This week's MP3.com sale could signal the end of the brief online music revolution.
Vivendi Universal's acquisition is further evidence that the online music's era of raucous, market-shaking experimentation is fading.
Although its star was eclipsed by Napster in the last two years, MP3.com and CEO Michael Robertson were standard-bearers for an often quixotic campaign against the major record labels as online music grew into a mainstream phenomenon in the late 1990s.
Launched before Robertson had experience with the music business, MP3.com made as many enemies as admirers as it flicked through business plans like tracks on a CD.
Vivendi Universal announced on Sunday that it would purchase MP3.com for about US$350 million, a move that follows Napster's own deal with media conglomerate Bertelsmann. Both deals mark a critical moment of detente and an admission that the labels need the help of their one-time enemies as they get serious about online distribution.
The deal "is a very symbolic nail in the coffin for the concept of the Internet as a liberating force from the major music labels," said Aram Sinnreich, a music analyst with Jupiter Research. "It will probably silence all but the most die-hard zealots who believe that the Internet makes the record labels irrelevant in this day and age."
Some skeptics say the deal also marks the culmination of a strategy designed to isolate the one-time upstarts. Analysts say a successive combination of lawsuits and restrictive licensing plans has been responsible for crippling the first generations of online music companies, making them easy targets for acquisition by the big media conglomerates.
"Vivendi Universal very aggressively pursued copyright lawsuits, driving the valuation down so that the company could be acquired," said Eric Sheirer, a music analyst with Forrester Research. "It's surprising that (this deal) hasn't been done with more attention (by) Congress."
End of the revolution?
To be sure, even if high-profile companies such as Napster and MP3.com are losing their rebellious reputations, a few services still remain as potential alternatives.
Swapping services including Gnutella and Music City continue to operate, although with far less music than Napster provided at its peak. If paid subscription services from the record companies don't give consumers what they want, these alternatives could again provide a place for disgruntled listeners to congregate and swap files.
MP3.com didn't foment the boom in online music, which stretches back into the early 1990s. But for a few years after it launched in October 1997, the site and its outspoken CEO were one of the trend's most visible leaders.
Robertson had little experience with the music industry when he created the first version of MP3.com, knowing that the term "MP3" had become one of the most popular things people were searching for on sites such as Yahoo and AltaVista. He bought the Net address for just US$1,000 from a person who had registered it for a personal Web site and created a home for thousands of independent musicians online.
