I like this article and wanted to pass it onto you. IMO it is a nice recap of the struggle that has been going on in the music industry and how it's shaping up. Also nice plug for LUcents ePac (which is of course edig embedded)
<<<Broadband Week for January 31, 2000
Cacophony Sounds in Music Overhaul
By Gary Arlen
Contributing Curmudgeon January 31, 2000
In the short term, Time Warner's $20 billion merger with EMI Music will
overshadow the $140 billion (or whatever today's valuation is)
integration of Time Warner Inc. into America Online Inc.
It's also a reminder that AOL -- which clearly knew about the EMI
negotiations -- and its CEO in waiting, Bob Pittman, are ready to
guzzle from the cornucopia of digitally distributed music.
The music industry is wrestling with Internet issues that are far more
crucial to its very survival than the similar battles being fought
among high-speed carriers and long-range content strategists.
It was no coincidence that on the day of the Time Warner-EMI alliance,
Microsoft sprayed an array of digital and Internet entertainment deals
and investments. Some of those ventures will quickly lead to clashes
between Microsoft and its key rival, AOL.
The ways in which Internet music-on-demand issues evolve during the
next few years could set the path for the subsequent richer and more
complex skirmishes about Internet video.
"Disposable music" is at the heart of today's music-industry
rearrangement. For many of us, collecting records was a matter of
pride: lining up those album covers and stacking crates full of vinyl
was a sign of accomplishment and good taste. Admit it: you probably
still have a stash of favorite music in the basement -- things you
never got around to transferring to tape or CD-ROM, but still plan to
get around to.
Today's young listeners, as confirmed by several polls, merely want to
hear the music. They toss out the CD jewel boxes and only sporadically
keep the notes/inserts. They sell or trade the CDs as soon as they tire
of the music. They find time to dub their few favorite songs onto hard
drives. RealAudio has made that very easy.
MP3 and other music-download techniques cut out the middleman
altogether and elevate a new breed of alternative musicians. Listeners
scavenge for the songs they want, then delete music when they move on
to the next sounds. Big labels may still control the big artists, but
underground (online) distribution has given new life to garage bands --
as has insurgent promotion via chat rooms and other Web tools.
Meanwhile, the nature of Web commerce itself has worked against
traditional music labels.
A CD that costs $15 in Los Angeles or Cleveland may sell for $30 in
France or New Zealand. Thanks to CDNow, Amazon.com and other e-tailers,
a customer anywhere in the world can buy music at the U.S. price, pay
the shipping and still get a bargain -- much to the dismay of the music
labels' existing worldwide brick-and-mortar distributors.
But selling and shipping plastic discs is not what the Time Warner-EMI
deal is all about. It's about fear: the fear of what will happen as
fickle listeners turn increasingly to the Internet for the music they
want now.
AOL had the foresight to buy spinner.com -- a major online source of
downloaded music -- last year. That asset gives AOL-Time Warner another
avenue to exploit the Warner-EMI music library.
Meanwhile, there are no assurances that giants like Warner-EMI (which
combined controls about 25 percent of the global music market),
Universal or BMG have a lock on the music of the future.
Companies such as Liquid Audio, which provides software for digital
delivery of music via the Internet, continue to grow in importance.
Microsoft allied last week with Liquid Audio, which will use Windows
Media technology to host and distribute music to hundreds of online
retailers in its network and serve as a clearinghouse for Windows Media
digital-rights management. That adds strength to the online music
community (and it jazzed Liquid Audio stock by 32 percent in one day).
Separately, Microsoft last week pumped $56 million into Intertainer
Inc., a company with strong cable connections, but with plans for
digital-music packaging and digital-subscriber-line distribution.
Remember: On-demand technology works just fine for audio, and
Intertainer (headed by music-industry stalwarts) can make an easy move
in that direction -- if it can get content.
Microsoft's money can help them to find that content. The funding
bought Microsoft a 20 percent stake in Intertainer and a reminder that
the Redmond giant plans to work its way deep into the infrastructure of
online music distribution.
A deluge of digital and Internet music tools surfaced at last week's
MIDEM music trade show in Cannes, France.
Lucent Technologies licensed its enhanced "Perceptional Audio Coder
(ePAC)" to several online music-security systems, recognizing the need
to offer pirate-proof distribution if music is to be sold online.
Lucent touts that its technology makes safe the "virtual record store"
-- a quaint and perhaps final reference to the vinyl discs that are
long-forgotten.
Copyright-protection tools are crucial to Web music. The free access to
and manipulation of Internet music will continue to drive
rights-holders crazy, which is why Warner-EMI, Microsoft and AOL are
scrambling to stake a place in the business and claim glory for
rescuing the music industry from Internet enslavement -- or
emancipation.
I-Way Patrol columnist Gary Arlen keeps a stack o' wax handy for those
after-work sock hops. >>>
PS; Richard, you missed the pleasure of our company:-)
JD |
