Europe investigates net music sales

The European Commission is to investigate online music ventures MusicNet and Duet, the two internet services run by the five major record labels.

The Commission said it has already been lobbied by the Independent Music Companies Association but has not yet received any official complaints about either service. MusicNet is backed by Warner, Bertelsmann, EMI and streaming media firm RealNetworks, while Duet is funded by Sony and Universal.

However, there are concerns that smaller labels could lose out on online sales due to the market power shared by the companies backing MusicNet and Duet.

Mario Monti, competition commissioner at the European Union, said: "These are important cases for the development of music services offered online to consumers and there are potentially a number of issues which merit closer examination. The consumer interest is clear: yes, online music services should develop rapidly, but with a diversity of service providers."

Officials at the Competition Commission are currently looking at a number of internet ventures in varying markets to check that large companies are not setting up monopolies through the back door. It is also looking into DVD price-fixing, as reported here.

Meanwhile, Cisco has said that it will sell RealNetworks' internet broadcasting software alongside its own products. It will offer the RealSystem iQ streaming audio and video products to corporate clients.