The RIAA explained that, under the agreement, it and all its
member labels and their licensees, including the new on-line
subscription services “Pressplay” and “Musicnet,” will immediately
have access to every musical work to be licensed by the Harry Fox
Agency. This agency is the largest in the industry for licensing
reproductions and distributions of musical works.
The agreement has been reached in advance of a final deal on
royalties although the RIAA will pay Harry Fox an advance of $1m
(£680 000) towards the unascertained royalties.
A certain amount of uncertainty still surrounds the agreement,
however. Jupiter Research analyst Aram Sinnreich said;
“It’s not even really a deal; it’s $1
million to forestall litigation until after the (subscription
services) launch…there’s a lot of unanswered questions about what
role the publishers will play in the digital music world.”
Analysts have noted that a similar deal struck with Napster last
month may be a source of tension since Napster agreed to pay the
significantly larger sum of $10 million. In addition, the extent of
consumer appetite for paid subscription services remains in
doubt.
