MP3 sites like and Napster face the wrath of the music industry

By Ann Limpert
Updated May 12, 2000 at 04:00 AM EDT

It sounds like fodder for the inevitable network miniseries about the Internet era: Corporate giants gang up on innovative up-and-comer. At least that’s how CEO Michael Robertson feels. On April 28, his two-year-old company lost a civil suit brought by the RIAA, a trade group that represents 10 major record companies (including Time Warner’s Atlantic, Elektra, Sire, and Warner Bros.). U.S. district judge Jed Rakoff ruled that nearly all of the 45,000 CDs on’s My.MP3. com service (where users can store songs they’ve bought on site) were in violation of copyright law.

Though damages could range from a wrist-slapping few million dollars to a fatal $1 billion, Robertson hopes the two sides will settle. ”Every new media device has been challenged in courts,” he says. ”Take the VCR. I think there is a natural reaction to resist competition.” RIAA CEO and president Hilary Rosen issued a terse statement: ”We are pleased with the court’s decision today.” What does this mean for Joe Netscape? Jupiter Communications analyst Aram Sinnreich believes the ruling won’t squash future digital endeavors: ”Consumers are going to have to wait for the recording industry to work out the legitimate channels.” Still, this may foreshadow verdicts in other pending suits against (by Paul McCartney’s publishing company) and against online music server Napster (by angry artists Dr. Dre and Metallica). The Internet, it seems, is still waiting for its tune-up.