EMusic Software to Block Napster Users....continued

EMusic, which sells music in the form of digital files that can be downloaded onto personal computers, has designed software that scans and analyzes the digital music files on the Napster service. The "acoustic fingerprinting" software determines whether those files were originally downloaded from EMusic and sends messages requesting their rapid withdrawal from Napster's service. EMusic's catalog includes acts like Elvis Costello, They Might Be Giants, and Phish. Napster, which is being sued over copyright claims, allows users logged on to the Internet to see the music files that others have stored in their computers. Using Napster's software, users can search and download songs from other people's computers. The vast majority of these songs have not been licensed from artists, recording companies, or publishers. EMusic's move underscores the security and copyright issues raised by downloadable music technology. New formats, such as MP3, which is used by both EMusic and Napster, have created the potential to store, send, and listen to music in the form of small digital files. The world's five largest record labels -- Warner Bros., Sony Music, Universal Music, BMG, and EMI -- are suing Napster for copyright infringement. Napster has denied the charge. "We have artists and labels who have embraced technology," EMusic chief executive Gene Hoffman told Reuters. "These are people who trust their customers. This software gives them a way to continue to trust those customers." If the software finds an EMusic file on Napster, the software sends an automatic message to the user who had designated that file for sharing via Napster, asking him or her to withdraw the song from the Napster service within 24 hours. If the Napster user fails to comply, EMusic will ask Napster to block that person from using the song-swapping service. Hoffman acknowledged that the software was not the most "elegant" way of dealing with the problem. He said, however, that Napster had refused to implement what he called the easiest solution, which would be to block access to those songs, based on the software's analysis of the files. Napster's chief executive Hank Barry said the company reviewed EMusic's proposal last week. "We do not believe that their approach was consistent with the Digital Millennium Copyright Act and it is not technologically feasible," he said Tuesday. Napster to review software "It appears that EMusic's announcement today is different than what they had proposed to us previously," Barry said in a statement. He said that Napster would review EMusic's's initiative "to determine if it is consistent with Napster's privacy policy." "The truth is that they are unwilling to do this," Hoffman said in a conference call with reporters. "It means that Napster would rather shut down user accounts than deal directly with the problem of illegal distribution of files." EMusic has no objection to its customers making copies of its music for personal use, Hoffman told Reuters. "We're not interested in going after someone who makes a copy of a song for a friend," he said. "But if you make that song available via Napster, that is a violation of copyright law, and that's what we're trying to stop." EMusic has not yet filed a lawsuit against Napster. "But it's an option that we're considering," Hoffman told Reuters. "We would much rather pursue an amicable solution." EMusic said in July it had opened negotiations with Napster to discuss joint marketing and other possible collaborations. Hoffman said Tuesday that he was still interested in such efforts. "We would love to be able to pay (Napster) on a per-head basis to drive subscribers into our system," Hoffman said in the conference call. He also expressed interest in a possible catalog licensing deal with Napster in the future. "I think that's one of the reasons we're not suing yet," he said.