Napster Head Calls on U.S. Congress for Help

The head of Internet music service Napster Inc. asked the U.S. government on January 7th to force recording companies to share their catalogs with independent

The head of Internet music service Napster Inc. asked the U.S.government on January 7th to force recording companies to share theircatalogs with independent digital music sites. Napster CEO KonradHilbers told musicians, lawyers, and music-industry officials at amusic conference that Congress should consider establishing a mandatoryper-song rate that Web sites such as Napster could pay recordingcompanies if they cannot forge deals on their own.

"If no agreement between rights holders and new, independentdistribution initiatives can be achieved in the short term, Congresswill have little choice but to consider the compulsory licensing ofsound recordings," Hilbers said. It is an argument Napster has usedsince last spring, when the company announced that it intended to payartists for their music.

Napster attracted more than 60 million users last year, lured by itsunlimited supply of free music, but has been in the process ofretooling itself as a fee-based service since it was shut down by acourt order last July. Analysts say the company will have a formidabletask recapturing an online audience that now can choose from twoindustry-backed services, MusicNet and Pressplay, and a variety ofrogue services that provide free, unlimited access as Napster once did.Hilbers offered few details on how the revamped Napster will work,other than to say it would compensate artists whose songs weredownloaded if they so wished, and that users would face somerestrictions. The new Napster will allow users to trade songs with eachother but prevent them from transferring songs to portable MP3 devices,Hilbers told Reuters after his speech. The company could roll out atest version as early as this week, but still must reach licensingagreements with the five major labels who together control 80 percentof all recorded music.

"We must obtain major-label content, and this remains our greatestobstacle," Hilbers said. If the five majors–AOL Time Warner Inc.'sWarner Music, Sony Corp., Bertelsmann AG, BMG Music Group, and EMIGroup–prove unwilling to strike a deal, Congress should step inand authorize the Copyright Office to establish a flat, compulsoryrate, he said. Such compulsory rates, used by radio stations tocompensate songwriters, are generally opposed by recording companieswho would prefer to negotiate individually.