Senate Panel Hears Digital Music Debate

Rock stars, music labels and Napster Inc. executives squared off in a Senate hearing Tuesday over whether the government should push the recording industry to accelerate its efforts to sell music on the Internet.

Though some senators expressed frustration at the industry’s slow pace, few seemed ready to jump into the fray with legislation that would force music labels to license their content to Internet retailers.

“I’d like this to be done without the almighty hand of government,” said Senate Judiciary Committee Chairman Orrin G. Hatch (R-Utah), who has been pushing the recording industry to embrace technologies that would enable consumers to buy and listen to digital music files.

Sen. Maria Cantwell (D-Wash.) said she was encouraged by the licensing deal reached Monday by AOL Time Warner, EMI and Bertelsmann, which announced a joint venture called MusicNet that will offer digital music downloads by the end of the year. “There has been a lot of progress here,” Cantwell said.

Singer Don Henley, co-founder of the Recording Artists Coalition, said Congress should consider a compulsory licensing law only as a last resort. But Henley, one of 15 who testified at the hearing, blasted the recording industry for “[fiddling] on the sidelines while the digital revolution went on without them.”

Henley complained that he and other recording artists had been shut out of the digital music debate, which he likened to watching a pingpong match between music labels and Internet companies.

“Artists are simply asking for a seat at the table,” Henley told the Judiciary Committee.

He and singer Alanis Morissette urged the panel to ensure that artists receive a fair share of the royalties generated through online music sales and asked for lawmakers’ help in resolving other contract and compensation battles with music labels.

Hatch, a part-time songwriter, vowed to conduct additional hearings looking into the artists’ concerns. “Without you, there would be nothing,” Hatch said.

Expected protests failed to materialize. Several dozen Napster fans--many wearing free Napster T-shirts the company gave them to attend--lined the back of the room, but they listened quietly during the nearly four-hour hearing. Napster founder Shawn Fanning, 20, arrived in a suit and tie and without the trademark baseball cap he wore at a Napster “teach-in” Monday night in Washington.

Napster Chief Executive Hank Barry told the committee that the music labels had refused to negotiate with his company to license their copyrighted material. He said lawmakers should force labels to license their music to Napster and other companies, much as Congress requires cable operators to carry certain local television stations.

“I believe it will take an act of Congress, a change to the laws, to provide a compulsory license for the transmission of music over the Internet,” Barry said. “Separate individual negotiations for all these rights are simply not a viable option.”

Recording industry executives told the committee that they already license some of their music online and plan to offer more by the end of the year. They said they will work with Napster, but only after the company has halted the unauthorized trading of copyrighted songs on its system.

Richard Parsons, co-chief operating officer at AOL Time Warner, said it would be absurd to try to regulate an industry that “doesn’t even exist yet.” He urged lawmakers to have faith in market-driven competition. “Progress is being made,” he told the committee.

“It seems to be very slow in the making,” Hatch responded.

As an alternative to mandatory licensing, Hatch encouraged participants to consider whether the government might be able to offer tax breaks or other incentives to speed the development of online-music platforms.

EMI Chief Executive Ken Berry blamed Napster for part of the delay over the last year in delivering online music.

“Some of the companies to whom we have licensed our rights are finding it difficult to build viable businesses in an environment dominated by the unlawful free downloading of our entire catalog,” Berry said.

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Previous Times articles on Napster and copyright law are at https://www.latimes.com/musicweb