Merlin have reservations about Virgin download proposal

By | Published on Tuesday 30 March 2010

According to Music Week, the independent labels are yet to be convinced by the offer being made by Virgin Media to launch some sort of all-you-can-eat download service, most likely as part of an ISP package.

As previously reported, Universal last year gave its support to a truly all-you-can-eat MP3 download service, but the other majors are yet to be convinced that Virgin’s proposals are workable, with some fearing a properly all-you-can-eat MP3 platform could cannibalise other digital music services, iTunes in particular, which have become a good income stream in the last few years.

Music Week has published a memo which shows that Merlin, which represents the big independents on digital licensing issues, are also unhappy with the exact proposal Virgin has put on their table. Though it may be that Merlin object to the specific deal currently being offered, rather than the actual concept of all-you-can-eat MP3s. The memo says: “Although we are deep into negotiations with Virgin Media, we do not believe we have yet reached a point where Virgin Media’s offer in our view acceptably values a collective licence to our members’ repertoire”. But it adds that Merlin bosses are confident a deal can eventually be done.

Some in the indie community had previously worked with Virgin with a view to launching a licensed P2P file-sharing network, which arguably is just another way of positioning an all-you-can-eat MP3 service, though those plans were scuppered by major label resistance. Whether Virgin could or would launch its new digital service without the indies on board we don’t know, though it seems increasingly likely this new Virgin plan will be scuppered by the majors too, so it is unlikely the importance of the indies to the ISP will ever be properly tested.