June 30, 2005
Sony BMG Licenses Music for Online Service
By JEFF LEEDS
Sony BMG Music Entertainment, whose artists include John Mayer and Usher, has struck a deal to license its music to an online service intended to mimic the popular file-sharing networks long derided by record companies as dens of piracy.
The deal with the Mashboxx service, announced yesterday, is an example of how music labels and software companies are experimenting with legal versions of file swapping.
It could be a harbinger of more alliances in the wake of the Supreme Court's unanimous decision this week against two file-sharing networks. The high court said the two companies, Grokster and StreamCast Networks, could be found liable for infringement if they intentionally encouraged users to trade copyrighted music freely.
The deal with Mashboxx, led by Grokster's former president, Wayne Rosso, aims to create an open network while limiting or even blocking the trading of copyrighted material.
As part of the deal, Sony BMG's music will be available on the service for 99 cents a track. Mr. Rosso said users wishing to preview a song could download a version that plays a limited number of times, with a voice-over advertising the full rendition being heard intermittently over the music. Anyone deciding to purchase would get access to the unadulterated song.
Mr. Rosso said the network would allow the free exchange of music by artists and labels who wished to make their work available free, as well as live-concert recordings and other hard-to-find files.
Andrew Lack, the chief executive of Sony BMG, said after the court ruling this week he talked with several file-sharing companies about incorporating software to filter out unauthorized material and re-establishing themselves as licensed services. "The file-sharing services that I spoke to were reluctant to employ those technologies before the court ruled" in the Grokster case, Mr. Lack said. "My hope is that we can build new bridges. If they don't want to have that dialogue, they're going to get shut down."
