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Technology Stocks : RealNetworks (NASDAQ:RNWK) -- Ignore unavailable to you. Want to Upgrade?

To: Pruguy who wrote (1654)	2/2/1999 12:04:00 AM
From: chris brindle	Respond to of 5843

Review of SMIL technology in the 2/9/99 issue of PC Magazine Check out all the info at this site,...review with links on the left side... zdnet.com Chris

To: Pruguy who wrote (1654)	2/2/1999 12:37:00 AM
From: B. A. Marlow	Read Replies (2) \| Respond to of 5843

MP3 not so much "competitive" per se, Pruguy. More the future... It really comes down to RNWK's agenda and what it wants to be when it "grows up." What you need to know is that the MP3 audio format is far higher in quality than RNWK's format, which was designed for low-bandwidth streaming. RNWK's quality is only somewhere between AM and FM, and certainly not on a par with CDs (hype to the contrary notwithstanding). Big political issues surround MP3 because it is not "secure," but it has immense populist support. The MP3 format was not originally meant for streaming but it can work that way. On the other side of the aisle is the Jack Valenti School of Copyright Management, which includes the RIAA and major record companies. These guys are scared to death of MP3 because it threatens the establishment's ability to protect its product from duplication. Thus, we have a Holy War. WinAMP is the leading MP3 player, with millions of shareware downloads. The tiny firm that owns it can be had, but as you see, the issue is controversial. Currently, most of the MP3-format material on the Web is pirated music, converted from CD to MP3 by individuals and uploaded to hobbyist aggregation sites where it is freely shared. The "copyright police" try to shut them down, but they come right back, like weeds. Many are offshore. That's why LCOS reports that its second most common search word is "MP3." I'm sure it's true at virtually all of the portals. MP3.com is the leading "legitimate" MP3 product purveyor, and just received $10mm or so of Sequoia VC funding. This tells you that MP3 ain't goin' away! But don't look for Springsteen at MP3.com and other "legal" MP3 distributors. You'll find only new bands, off-beat stuff and direct-to-consumer sales that recognize files will be traded around; but MP3.com's traffic establishes the commercial value of, and demand for, the MP3 format. At least 3 alternative high quality audio formats exist that promote "security," MP3's limitation: These include Liquid Audio, a2b Music (AT&T), and apparently, an entry from IBM. While these alternative, secure formats would make copyright holders happy, propeller heads say there are technical flaws in all of them that compromise their quality. They are doubtless correct. If the record companies endorse one or more of these "politically correct" formats and it turns out "low-fi," they risk alienation and a huge increase in piracy. They are sweating bullets as we speak. MSFT provided limited MP3 support in its Media Player. It's not the best support, but it's a start. MSFT's attitude about MP3 was, in effect, "hey, we can't stop it; we might as well just give people what they want." Thus, MSFT's inclusion of MP3 is a tacit endorsement: it knows the format will prevail. For its part, RNWK declined to include MP3 in the free player this time around. So the question is, whither RNWK? For RNWK, the issue isn't technical, it's political. Many feel that it should just take over WinAMP and work to satisfy the copyright community. Even though MP3 is an open specification, RNWK can customize server implementations, integrate e-commerce functions, play around with security and sell its suite to the whole market. If RNWK fails to grab the bull by the horns, however, it will end up losing mindshare and market share. RNWK's player will no longer be the "does 'em all" product. A bunch of "player selectors" will appear that integrate WinAMP, RealPlayer and Media Player into a master controller applet on the desktop. RNWK must not let this happen. To retain leadership, it has to stay in charge of all formats and dominate the desktop. There's a prodigious amount of information on MP3. Start with this report, then check out sites like Wired, CNET and the other usual suspects. redherring.com Comments, anyone? BAM