to WMG's game plan and what role its soon-to-be-parent company AOL plays in it. Does punishing MP3.com further have anything to do with AOL's long-term digital-delivery plans, and its status as a potential competitor? Does this, in fact, serve the interest of the labels? As a model for digital delivery, My.MP3.com enjoys more than a few admirers within the industry, which raises the question of whether licensing music to the existing structure would be more or less advantageous than building an alternative version of the service.

With the exception of farmclub.com—which bears the stamp of two record-biz pros and has a TV show to boost its reach—most of the record companies' online ventures thus far have sprung from the efforts of attorneys, bureaucrats and tech people, and it shows in their relative lack of impact. The lion's share of forward-looking, eyeball-generating delivery models have come from outside. Which has predicters predicting that "first movers"—even the ones who provoke wrath and litigation of the labels—have a vital role to play.

For now, however, it's back to the negotiating table.

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