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Weekly AUDIO NEWS for April 11, 2001colored line

Big Record Labels Spurred to Web Music Deals by Napster - While Napster is in Big Trouble, the controversies over the free music sharing site have prompted all five of the largest record industry giants to make deals with bigtime Net partners. Six different deals involving online music were signed last week. RealNetworks, known for its streaming audio and video software, linked up with AOL Time Warner, BMG and the EMI Group. Their online venture, which will allow users downloading or streaming music from songs owned by the three record companies, is to be called MusicNet.

The two biggest labels of all - Sony Music Entertainment and Universal Music Group - joined with web portal Yahoo Inc. Their online service is to be known as Duet. Then all five of these labels set up another partnership that involves Viacom-owned MTV's cable arm and Rioport - the firm making the popular portable Rio MP3 player. MTVi has two sites already in operation: Radio MTV.com and VH1atWork Radio. They are beginning with a selection of about 10,000 songs from all five major labels, licensed for downloaded at about 99 cents per single track to $17 for an entire CD's worth. Analysts feel the MTV operation should do better than the others since their brand name is already recognized. But some also indicated that it may be a year or longer before there is a workable and legal alternate to Napster.

Napster On Its Last Legs? - Napster's efforts to make a deal with the five major labels may now be beside the point due to the above news. Napster believes can generate millions of dollars by switching its members to monthly subscriptions ranging from $2.95 to $9.95. Yet the upstart service concedes that charging for its formerly free offerings would lose it up to 98% of its users. The question is would users pay $10 for less that they used to get for free? Also the big labels and artists themselves would want to control Napster closely and install all sorts of anti-copying software. Finally, the way Napster is set up - as a peer-to-peer network of users - it not possible for the company to really police their content no matter how much they would spend on staff and software. One expert says to expect the site to be boarded up sometime in 2001.

Current Competitors to MP3 - New and improved audio codecs have been developed which can either equal the sound quality of MP3 with much smaller file sizes and/or surpass its audio quality with similar-sized files. So don't expect MP3 to be around much longer either. These formats include Advanced Audio Coding (AAC), which is licensed by Dolby and is a part of several proprietary secure formats including the new MP4. It is not only more efficient than MP3 but also can provide many more channels of audio and a much wider range of sampling rates including some really high fidelity ones. Other formats are ATRAC3, AT&T's a2bmusic, Lucent's EPAC, RealAudio, Liquid Audio, TwinVQ, and Windows Media Audio AAC.

- John Sunier

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