CNet reports that the judge in Universal’s lawsuit against MP3.Com has determined that MP3.Com should pay $25,000 per copyright violation, which could cost MP3.Com upwards of $120 million from this suit alone — and there are bound to be more lawsuits as other record companies jump on the bandwagon. MP3.Com vows to appeal, but if this judgment is upheld, MP3.Com is probably dead, especially since Universal clearly is never going to give the company approval to use its music on the MyMP3.Com service.
I think the judge here made the right decision. Napster was treading on thin ground when it said “Come get free copies of other people’s music here,” but MP3.Com stepped way past the line when it said “Come get free copies of other people’s music — we went out and coded it for you.” MP3.Com tried to claim it was just facilitating what consumers could do anyway, but it violated the right of the record companies to associate with whom they wanted. Essentially, MP3.Com tried to force the record companies to do business with it, and it go shot down because of it. Having seen people expropriate my own intellectual property without permission, I cannot feel too sorry for MP3.Com.
On the other hand, if the record companies knew what was good for them they would reach a licensing agreement with some service like MP3.Com sooner rather than later. The ability to control recorded music is already out of their hands thanks to the convergence of cheap, powerful computers, the MP3 format and the widespread penetration of digital music in the form of the compact disk. Consumers seem completely unwilling to buy into the various Super CD-type schemes, and once the MP3 player market matures (give it another 2 years at most for Walkman-like penetration) the record companies will have some serious problems on their hands.
Source:
Ruling against MP3.com could cost $118 million. Jim Hu and Evan Hansen, CNet.Com, September 6, 2000.