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EU Online Music Pact May Be Model For U.S.

Amazon, EMI, Apple, and Universal took part in the agreement, which could have ramifications for U.S. regulatory action.
The delivery of online music in the European Union is slated to get easier after the EU's antitrust agency reached an agreement this week with a group of firms supplying online music to consumers.

While details of the pact have not yet been made public, it is likely the deal could have ramifications for the U.S. because in recent years, European antitrust enforcers have been more aggressive than their U.S. counterparts. The EU online music agreement and an earlier Microsoft agreement as well as EU regulatory complaints against Intel could serve as examples as new antitrust officials in the U.S. Department of Justice say they will be more aggressive in the U.S.

In a speech in Brussels, the EU's competition chief Neelie Kroes called the agreement "a great breakthrough in online music" and said the agreement is expected to create a common roadmap across the industry and across the EU's 27 nations that should lead to widespread delivery of music.

Kroes said that the various companies and consumer groups involved in negotiations "recognized that current licensing mechanisms are too complex and burdensome, and that simpler licensing solutions are needed. This will not only help expand the market and tackle piracy, but also give consumers access to more of the music they want."

In cumbersome arrangements, European consumers have had to arrange with individual countries for online music downloads. That scenario forced Apple, for instance, to obtain licenses in each country. In addition to the companies participating in the negotiations leading to the agreement, major European consumer organizations also participated in the talks.

"Apple looks set to make iTunes available in more EU member states and Amazon is now enabling delivery of all physical product categories into all 27 Member States," said Kroes.

She said that in addition to consumer groups and artist societies, the key players hammering out the agreement included Amazon, EMI, Apple, and Universal.

The agreement could have ramifications for U.S. regulatory action, which lagged during the Bush Administration, but is taking on new life under the Obama Administration. Competition pacts arrived at in Europe could represent precedents for the U.S.

In her speech this week Kroes also crowed about the "promising" agreement reached with Microsoft after several years of onerous litigation between the software company and EU antitrust enforcers in which the software firm has agreed to offer European consumers a choice of web browsers.

"In the new year, we hope that hundreds of millions of consumers in Europe will get a choice of which Web browser to use on their computers," she said. "In IT we have stopped dominant companies abusing their position to restrict consumer choice Our message to these companies is: You can't run away or spend your way around Europe's rules."

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