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RIAA sues MP3.com, alleges copyright violations
January 21, 2000 -
MP3.com's new features get mixed reception
January 12, 2000
The company posted a pro forma net loss of $10.6 million, or 17 cents per share, for the fourth quarter ending Dec. 31. In the same period a year earlier, the company made $102, 431.
Revenues for the quarter reached $15.3 million, up from $613,116 in the year-ago period and $4.1 million in the previous quarter.
Analysts polled by First Call had projected a loss of 23 cents per share.
At 1 p.m. PST, the close of regular market trading, MP3.com shares were down $1 to $30. The earnings report was issued after the close of regular trading. In after-hours trading, MP3.com shares were trading around $32.
MP3.com, widely viewed as a market leader in digital music, primarily offers free online audio tracks by independent artists; it had a hot initial public offering in July.
MP3.com chief executive Michael Robertson attributed the earnings to a huge rise in online advertising and to the development of new technology for listening to and downloading music from the Net.
"We believe our cash reserves, our enviable brand equity, as well as our strategic vision and content scalability should well pave the way for continued growth," Robertson said in a statement.
Robertson also touted his company's enhanced version of the My.MP3.com, which includes Beam-it and Instant Listening programs. With the new programs, Net users can get digital copies of CDs they already own or of music they've purchased from the company's CD retail partners.
Despite its success, however, the new programs have come under fire.
Last week the Recording Industry Association of America sued MP3.com, alleging copyright violations. The association accused the company of creating an unauthorized digital music catalog of up to 45,000 CDs, claiming that many of the works are the copyrighted property of its members.
The complaint could result in MP3.com having to pay tens of billions of dollars in damages.
