TVT Records Drops Napster Lawsuit

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TVT Records has become the first record label to officially drop copyright infringement charges against free digital music file-sharing service Napster Inc.

TVT officials reported yesterday that the decision, reached Wednesday, was influenced by the new subscription service Napster is developing with recording industry heavyweight Bertelsmann AG.

According to terms of the deal, TVT will allow the master recordings and musical compositions it owns or controls to be used for file sharing on the Napster service. TVT will join Napster in promoting further acceptance of the new Napster business model.

Earlier this month, the Napster Beta 9 was made available for download. This version sports a link to CDNOW -- a division of the Bertelsmann eCommerce Group -- and allows users to search for and buy any of CDNOW's 500,000 items.

Bertelsmann and the Recording Industry Association of America sued Napster in 1999 after the association alleged that Napster's service facilitated mass copyright infringement. Since then, Napster and Bertelsmann have struck an agreement to work together, but Bertelsmann reportedly will not drop its portion of the RIAA lawsuit until a subscription-based service goes live.

The two companies began work on this subscription service last year. Napster maintains that a free service will still be available to users once the subscription service goes live.

The deal extended CDNOW's reach into the Napster file-sharing community, which has grown to 51 million members, Napster spokeswoman Karen DeMarco said.

DeMarco was unaware of any Napster marketing initiatives under way to promote the availability of the Napster Beta 9. CDNOW did not return calls for comment.

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