Sony Connect, Sony Corp. of America's online music service, will launch May 4 with a promo event featuring Sheryl Crow performing live on a United Airlines aircraft traveling from Chicago to Los Angel




Breaking News

Rep. Seeks To Curb Outsourcing In Film

By Bill Holland

WASHINGTON--Rep. Diane E. Watson, D-Cal., applauds the reconstitution of Hollywood Labor Coalition, organized by the Los Angeles County Federation of Labor, and is pledging to work with the group to curb the outsourcing of jobs in the film industry.

"I've asked the member unions of the Hollywood Labor Coalition to make a presentation to the Congressional Entertainment Caucus in Washington, D.C., on the impact of runaway production on U.S. jobs and the economy and other issues of interest," Watson said in an April 23 statement. "Runaway production is a very real and serious problem that has caused many job losses in my district."

Watson says she recently sent a letter, signed by 26 other members of Congress,to Jack Valenti, chairman/CEO of the Motion Picture Assn. of America that addresses the issue. She also reiterated her support for Senate tax incentive legislation in Congress aimed at curbing runaway production.

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Microsoft Digs In Heels For EU Appeal

By Paul Resnikoff

BOSTON (DigitalMusicNews)--Microsoft is gearing up for a prolonged appeal of the recent EU anti-competitive ruling, which aimed to cripple the software maker's dominant market position.

In a contentious seven-page letter to the European Commission, Microsoft argues that the EU decision will ultimately curtail innovation and compromise intellectual property rights.

"The novel legal standards announced in the Decision will affect all industries, altering market dynamics and reducing incentives for research and development that are essential to global growth," the letter states.

The EU recently issued a heavy fine and will force the software maker to offer versions of its operating system that do not bundle the Windows Media Player. The EU will decide June 8 whether Microsoft is eligible for appeal.

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Nielsen Eyes Sports Sponsorship Service

By Gail Schiller

LOS ANGELES (Hollywood Reporter)--Nielsen Sports, a unit of Nielsen Media Research, will launch a service this summer to measure televised sports sponsorships such as in-stadium signage, live broadcast promotions and audio mentions.

The new Web-delivered service, called Sponsorship Scorecard, will give national sports teams, advertisers, agencies, television stations and broadcast and cable networks access to data on the number of adult viewers exposed to corporate sponsorships during any televised sporting event as well as the amount of time viewers were exposed to the sponsorships.

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Crow Flies for United Air, Sony

By Chris Marlowe

LOS ANGELES (Hollywood Reporter)--Sony Connect, Sony Corp. of America's online music service, will launch May 4 with a promo event featuring Sheryl Crow performing live on a United Airlines aircraft traveling from Chicago to Los Angeles.

United, Sony Connect and Sony Electronics will co-host the flight, which also will unveil the airline's MileagePlusMusic.com service and Sony's new Hi-MD Digital Walkman players.

Sony Connect general manager Jay Samit says the service will have more than 500,000 tracks from major and independent labels available when it goes live, each of which will cost 99 cents with entire albums costing $9.95. The service will also be international, with localized versions in the United Kingdom, Germany and France.

A relationship with United will make selected tracks from Crow's performance available for download at Mileageplusmusic.com. In addition, the 43-million members of the United Mileage Plus program will be able to earn and redeem Mileage Plus miles for music at Connect.com.

"This isn't just a stunt," Samit says. "This is the beginning of a meaningful partnership."

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Washington Report

China's Piracy Pledge Not Convincing?

By Bill Holland

WASHINGTON--"It is what it is." That's what the record industry's top "China hand" thinks of the Chinese government's April 21 pledge to introduce copyright reforms.

Late last week, China pledged to reduce physical goods piracy through a nationwidecampaign coordinated at the national, provincial and local level by vice premier, Wu Yi.

The Chinese government also pledged that enforcement authorities will criminally prosecute those responsible for physical and online commercial piracy in China.

Neil Turkewitz, executive VP, International for the Recording Industry Assn. of America, says he's not skeptical of China's pledges, "but this was an announcement, not an agreement. The breakthrough will come when something happens."

Turkewitz has traveled to China many times in the last decade to hash out piracy concerns, initially with former RIAA chief and now IFPI chairman, Jay Berman.

After much RIAA negotiating along with the U.S. Trade Representative in the mid-'90s, China initiated a program to eradicate the exportation of pirate CDs "that has been extremely successful," he says.

But domestic piracy--pirated product inside China--as well as market entrance problems remain. Ninety percent of domestic CDs in China are bogus, according to some estimates.

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FBI's Piracy Crack-Down Continues

By Paul Resnikoff

BOSTON (DigitalMusicNews)--The FBI recently conducted 120 raids in the United States and abroad against piracy operations, part of a larger effort to crack down on warez piracy groups.

About 100 people in the States and overseas have been identified in the theft of more than $50 million in music, movies, games and computer software.

The FBI joined forces in February with the RIAA and MPAA to create "Operation Fastlink" in response to the continued growth of large piracy centers.

Warez group members often have highly specific roles, including studio insiders that acquire pre-release bootleggers, decoders, quality assurance specialists that test the final product, and distributors that specialize in populating content across a wide swatch of P2P applications and sites.

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Future of Music Summit Sure To Fuel Debate

By Bill Holland

WASHINGTON--The first panel at the Future of Music's annual policy summit in D.C. on May 2 and 3 is certain to generate fireworks.

One of the subjects of the 9:15 am ET Sunday panel is whether illegal downloading had led to decreased industry sales. Two university economists with totally different file-sharing data conclusions will face off.

Stan Liebowitz, a professor at the University of Texas, says his research indicates that file-sharing has definitely hurt the industry. Meanwhile, Koleman Strumpf, an associate professor at University of North Carolina at Chapel Hill, says his studies conclude that the practice is not the cause of the industry's decline.

And Mary Madden, a research specialist at Pew Internet & American Life Project, is expected to release a study analyzing musicians' views about distributing music through the Internet. A FMC executive director who has seen the initial findings of 3,000 musicians polled, says "50% are enthusiastic and embrace it and 50% are lukewarm or terrified."

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Spyware Hearing Set For April 29

By Bill Holland


WASHINGTON--Rep. Cliff Stearns, R-Fla., chairman of the House Energy and Commerce Subcommittee on Commerce, Trade and Consumer Protection, has scheduled a hearing on April 29 to probe Internet technology that can lead to identity theft.

The hearing, entitled "Spyware: What You Don't Know Can Hurt You," is scheduled fort 10 a.m. ET in room 2123 of the Rayburn House Office Building.



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International Section

EU Urged To Pressure Russia On IP

By Emmanuel Legrand

LONDON--International trade body the IFPI is urging European Commission president Romano Prodi to press the Russian government to take action on intellectual property issues.

Russia is currently negotiating its admission to the World Trade Organization. The IFPI is adamant that "effective action" on intellectual property should be set as a condition of Russia's admission to WTO.

IFPI chairman and CEO Jay Berman comments, "I cannot emphasize enough the need for the Commission to ensure that Russia implements the international intellectual property rules in the TRIPS Agreement in word and spirit before it can be admitted to the WTO."

Prodi and seven EU Commissioners were visiting Russia last week, including trade commissioner Pascal Lamy. Berman met with Lamy a couple of weeks ago to discuss a wide range of issues, among them the situation in Russia.

Berman emphasized to Lamy that the Commission has to address what he describes as "unacceptably high levels of music piracy" in Russia.

According to IFPI, Russia is "the number one source of illegal music recordings" in the European Union and Accession countries (term used to identify the new countries joining or willing to join the EU) and "the second largest pirate music manufacturer in the world."

Berman says it is imperative that Russia bring levels of intellectual property protection in line with EU and international standards.

Another bone of contention is Russia failing to meet its deadlines regarding IP protection. According to the EU-Russia "Partnership & Cooperation Agreement," Russia was due to provide by January 2003 a similar level of IP protection in Russia as exists in the EU. "Fifteen months after this deadline, Russia is still far from fulfilling this obligation," notes the IFPI.

Russian copyright law does not provide any protection whatsoever for pre-1995 recordings.

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London Film-Promo Group Bows

By Stuart Kemp

LONDON (Hollywood Reporter)--The Mayor of London, film industry executives and entertainers turned out last Thursday for the launch of Film London, a startup agency charged with promoting the film and media business here.

The group is expected to kick-start a slew of initiatives to encourage filmmaking in London as well as cut through the bureaucracy facing filmmakers working in the British capital. The new body is backed by more than £3 million ($5.3 million) from sources including the U.K. Film Council and the London Development Agency.

London Mayor Ken Livingstone says: "London must become a more film-friendly city to compete with other major filmmaking cities around the world. With so many agencies involved in whether a film gets made in the capital, it is important to have a strategic agency with both a commercial and cultural role to promote and encourage film."

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Berlusconi Slammed For Undue Media Control

By Leo Cendrowicz

BRUSSELS--Italian prime minister and media mogul Silvio Berlusconi was censured by the European Parliament last Thursday for maintaining undue control over Italian broadcasting despite pledging three years ago to divest his media interests.

The Parliament vote in Strasbourg, France, was backed by 237 votes, with just 24 against. It passed despite Berlusconi's Forza Italia party attempting to derail the action by attaching some 338 amendments.

The censure resolution calls for laws to prevent politicians or candidates from having major media interests and urges the European Commission to draft a proposal to prevent media monopoly abuses.

"The Italian system presents an anomaly, owing to a unique combination of economic, political and media power in the hands of one man," said the resolution, which was drafted by Dutch liberal democrat Johanna Boogerd-Quaak.

In addition to being the Italian prime minister, Berlusconi owns Mediaset, the largest private television group in Italy.

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Japan Launches Entertainment Lawyer Network

By Steve McClure

TOKYO--Several leading Japanese industry figures and attorneys have established a new organization called the Entertainment Lawyers Network (ELN).

It is the first group of its kind in Japan, where there are far fewer lawyers on a per-capita basis than in other industrialized countries.

The creation of ELN reflects the Japanese entertainment industry's increasing awareness of the need to protect copyright both domestically and overseas and to bring its practices in line with international norms.

Another reason for the network is to encourage more young Japanese lawyers to specialize in entertainment-related work.

Among those announcing the launch was Recording Industry Assn. of Japan chairman Tom Yoda, who is also chairman of indie conglomerate Avex.

"As seen in various entertainment cases in the U.S., lawyers are deeply-involved in entertainment business," says Yoda. "The Entertainment Lawyers Network is the team-up of lawyers and industrialists in content business. One of its main objects is to foster advanced specialists in entertainment business, and I believe this establishment of Network means a great deal for the healthy development of entertainment content business including music."

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MTV Intl Pours Cash In New Programming

By Kate Bulkey

LONDON (Hollywood Reporter)--MTV International is pumping an undisclosed multi-million-pound sum into a slew of new programming that it aims to distribute worldwide, says Brent Hansen, president of creative at MTV Networks International.

The development slate is the first from a new MTV international creative group and includes a mix of pilots and greenlighted projects. Projects range from a global version of reality dating show "Globally Dismissed" to an animation pilot called "Happy Tree Friends" and a global version of "Cribs," which looks around stars' homes.

A gamut of genres will be covered by the new creative group, from music and reality to comedy, animation and game show formats. There is a longform drama called "Top Buzzer" that Hansen says will act as an "internal training exercise" to let MTV learn about this program genre.

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Dream Makers & Deal Breakers

This Week's Dream Makers & Deal Breakers:

- Veteran publisher/manager Edwin Oliver has launched First Tribe Music Group, a division of First Tribe Media. Formerly a creative director with Disney's publishing arm, Oliver plans to release product on the new label this fall. Distribution is still being negotiated. First Tribe has signed Ahnjel Harris and Minister Vernon Chappel. Harris recently appeared as Nala on Broadway in "Lion King." Chappel is currently musical director at "The River" church in Raleigh N.C. Harris. Based in Signal Hill, Calif., First Tribe Media is owned by Oliver and his wife Michele. The company also has a management division and a film/television production operation. The management arm represents record producers Logan Reynolds, Antonio Dixon and Mano Hanes.


- Lyric Street Records in Nashville promotes Teresa Russell to senior manager of artist and label relations. She was manager of operations.


- Universal Music & Video Distribution in Universal City, Calif., names Steve Wengert VP of catalog of classics, jazz and associated labels. He was West Coast national label representative at Interscope Geffen A&M Records.


- Universal Music Group in New York appoints Maria Ho VP of corporate communications, and promotes Grant Pavolka to director/chief of staff of corporate communications. Ho was Zomba Music director of corporate communications and Jive Records director of artist publicity. Pavolka was manager of corporate communications.


Contributors: Carla Hay and Deborah Evans Price

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Commentary

Majors Keen On Film, TV Music

By Chuck Crisafulli

The songs remain the same. But the business seems to be changing daily. At a time when corporate mergers, acquisitions, consolidations, and realignments are continually shifting the music industry landscape, the licensing of music for usage in film and television has become an increasingly central focus.

And as the major labels struggle in the midst of these shake-ups to improve their bottom line, licensing has proven a prime catalyst in restructuring and streamlining divisions that tally a sizable portion of revenue from the sector.

For major labels, licensing has become an increasingly significant revenue generator as radio playlists have narrowed and record sales have slumped. Film, TV and commercial placements are now seen as a legitimate and lucrative way to either break a new band or as a way to exploit and reinvigorate catalog classics. For creators of film and television, the creative and commercial benefits of achieving just the right match of music and picture are as compelling as ever.

"There appear to be more opportunities to license to film and TV than ever before," says Martin Bandier, who, as chairman and CEO of EMI Music Publishing, oversees a catalog of a million-plus titles ranging from "Santa Claus Is Coming to Town" to "Louie Louie."

"Last season, we had over 100 songs that we licensed to (Fox's) 'American Idol' alone. Our synchronization area has had double-digit compound annual growth for the past 10 years. The licensing area is a spectacular one, and it has enabled our company to grow and to have a better profit picture in spite of the declining and sometimes free-falling recorded music market," Bandier says.

A year ago, some of EMI Music Publishing's sister companies went through a restructuring, leading to the creation of an EMI Music Marketing division that encompasses licensing of masters, catalog developments and special markets efforts. But Bandier says that kind of reorganization has not changed his relationship with the label side of EMI or the way that licensing deals are approached.

"This business changes on an hourly basis," he laughs. "But quite often the changes at the top don't really change the way that business actually gets done."

The latest and most significant change in the music world took place in March, when Edgar Bronfman Jr. and a team of investors completed their purchase of the Warner Music Group. That deal included both the publishing arm Warner/Chappell Music, as well as Warner Strategic Marketing, which serves as the central licensing and catalog development division for the company and includes Rhino Entertainment, Warner Music Group Soundtracks, WSM Home Video, Warner Special Products and WMG's television marketing department.

The WMG sale led to back-office consolidation, extensive layoffs and a flurry of executive changes. But for those on the licensing front lines, business hasn't changed much. "I'm down to a staff of three, from a staff of five. I need a new business card, but I don't anticipate the way we do business will change much," Warner/Chappell senior vp film and television Brad Rosenberger says.

"We administered the Warner Bros. catalog and will continue to do so. The film and TV studios aren't sister companies anymore, but it's not like anybody ever got a 50% discount on anything for being family. We'll continue to work closely with Warner Bros. Studios. But my job is the same as it was before--to get as much of our stuff placed in a project no matter what the studio is," Rosenberger says.

WSM senior vp Mark Pinkus, who has been heading up the sync licensing department for the past nine months, says the pressure his staff feels is less from the corporate transition and more from the pace of business-as-usual.

"We saw a greater than 10% increase in requests from 2002-'03, and the pace that we're on this year is greater than that--the number of requests coming in is stronger than ever," Pinkus notes.

"There's a great focus now on the bottom lines. Everyone wants to hit their quarterly and yearly numbers, and that pressure certainly exists within Warner Strategic Marketing. But I believe that pressure exists within the entire industry," he adds.

Chuck Crisafulli is a contributor for Billboard sister publication The Hollywood Reporter.

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Case Analyses

WIPO Backs Eminem In Name Dispute

By Emmanuel Legrand

GENEVA--The arbitration and mediation center from the World Intellectual Property Organization has ruled in favor of U.S. artist Marshall B. Mathers III, better known as Eminem, in a trademark dispute.

Mathers was a complainant against British company Visitair Ltd and its principal Tim Mcintosh regarding the domain name eminemmobile.com.

The domain name in dispute was registered with CSL Computer Service Langenbach GmbH dba Joker.com on March 19, 2003 by Mcintosh.

Eminem Mobile claims to have "the largest selection of Eminem mobile on the World Wide Web," with ringtones, logos, animations and picture messages all based on Eminem works. It also says in a disclaimer that it is "an independent and unofficial site and is in no way endorsed, affiliated or connected with the artist himself."

Mathers filed a complaint with the WIPO Arbitration and Mediation Centre on Feb. 24. The arbitration panel formally notified Visitair Ltd and Mcintosh of the complaint, and the proceedings commenced on March 4, 2004. The panel appointed by the WIPO said that the respondent failed to submit any response.

In its ruling, the panel noted that Mathers was "a most popular music and recording artist, (who) owns all rights, titles and interests in and to the name and trade mark Eminem," and that he performs under this trade mark at least since 1996.

WIPO notes that neither Mathers, nor his licensee "has given any consent, license or authorisation" to any person, including Mcintosh, for any use or registration of the domain name in dispute.

WIPO's panel found that: (1) The domain name registered by Mcintosh is identical or confusingly similar to a trademark or service mark in which Mathers has rights; (2) Mathers has no rights or legitimate interest with respect to the domain name; (3) The domain name has been registered and is being used in bad faith.

Therefore, the panel ruled on April 7 that the domain name eminemmobile.com be transferred to Mathers.

CLICK HERE To View The Entire Proceedings.

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Recent Cases & Filings:




Case: EMI April Music v. Electronic Arts
Issue: Copyright infringement; unlawful use of copyrighted songs without paying appropriate license fees
Cite: U.S. District Court for the Southern District of NY, CV-3065
Filing attorney: L. Peter Parcher of Manatt Phelps & Phillips



Case: Kenneth Gamble v. Sony Music Entertainment
Issue: Breach of contract and fiduciary duty
Cite: NY Supreme Court, 601082
Filing attorney: Oren Warchavsky of Gibbons Del Deo





Case: Studiocanal Image SA v. Legation Music; Diplomat Music; Largo Music
Issue: Breach of contract
Cite: NY Supreme Court, 601065
Filing attorney: Christian Carbone of Loeb & Loeb




Case: George Brown v. Delightful Music; Warner-Tammerlane Publishing; WB Music
Issue: Plaintiffs seeks to dissolve administration agreement
Cite: NY Supreme Court, 601089
Filing attorney: Jack Scherer


Case: Wells Fargo Bank vs. S.C., Inc. (formerly known as Gazzarri's Inc.)
Issue: Lender Wells Fargo claims that S.C., which leases a Sunset Boulevard property in L.A.--now the Key Club, and formerly Billboard Live and Gazzarri's--failed to pay property taxes and insurance. The bank also alleges that S.C. has sublet the property to the Key Club.
Cite: Superior Court of California, County of Los Angeles, BC314099
Filing attorney: Steven T. Graham and Michelle S. Dangler of Snell & Wilmer; Frank Revere of Revere & Wallace.










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