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Business Briefs

Internet piracy erodes music industry sales, Germany plans major infrastructure investment, EU takes control of open skies negotiations and more.

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Is the Internet cutting into Britney and Christina's pocketbooks?

Is the Internet Killing German Record Labels?

Illegal MP3s downloaded off the Internet are eroding profits in the German music industry. The country's music industry association (IFPI) on Thursday reported an 11.3 percent drop in revenues derived from sales of CDs, cassettes and records in Germany during 2002. Germans spent €1.97 billion ($2.13 billion) on groups ranging from Nena to Christina Aguilera, but sales were still down substantially. Association chairman Gerd Gebhardt blamed piracy for the drop in sales. "Compared to other country's, there are a lot more CD burners in Germany," he said.

German Government Plans Major Infrastructure Investment

The German government is reportedly planning an economic stimulus package worth billions of euros. According to the German newspaper Die Welt, the government plans to invest up to €6 billion ($6.5 billion) on infrastructure projects primarily in the construction sector. Die Welt reported that the money will go mainly to projects in areas of high unemployment. The newspaper said details were currently being finalized between the chancellery and the transport, finance and economics ministries.

German Railways To Strike Saturday

Following a breakdown in wage negotiations, unions representing Germany's national railway, Deutsche Bahn, said on Thursday they would stage warning strikes across the country on Saturday. Service outages are expected in different German states on Saturday and each subsequent day for the following week. The Transnet and GDBA labor unions are demanding a 5 percent increase in pay for Deutsche Bahn's 160,000 workers. Bahn CEO Hartmut Mehdorn said that, although he could not stop workers from striking, he "could not understand why anyone would want to weaken the railway during a time when it is facing questions about its future existence."

EU Decision Expected on Volkswagen Law

The European Union's commissioner for internal markets, Frits Bolkestein, is expected to make a decision over whether or not to proceed with a lawsuit against Germany over its controversial Volkswagen law on Wednesday. The law effectively gives the state of Lower Saxony, which is a minority shareholder in the Wolfsburg-based car manufacturer, controlling votes in all important decisions facing the company -- including mergers. The law also serves as a de facto poison pill to protect the company from a foreign takeover. The incoming premier of Lower Saxony, Christian Wulff of the Christian Democratic Party, told journalists Bolkestein had telephoned him to warn that a decision was imminent. Observers believe the EU will contest the law, which Bolkestein has lambasted as anti-competitive, in the European Court of Justice in Luxembourg.

EU Wrests Control of Air Treaties from Members

The European Commission on Wednesday said it would seek to wrest control of negotiating international aviation treaties from its member countries. The move follows a November 2002 ruling at the European Court of Justice, which found that eight European countries had violated EU law by signing airline pacts with the United States that discriminated against airlines in neighboring European countries. The court found that the deals favored national flag-carrier airlines to the detriment of competitors. The commission has said it wants to end protections for national flag carriers and promote more mergers in the aviation industry. "With these measures, we will be able to ensure that the EU can finally pull together in this field and work to develop international air transport to the benefit of the industry and consumers," EU Transport Commissioner Loyola de Palacio told reporters.