t was hailed as ingenious: a way to listen to music on demand while avoiding the legal battleground of file sharing. Best of all, the music was fully licensed, so there would be no legal trouble.
But it was not, and there is. On Friday, the Massachusetts Institute of Technology announced that it would temporarily shut down its groundbreaking Library Access to Music System until the licensing rights can be worked out.
The music service had its official start one week ago but within hours, music companies, including the Universal Music Group, complained that they had not granted - or been paid for - the required legal permission to make the copies of their songs used by the system.
The creators of the new service, M.I.T. students Keith Winstein and Josh Mandel, were dumbfounded by the industry move, since they had paid Loudeye, a company in Seattle, to fill a hard drive with licensed songs. Mr. Winstein and Mr. Mandel said that they thought the contract with the company guaranteed that the copyright issues had been resolved.
"So far as I know, we bought this music fair and square," Mr. Winstein said.
He called the decision to suspend the service crushing, but he hoped it would only be temporary.
"The prudent thing to do, the good faith thing to do, is to take it down while we feel out where we stand," he said.
The music library idea is a clever blend of technology and law. Its creators built the system within the school's cable TV network; the analog TV network would, the students thought, help sidestep the expensive and restrictive laws and regulations that have grown up around the copying and sharing digital copies of music.
It was supposed to resemble the analog world of radio, in which stations pay performance fees to artists representatives like the American Society of Composers, Authors and Publishers but do not pay royalties to the music labels. Because students could listen to the music without making or trading copies, the system's creator thought that they only had to make sure they had legally purchased the music and would not require further payments to the labels.
But the situation has swiftly devolved into a festival of finger pointing. Universal Music Group, a division of Vivendi Universal, issued a statement on Friday saying, "it is unfortunate that M.I.T. launched a service in an attempt to avoid paying recording artists, union musicians, and record labels." Loudeye, the company said, "recognized that they had no right to deliver Universal's music to the M.I.T. service, and M.I.T. acted responsibly by removing the music."
M.I.T., however, issued a statement on Friday that stressed that the system "was designed to operate in full compliance with the law and to respect the rights of all copyright holders," and said that Loudeye had not made good on its promises.
"We have been working with Loudeye on obtaining content since October 2002 and Loudeye assured us on multiple occasions that the content they provided to us was prepared fully under authorization from the record labels and on behalf of the publishers."
For its part, Loudeye seems to be claiming that M.I.T. had misunderstood its contract. The company did not return calls seeking comment, but a spokesman told The Los Angeles Times, which first reported the conflict, "We provided content to M.I.T.," but "we did not provide licenses for them to issue that content."
That would appear to contradict what the company had said in a news release the day that the program started, which referred to "approximately 48,000 licensed digital music tracks.'' In the same Loudeye news release, the company quoted Mr. Winstein as saying, "As far as we know, Loudeye is the only company in the country with all the rights and permissions in place to provide this service." That news release has since been removed from Loudeye's Web site.
Getting the legal issues worked out was more complex than the technical ones, Mr. Winstein said. In a paper about the system that he wrote last May, he said that the M.I.T. project raised issues that the industry licensing organizations had never considered, even though they might apply to radio as well. "We were not willing to purchase recordings from Loudeye until we could receive permission from the songwriters and music publishers," he wrote. They approached the Harry Fox agency, which licenses music for the National Music Publishers Association, about clearing the rights. "Five months after first receiving our request for a license to buy these CD's (on a hard disc) from Loudeye, the Harry Fox Agency concluded that no license was necessary. Four hours later, Harry Fox's New Media Coordinator "called me back to say they had changed their mind and decided Loudeye did need a license from them." (The company did not respond to calls seeking comment.)
To Jonathan Zittrain, who teaches Internet law at Harvard and is a director of the university's Berkman Center for Internet and Society, that incident shows that the world of copyright has grown so arcane that even the major players do not even understand it. "It doesn't seem that M.I.T. was trying to steal anything, but rather to simply hew to the letter of the law in an incredibly byzantine area," he said. "Good faith and technical genius alone doesn't make it work."
Now a whiff of conciliation albeit still a bit barbed, is in the air, according to the Vivendi statement: "M.I.T. has now contacted us and apparently recognizes its responsibility to compensate creators for the use of their works. Universal looks forward to discussing how to make that possible."
