Universal Music Group is suing MySpace for copyright infringement. "The lawsuit alleges that MySpace encourages copyright infringement by taking proactive measures such as reformatting music to better suit Web browsers and offering means to share the material with others" says MartketWatch.

MySpace rejoins:

"We are in full compliance with the Digital Millennium Copyright Act and have no doubt we will prevail in court," a spokesman for the social networking Web site said in a statement. "Moreover, we proactively take steps to filter unauthorized music sound recordings and have implemented audio fingerprinting technology," the statement said.

MySpace is owned by NewsCorp, which has a strong interest in protecting its own intellectual property, which makes the situation very interesting.

Other forms of integration are also occuring in the music biz. For example, UMG and Microsoft recently ageed that MS will pay UMG a chunk of the revenue from sales of Zune.

These moves are not surprising. Text book business analysis says that as it becomes more difficult to monetize particular assets, firms will pay attention to complements or channels that can be protected and monetized. Thus, it make sense for Microsoft to pay part of the revenues from the Zune to UMG -- Apple, which is fully integrated, makes its money from selling the iPod, not from iTunes. So the MS/UMG deal can be seen as a partial integration directed toward the same end.

posted by James DeLong @ 8:38 AM | Enforcement & Remedies

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