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Sources said the $20 million price tag was significantly boosted by EMI Music Publishing's market strength and EMI's length of term for the licenses.
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…AND EMI MAKES THREE

MP3.com To Pay $20 Million
In Settlement With Brit Conglom
On the eve of what could be a landmark decision in the Napster case, EMI Recorded Music has reached a $20 million settlement agreement with music service provider MP3.com, becoming the third major label group to take the plunge.

Inside sources at both MP3.com and EMI confirmed the deal was imminent and could be announced within the next few days.

As part of the deal, MP3.com will pay EMI $20 million, which will include payments for past copyright infringements and an advance on future licenses. Sources said the $20 million price tag was significantly boosted by EMI Music Publishing's market strength and EMI's length of term for the licenses.

At a conference held last Friday (7/21) at the Capitol Tower in Hollywood, EMI New Media head Jay Samit and EMI's Robyn Glaser met with MP3.com representatives Robin Richards, Gary Gersh and Gary Stiffelman of Ziffren, Brittenham, Branca and Fischer LLP to bang out the accord.

EMI and MP3.com representatives could not be reached for comment.

With EMI inking its deal this week, only two majors remain uncommitted to the once-renegade online outfit. Sony Music, which sources said is close to signing, and Universal Music Group, which remains very distant, especially considering the three-year non-exclusive licensing arrangement it struck Tuesday with Musicbank.

EMI follows in the footsteps of BMG Entertainment and Warner Music Group, who last month became the first two major record congloms to ink (hitsdailydouble.com, 6/6).

Sources said the structure of EMI's deal is similar to those struck by the two other majors. There are two primary points to the MP3.com-label pacts: past damages and advances on future licenses based on length of term, which tally $150 million. This sum will eventually be split in some predetermined way among those members of the Big Five and other smaller record and publishing companies that close deals with MP3.com.

Specifically, the licensing agreement requires the netco to pony up approximately 1.5 cents per track stored in a locker at My.MP3.com, and roughly 1/3 of a cent each time a song is streamed by any My.MP3.com user.

These non-exclusive licensing deals will likely set the music-industry standard for similar digital-distribution agreements between traditional and online parties. The current deals set up a standard for streaming but not for downloading. The majors all have plans in place for vending downloads.

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