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Feds querying labels over 'Total Music'

By ALEX VEIGA, AP Business Writer Fri Feb 8, 5:03 AM ET

LOS ANGELES - The U.S. Justice Department has launched an inquiry into "Total Music," an approach for selling digital music that has been the subject of early discussions between major record labels and consumer electronics manufacturers, a person familiar with the inquiry said Thursday. ADVERTISEMENT

The department sent a letter seeking more information from Vivendi's Universal Music Group, said the person, who was not authorized to discuss the matter publicly and spoke on condition of anonymity.

The Wall Street Journal, citing unnamed sources, reported Thursday on its Web site that Sony BMG Music Entertainment had received a similar letter.

A Universal spokeswoman declined to comment. An e-mail sent to a Sony BMG spokesman and a call placed after hours to the Justice Department were not immediately returned.

Universal Music has been floating the idea of selling digital music built into all sorts of electronic devices — from digital music players to personal computers — since last year.

The plan hasn't materialized into anything concrete, but discussions between Universal and rival record companies may have raised the potential for antitrust issues at the Justice Department.

The idea behind Total Music involves offering music fans access to unlimited digital music for a period of time with the cost built into the price of the portable music player, mobile phone or other device.

Mobile handset maker Nokia Corp. and Universal struck a deal last year that calls for Nokia to offer a similar service sometime this year.

Past deals between major recording companies have drawn scrutiny from the Justice Department. In 2001, it investigated two online music services, pressplay and MusicNet, which were joint ventures between major record labels.

Two years later, the department concluded there was no evidence the ventures stifled competition.