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On June 15, electronic music distribution received a big boost from the U.S. Court of Appeals for the Ninth Circuit. Judge Diarmuid F. O’Scannlain, writing for a unanimous three-judge panel in RIAA v. Diamond Multimedia Systems Inc., ruled that Diamond Multimedia’s Rio did not violate the Audio Home Recording Act of 1992 (AHRA) because it was not a “digital audio recording device” as defined by the act. [FOOTNOTE 1]

The RIAA decision is the latest step toward breaking up the music distribution monopoly held by large recording companies. Electronic music distribution and its main vehicle, the Moving Picture Experts Group-1 Layer 3 Audio (MP3) format, are revolutionizing the way artists relate to record companies and the way both relate to consumers. Artists’ bargaining power is strengthened as a result of having the means to distribute their own music. Record companies fear the loss of record sales, while consumers reap the benefits of obtaining CD-quality music–in some instances, free or at a fraction of the cost of buying a complete album.

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