CONSUMERS NOT DOWN
WITH DOWNLOADING

Consumers have not accepted the online purchasing and downloading of music and are not likely to change with the new services being created by record labels, according to a survey by research firm GartnerG2.

The survey of 4,000 adults on the Internet found that nearly 50% listen to CDs on their computers, but only 25% listen to music downloads from the Internet on their computers.

Only 6% of those surveyed purchased digital music downloads in the last three months.

The report contrasts other research reports anticipating a surge in online music sales in coming years.

"The percentage of Internet music buyers is not likely to increase with new Internet services being developed by the big five music companies unless they make their copyright protection systems more flexible to entice consumers," said GartnerG2 analyst P.J. McNealy.

The report said that in order for the digital music revolution to become viable, the five labels must agree to a standard platform for digital music distribution. Currently, AOL Time Warner, BMG, EMI and RealNetworks are developing their joint music service, MusicNet, while Sony and Vivendi prepare for the late September launch of their online music service, Pressplay (hitsdailydouble.com, 8/27).

As each label searches for "the right" digital rights management (DRM) solution, they are alienating consumers and stalling the economics of the proposition at the same time, according to the GartnerG2 report. We’re not sure what that means, but it sounds complicated.

"Digital distribution needs to be brain-dead simple for consumers, and any DRM solution deployed should work with all music software and hardware. In order for this to happen, the Big Five need to work together, and that doesn't look hopeful before 2002," McNealy said.

Meanwhile, Napster would like to remind you that its new subscription service will launch by the end of the year.