Indies Accusing MySpace, Major Record Labels of Possible Collusion

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Indies Accusing MySpace, Major Record Labels of Possible Collusion

Thu Sep 25, 2008 @ 01:24AM PST

By Eriq Gardner

Myspace20logoMySpace has been a respected breeding ground for independent musicians. But is the social networking website about to provoke a major backlash?

News Corp., which owns the site, is about to launch an online retail spin-off called MySpace Music, which many hope will compete with industry leader Apple iTunes. According to the Register, the upstart service has secured the catalogues of three major record companies, possibly by giving them equity. However, the paper also reports that independent labels are being excluded from the service over an inability to secure song rights. Many indiess don't have worldwide rights over songs — only certain territorial rights — and MySpace Music is requiring worldwide rights clearance in order to stave off any copyright infringement claims.

Or at least that's one theory. Another?

The other theory goes that News Corp. is in bed with the major music labels and are purposefully using this rights issue to give the majors a leg up.

The Independent Music Companies Association says it is asking antitrust authorities at the European Commission to investigate the "suspicious" arrangement.

A MySpace Music spokesperson has responded to the scuttlebutt by saying, "We are not aware of any antitrust complaint or inquiry pending against either MySpace or MySpace Music. MySpace Music welcomes indie artists and is not blocking content from them or other labels. Our goal is to provide the indie community with powerful tools and monetization channels to enable them to access revenue streams previously unavailable.”

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The Hollywood Reporter, Esq. blog focuses on how the entertainment and media industries are impacted and influenced by the law. It is edited by Matthew Belloni with contributions from veteran legal reporter Eriq Gardner and others. Before joining The Hollywood Reporter, Belloni was a lawyer at an entertainment litigation firm in Los Angeles. He writes a column for THR devoted to entertainment law. Gardner is a New York-based writer and legal journalist. Send tips or comments to Matthew.Belloni@thr.com

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