To: J.N.N. who wrote (12143 ) 4/8/2000 11:59:00 PM From: bob Read Replies (1) | Respond to of 18366
From this weeks Billboard Magazine. Post by murrayhill on RB. Sony Music Entertainment will announce Monday (April 10) that it plans to make its first commercial digital downloads available to U.S. consumers later this month, offering about 50 hit songs from Lauryn Hill, Pearl Jam, Michael Jackson, Mary Chapin Carpenter, and others. BMG Entertainment, meanwhile, has unveiled the back-end infrastructure for its digital-distribution strategy. Sony will sell downloads through the sites of retailers such as Tower Records, as well as via its own e-tailers, thestoreatsony.com and Sony Electronics' musiclub.com. Sony's business model has the company -- not retailers -- setting the price for product. For its initial download launch, Sony will set a $3.49 list price equivalent for songs, but the actual price will be discounted to $2.49 at all participating retail sites. Initially, songs will be formatted for playback on the Microsoft Windows Media Player with Sony's ATRAC3 audio compression plug-in, and can be downloaded to compatible SDMI-compliant portable devices, including Sony Corp.'s own Memory Stick walkman. Reciprocal, which built the Sony Music digital infrastructure, will provide digital rights management (DRM), clearinghouse, and transaction services in the early stages. As Sony rolls out more titles, other codecs (compression formats) and DRM systems will be used. Sony will pay merchants 20% of the total price charged for each download, retail sources say. In anticipation of so-called viral marketing -- or "superdistribution" -- Sony will encourage consumers to pass songs to friends via e-mail; under SDMI guidelines, the friends would then be instructed to go to a site to pay for playback. In such cases, retailers would receive 12% for the first pass-along and two percentage points less for each subsequent pass-along, down to 6%, retail sources say. BMG, meanwhile, promises the release of current and catalog hits by summer. Retail partners have yet to be determined. Under its strategy, BMG will support three DRM formats -- those of IBM, InterTrust Technologies Corp., and Microsoft -- and two clearinghouse platforms, Reciprocal Inc. and Bertelsmann AG's Digital World Services. Liquid Audio will integrate these independent technologies into one system that BMG and participating retailers can use. Decisions have yet to be made surrounding content hosting, codecs, and retail-pricing models. As for the remaining majors, EMI Recorded Music is close to announcing specifics of its digital rollout, sources say, while the Warner Music Group is polling retailers for specifics on its download model. Universal Music's plans remain uncertain, although it has said that it intends to begin a commercial download rollout by midyear.