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“We hope our experiment with EMusic will help us generate new interest in these titles, while offering a great opportunity for us to give consumers some flexibility.”

UMG GOES MP3 WITH EMUSIC DEAL

Music Group Takes Back-Catalog Stab at Giving the People What They Want
Let’s see if we’ve got this straight. Universal Music Group is making some 1,000 albums available as unprotected MP3 files via EMusic? Burnable, exportable, even sharable?

Yup. In a deal announced on Tuesday (7/9) with the Vivendi Universal online property, UMG will offer back-catalog material as part of what Universal eLabs head Larry Kenswil calls an “experiment.” Among the UMG-furnished offerings are full-lengths from artists as diverse as Eric Clapton, Benny Goodman, Kool and the Gang and Rocket From the Crypt.

“We hope our experiment with EMusic will help us generate new interest in these titles,” Kenswil points out, “while offering a great opportunity for us to give consumers some flexibility. There is clearly huge demand for music delivered digitally, and we want to support as many innovative online music services as possible. In order to continue to assess the market, we hope to enter into similar agreements for this segment of our catalog with other subscription services.”

Subscribers who pony up $9.99 per month (with a 12-month commitment; a three-month plan is slightly more) have unlimited access to the material in unprotected MP3 form. It’s the biggest move to the popular, unrestricted format by a major label group so far. EMusic is offering free trials as well.

“Vivendi Universal is committed to being a worldwide pioneer in distributing all types of content to consumers over the Internet and other next-generation platforms,” proclaimed VU Net USA chief Robin Richards. “This digital-delivery agreement between UMG and EMusic is a milestone for the industry and clear example of that leadership.”

Kenswil notes that, as free peer-to-peer services have widened their reach, more specialized music has been pushed aside. “The more popular something becomes, the more mainstream it becomes,” he notes. “If you have millions of people ‘sharing their favorite files’—though I wouldn’t put it that way—you’re going to have what’s selling.”

With enough effort, you might be able to find the specialized tracks for free, he avers. “But then again, you could probably shoplift them, too.”

In any case, he adds, UMG is trying different models to see what works in what Kenswil characterizes as a “fluid and surprising” period of transition for online music. While he compares EMusic’s untethered, all-you-can-download model to a music club, he believes that, ultimately, “secure” files represent the future. “Otherwise you’re stuck with one price point,” he insists. “DRM [digital rights management] is becoming increasingly invisible and less restrictive—consumers will soon be able to do everything with rights-managed music except redistribute it.”

Digital-music observers have long searched for a distribution model that parallels the multiple venues and income streams generated by a major film as it moves from limited theatrical release to pay-per-view, cable, DVD and ultimately broadcast TV. Offerings like those in the UMG-EMusic deal could represent a later stop in that value chain, after a track has enjoyed its initial run in protected form.

EMusic says its service now boasts more than 50,000 subscribers and some 225,000 tracks from 900-plus labels.

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