Universal Music has launched a legal challenge against MySpace, the first time  Rupert Murdoch’s social network site has been challenged for copyright infringement.

Universal is suing MySpace for unauthorised use of the music and music videos of its artists, citing the availability on the site of material from Jay-Z’s as yet unreleased album as an example of this.

Universal, owned by French media group Vivendi, has been the most aggressive of the record companies in defending the copyright of its artists. It has previously launched action against Grouper.com and Bolt.com for the same reason.

YouTube avoided similar action by cutting a deal with Universal in which YouTube pays licensing fees and shares ad revenues for use of its artists’ work. Talks on a content deal between MySpace and Universal had apparently broken down.

Universal is believed to be testing a US federal law that provides a ‘safe harbour’ to internet companies which remove copyright content after being alerted by the copyright holder.

This ‘safe harbour’ has allowed video sharing and other social network sites to achieve rapid growth while so far avoiding confrontation with the copyright owners.

Were Universal to win in court, it would set a precedent which would allow it leverage in any revenue sharing deals it makes with user-generated sites. 
Universal’s lawsuit states that the user-generated content on MySpace is actually ‘user-stolen intellectual property of others’ and that MySpace is a ‘willing partner’ in this theft.

On his blog, Mark Cuban suggests much of the appeal in user generated sites is the easy acess to copyrighted material – after all, why else would YouTube spend millions to keep copyrighted content available for its users?