MP3.com Faces the Music

It was early 1998 when MP3.com Inc. (MPPP ) founder and CEO Michael L. Robertson first realized just how much the music industry had it in for him. At a conference in Los Angeles sponsored by the National Academy of Recording Arts & Sciences, Robertson stood up from the audience and announced that he had placed software in everyone's giveaway bags. The software could turn songs into MP3 files that could be sent over the Internet. He hadn't thought much about how this might be a mortal threat to the recording industry. But the crowd of grey-haired music executives clued him in. They started booing and screaming obscenities. Then "they yelled, `Sit down!"' Robertson recalls.

He sat, but he didn't back off. Ever since Robertson founded San Diego-based MP3.com in 1998, he has relentlessly pursued his vision of turning the Web into a place where people can hear their favorite music anytime, anywhere. While the site is famous for featuring the work of unknowns, his most important offering now is My.MP3.com, which allows users to store music in virtual lockers on his site, dream up their own playlists, and tap in instantly from any Web-connected device. Supported mostly by advertising revenues, MP3.com in February served up 59 million tunes to nearly 1 million consumers. Its revenues for fiscal 2000 were $80.1 million, a 266% increase over 1999--though it reported a loss of $23 million.