January 23, 2007
Record Labels Contemplate Unrestricted Digital Music
As even digital music revenue growth falters because of rampant file-sharing by consumers, the major record labels are moving closer to releasing music on the Internet with no copying restrictions — a step they once vowed never to take. The New York Times reports.
"... At least one of the four major record companies could move toward the sale of unrestricted digital files in the MP3 format within months.
Most independent record labels already sell tracks digitally compressed in the MP3 format, which can be downloaded, e-mailed or copied to computers, cellphones, portable music players and compact discs without limit.
The independents see providing songs in MP3 partly as a way of generating publicity that could lead to future sales.
For the major recording companies, however, selling in the MP3 format would be a capitulation to the power of the Internet, which has destroyed their control over the worldwide distribution of music.
Until last year, the industry was counting on online purchases of music, led by Apple’s iTunes music store, to make up the difference.
But digital sales in 2006, while 80 percent ahead of the year before, grew slower than in 2005 and did not compensate for the decline in physical sales, according to an industry report released in London last week."
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