RealTime IT News

Big Music Companies Plan Trial Sales on Internet

IBM and the five biggest U.S. record companies will soon sell albums directly to consumers via the Internet--on a trial basis.

In part motivated by the rise in pirated recordings available free on the Net, IBM, BMG, EMI, Sony Music, Universal Music and Warner Music said they will experiment with allowing computer users to download albums for an as yet-to-be determined fee.

The trial starts in San Diego, where later this year 1,000 homes wired for broadband in San Diego will be able to download albums with CD-quality sound in two-and-a-half to four minutes. Initially, more than 1,000 albums from various musical genres will be available.

After the test is over, each company will decide whether to proceed with the new distribution method.

In addition to trying to create a new revenue stream, the companies are trying to catch up to the many people who illegally allow Internet users to download albums and singles for no charge.

Larry Kenswil, executive vice president and global head of e-commerce and advanced technology for the Universal Music Group, told Variety that to compete effectively with pirates, the record labels will have to convince consumers that they are getting something of value when they buy via the Internet the legitimate way.

Kenswil said profits from selling music via the Internet will be "proportional to the broadband roll-out." That's because the system developed by IBM and the music labels requires the use of a high-speed cable modem, or a technology that is as fast.