U.S. Ends Online Music Antitrust Probe

By | December 24, 2003 at 12:00 AM

The Justice Department on Tuesday ended its two-year-old antitrust investigation into the music industry’s online ventures, finding ample competition exists in today’s world of digital music.

“Consumers now have available to them an increasing variety of authorized outlets from which they can purchase digital music and consumers are using those services in growing numbers,” said R. Hewitt Pate, assistant attorney general for the antitrust division.

The investigation, begun in 2001, involved joint ventures put together by major record labels, pressplay and MusicNet, to distribute music over the Internet. Before that, the labels had authorized no Internet businesses to provide consumers a way of searching and downloading songs.

The Roxio software company recently bought pressplay from Sony Music Entertainment and Universal Music Group. MusicNet is a venture by Warner Music Group, EMI Group, BMG Music and the RealNetworks medica company.

After their initial launch, the Justice Department said the two ventures drew criticism because the songs couldn’t be transferred from computer to computer or transferred onto a portable device or CD. Later, both offered improved services.

The Justice Department said it could find no evidence that the record labels had used the ventures to suppress Internet distribution of music. In fact, the labels now license songs to several other online ventures that offer them to consumers.

In addition, the investigation concluded that there were no impermissible terms used by the labels to license music to third-party providers.