DIMD taking off on bad news...LOL heres the news
Monday February 8 1:07 PM ET
IBM Unveils Internet Music Delivery System
NEW YORK (Reuters) - International Business Machines Corp. (NYSE:IBM - news), in an alliance with five large music companies, Monday unveiled a system to allow home computer users to download music and make secure royalty payments to record companies via the World Wide Web.
The music companies in the deal -- Seagram Co. Ltd.'s Universal Music, EMI Group Plc's EMI, Bertelsmann AG's BMG, Sony Corp. (NYSE:SNE - news)'s Sony Music Entertainment, and Time Warner Inc. (NYSE:TWX - news)'s Warner Music -- will make a large selection of music available when the pilot product is unveiled later this year, an IBM spokeswoman said.
Initially the trial will be limited to users with broadband cable modem delivery. Users will be able to download a complete CD-quality album to a computer hard drive, then transfer the music to their own compact discs, the IBM spokeswoman said.
Over 2,000 albums will be available for download during the trial, which will start in the spring and last for more than six months involving 1,000 cable subscribers in San Diego.
''Not only will this system allow consumers to purchase popular and current recordings, but it will also open the door to catalog and hard-to-find recordings rarely available through existing retail outlets,'' Larry Kenswil, head of e-commerce at Universal Music Group, said in a statement.
The system is an attempt to combat popular products that copy music over the Internet, but often bypass making royalty payments.
''Consumers, artists, technology companies, consumer electronics companies and music companies will all benefit if approaches to digitally delivered music are both interoperable and secure,'' said Kevin Conroy, senior vice president of marketing at BMG Entertainment.
The system, formerly code-named ''Madison,'' is the recording industry's first non-litigious response to its competitors, primarily Diamond Multimedia Systems Inc. (Nasdaq:DIMD - news)
In October, the Recording Industry Association of America sued Diamond alleging its product, called the Rio PMP300, violates the 1992 Audio Home Recording Act because it allows music to be replayed without paying artist royalties.
IBM shares were off 75 cents a share at $165 a share on New York Stock Exchange trading at midday.
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