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MP3 distributors threatened with patent suit

Pay a one per cent royalty, MP3ers, or we'll take you to the cleaners...

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MP3 music site MP3.com was yesterday told to cough up a one per cent royalty on every music track it sells to a customer for download -- or face legal action. The bizarre demand was sent to MP3.com president Michael Robertson by Christopher J Reese, VP and general counsel for online music supplier Sightsound.com. Sightsound.com claims to be the owner to two US patents which it believes govern the downloading of audio and video files via the Internet and charging money for them. As a result, "Sightsound.com is offering a One Year Limited Patent License to [MP3.com] so that you can receive the protection of Patents 5,191,573 and 5,675,734. The royalty rate for the License is one per cent of the total price charged to customers per transaction for the download sale of music or other audio recordings", wrote Reese. And then: "Please understand that if you do not become an authorized licensee, you must immediately cease and desist from selling music, or other audio recordings, over the Internet in download fashion." The first patent, 5,191,573, refers to "a method of transmitting a desired digital video or audio signal" stored on one machine and sent to another "via a telecommunications line", and of "transferring money" by the same route. It was filed on 18 September 1990 and granted on 2 March 1993. The second patent is described in very similar terms, but was granted on 7 October 1997 on a filing made on 27 February 1996. While we at The Register would never claim to be experts in US patent law -- nor to offer advice upon it (knowing how bloody litigious they are over there) -- we are curious how these patents cover MP3.com's e-commerce activities, or anyone else's for that matter. Given they specify a "method" of downloading digital music and video, as opposed to the principle of downloading (which can't be patented), unless MP3.com is actually using that method, Sightsound.com's patents are surely not infringed. MP3.com presumably transmits files through a Web browser using standard protocols, and it's hard to believe that FTP and/or HTTP are the property of a small, little known Pennsylvanian e-commerce operation. It's interesting to note that Sightsound.com also claims to be a member of the Secure Digital Music Initiative (SDMI), it's not hard to imagine the more militant MP3 buffs decrying it all as some kind of music industry conspiracy to lay one on MP3.com. Sightsound.com's own site uses Macromedia Flash, and we'd be very surprised indeed if the Internet multimedia company had similarly paid its user a patent royalty. Incidentally, it also claims that, in its former guise as Digital Sightsound, it was, in 1995, the first company to "offer music for sale in a download fashion". We understand that Robertson has yet to respond to Sightsound.com's demands, but we'll be watching the case with interest. ®

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