Music Licensing Battle Hits DC

In February 2000, when a RealNetworks executive showed up before a House subcommittee, the company stressed that Congress must not tinker with the high-revving Internet economy. "We are not asking for government regulation or intervention," advised RealNetworks vice president Alex Alben, "and believe none is required at this time." Perhaps it's a sign the digital music market has matured -- or a reflection of the company's sobering share price, down to $12.78 from a high of nearly $100 -- but 15 months later, RealNetworks now has changed its tune. Rep. Howard Berman of California, the panel's ranking Democrat, held out the possibility of some congressional action, but even he didn't seem optimistic. Berman represents the San Fernando valley region near Los Angeles, home to Disney's headquarters and scores of other content firms. "While the music industry may have been slow in getting online, the pace of online deals has quickened," Berman said. "I'm not sure there is great need at this moment for sweeping legislation." Berman offered some free relationship counseling: "I do believe you can work that process out. Everything will go easier if you guys can work together.... Your best defense against this new generation of peer-to-peer services is to offer permanent downloads at a reasonable price."