Hi! Thanks for the question.
I will provide you with articles that show an overview of different
segments of the online music industry. Small snippets of some articles
will also be provided but I highly recommend that you read them in
their entirety so as to get a better coverage of the topic.
Overview of the Digital Music Industry
Music File Formats:
“The most popular sound file format these days is .MP3 for both Mac
and PCs.
Other file formats include .AIFF (for Mac); .AU for Mac and UNIX; .WAV
for the
PC; and .RA for Real Audio, a proprietary system for delivering and
playing streaming audio on the Web.”
The following are the most popular formats and their descriptions.
MP3 - “The MP3 format is a compression system for music. The MP3
format helps reduce the number of bytes in a song without hurting the
quality of the song's sound. The goal of the MP3 format is to compress
a CD-quality song by a factor of 10 to 14 without losing the CD
quality of the sound. With MP3, a 32 megabyte song on a CD compresses
down to 3 megabytes or so.”
WAV – “A *.WAV file is a digital recording of the sounds made by any
instrument or human voice. It basically cannot be modified. When a PC
plays back a WAV file, it converts numbers in the file into audio
signals for the PC's speakers. A complete tune recorded in .WAV format
is always very large.”
AU – "AU is short for AUdio, a common digital sound file format used
on Unix machines and the standard audio file format for the Java
programming language.”
Real Audio – “A mainstay of internet audio for many years, and a
standard for streaming audio and video. RealAudio has many quality
settings. The RealAudio files are still smaller than 128kb/s MP3
files, but the quality is also less.”
MID – “Standing for Musical Instrument Digital Interface, it is an
even older format , the standard by which many desktop musicians
compose. These files are tiny, and make quick downloads.”
“The quality of the sound is dependent upon the quality of the
synthesizer on a PC's sound card.”
AIFF – “The AIFF format is associated with Apple QuickTime Player on
Mac and Windows computers. Even if you run under Windows, you will
have no problem playing these files so long as you have Apple
QuickTime installed. The encoding is similar to WAV and quality is
true to instrumentation.”
This document also provides a description on the strengths and
weaknesses of each type of format.
“Compare Music File Formats”
http://www.edb.utexas.edu/multimedia/PDFfolder/CompareMusic.pdf
The ones mentioned above are not the only music formats available on
the web. A comprehensive list of digital file music formats is
available on this next link.
File Formats List
http://www.sonicspot.com/guide/fileformatlist.html
-----------------------------------
Distribution Methods:
“Music on the Web generally falls into one of two categories.
‘Streaming’ audio allows visitors to a Web site to hear a sample of an
artist's music in real time, without the wait of first transferring
the entire file to the listener's local hard drive. A "download", on
the other hand, means that the music is copied to the user's hard
drive, allowing the user to subsequently listen to it without being
connected to the Web site.”
Distribution Method Problems:
“Unfortunately, Web sites do not always recognize the piracy concerns
of content owners, sometimes allowing music to be posted for
downloading in formats, such as unsecured MP3, that include no
mechanism for compensating those who created it.”
“Internet and Wireless Transmission”
http://www.riaa.com/issues/audio/newmedia.asp#music
---------------------------------------
Playing the Music:
Once you have downloaded the music you will have a choice to play it
on your PC or use portable players.
Media Players (Play music on your PC)
http://download.com.com/3150-2139-0.html?tag=dir
http://download.com.com/3150-2167-0.html?tag=dir
List of Portable MP3 Players
http://reviews.cnet.com/Music/2001-6490_7-0.html?tag=dir-allmp3
-----------------------
The Market
It seems that right now the problem over the distribution methods is
one of the most nagging issues on the Internet. People now have the
ability to download music for free but recording artists and recording
companies are up in arms since they are not being compensated for such
downloads. The problem started when Napster became popular.
“How It All Began…the History of Napster”
http://holly.colostate.edu/~cass859/allbegan.html
“The advantages of the Internet are obvious, but the digital challenge
persists for the majors, because the Internet also is an ideal
distribution medium to consumers. This new digital reality is
exploited by some consumers who illegally share music via the Internet
and other online music services. File sharing services like Kazaa have
become very popular the last couple of years and the majority of the
shared music on these peer-to-peer services have been made available
without permission from the copyright holders.”
“Part 2 of 9: The complex challenge of the record companies”
http://musicdish.com/mag/index.php3?id=8211
File Sharing services are providing headaches to legitimate music
download players and these articles show how these illegal services
are changing the buying habits of music consumers.
“We have seen that file-sharing applications and sites do impact
e-retailers such as Tower Records. In this case, we have seen that
they are online competitors, drive referral traffic and may use Tower
as a launch pad to search for music that they will later seek out for
free at file-sharing sites.”
“The impact of file-sharing applications on music e-retailers”
http://www.realenduser.com/features/stories/story_zzzg.asp
In a more current report, global music sales continue to drop.
“Last year saw the steepest fall yet, with a 7 percent drop in global
music sales and a 10 percent fall in units sold in the United States,
according to figures for 2002 released Wednesday by the International
Federation of the Phonographic Industry.”
“’Widespread use of illegal sites, made easier with the growth of
broadband access in the major markets, is affecting an industry that
is also having to compete with increased sales of other entertainment
formats such as DVD films and new video game consoles.’”
Some observers however contend that it is not totally the fault of
file sharing sites that music sales are down and in fact some say that
such services help record labels rather than hurt them.
“Competing studies from the record industry and independent analysts
have shown differing results, with many file-swapping aficionados
saying they are less willing to buy music on the one hand, and others
saying they use downloading to make better-informed purchases on the
other hand.”
“Critics of the music industry's attack on Internet services such as
Napster and Kazaa contend that record labels are simply not releasing
enough good music, and consumers see DVDs as a better value than CDs.”
“Music industry: Piracy is choking sales”
http://news.com.com/2100-1027-996205.html?tag=fd_top
Evidence to the argument of “not enough one stop selections” for
legitimate music sites can be seen from this BBC article.
“Jupiter Research's latest study reveals that legitimate internet
music services are struggling to get off the ground despite the fact
that nearly 40% of Europe's digital music fans are willing to pay for
music online.”
“With the music industry refusing to offer up any but a small
percentage of its artists for digital download, millions of music
lovers are using services such as Kazaa to swap tracks and build up
online libraries of free, if illegal, music.”
“Net pirates outsmart record labels”
http://news.bbc.co.uk/2/hi/technology/2826111.stm
In case you want a list of the file sharing software players in the
industry, please consult our next link. This is not to promote illegal
music but only to provide you with the list of players out there to
enrich your digital music industry overview.
File Sharing Sites
http://directory.google.com/Top/Computers/Software/Internet/Clients/File_Sharing/
---------------------------
The next link provides the challenges for legitimate music labels as
their problem with file sharing sites continue.
1. “Because of the Internet, the five majors need to establish new
online business models - business models which are profitable, protect
the copyright of the record companies and are attractive to consumers.
One of the main challenges is to establish a business model which
protects the content from being misused.”
2. “The challenge is also to create a product that consumers find
attractive. To be attractive, a service has to offer access to all the
majors' artists, which is to say the service needs to offer music with
Christina Aguilera (BMG), Madonna (Warner), Robbie Williams (EMI),
Jennifer Lopez (Sony) and Eminem (Universal).”
3. “Another challenge is to find a pricing structure both consumers
and records companies can accept. The five majors can choose between
different price structures: Pay per download, subscription,
multi-dimensional tariff, multi-step discounts.”
4. “The record companies are also going to decide which distribution
method to implement - streaming, downloading, peer-to-peer.”
“Part 3 of 9: New business models needed”
http://musicdish.com/mag/index.php3?id=8212
Our next three links provide a description of the business models of
Pressplay and MusicNet two legitimate businesses in digital music
distribution.
“Part 4 of 9: How and how well do the record companies deal with the
Internet?”
http://musicdish.com/mag/index.php3?id=8213
“Part 5 of 9: Pricing and content structure”
http://musicdish.com/mag/index.php3?id=8214
“Part 6 of 9: Digital Rights Management”
http://musicdish.com/mag/index.php3?id=8215
The following are some legitimate music downloading services.
Pressplay
http://www.pressplay.com/
MusicNet
http://www.musicnet.com/
Apple iTunes Music Store
http://www.apple.com/music/store/
Sony Music
http://www.sonymusic.com/home/index.html
Finally let us look at the recent success of the newest service in
town, the Apple iTunes music store.
----------------------
The Apple iTunes Business Model – A light at the end of the tunnel
might be coming to record labels and artists. The Apple online music
venture business model may have found a possible antidote to file
sharing services and to music piracy. Other top sites and portal are
looking to implement such services as well.
“The new online service allows users with Apple Macintosh computers to
download songs from a library of more than 200,000 songs for $0.99
each. The library features material from all the major record labels,
including BMG Entertainment, EMI, Sony, Universal, and Warner
Brothers.”
“Apple's iTunes received high praise from users for designing an
attractive and easy-to-use interface for iTunes. Users can browse the
library, search for songs by title, artist or album and then preview
free clips before buying. Following their purchases, users can burn
them to an unlimited number of CDs for personal use or download them
to any number of Apple iPod digital music players.”
“iTunes downloads top 2 million”
http://www.infoworld.com/article/03/05/14/HNitunesrocks_1.html?networking
“Microsoft, Yahoo, Amazon.com and an America Online unit are expected
to launch simplified services to compete with Apple's 6-week-old
iTunes, which charges 99 cents to download a song onto a personal
computer. Viacom's MTV, another popular Web destination, is also
exploring a download venture, according to sources.
“Rivals to Apple iTunes set to offer music, too”
http://seattletimes.nwsource.com/html/businesstechnology/134986873_onlinemusic12.html
Search terms used:
“digital music” industry overview
Apple iTunes business model
I hope these links would help you in your research. Before rating this
answer, please ask for a clarification if you have a question or if
you would need further information.
Thanks for visiting us again.
Regards,
Easterangel-ga
Google Answers Researcher |
Clarification of Answer by
easterangel-ga
on
13 Jun 2003 19:37 PDT
I would like to add some important statistics to my answer.
"The latest findings from Ipsos shows that a fourth of all Americans
over the age of 12 have downloaded a music or MP3 file from the Net.
That comes to about 60 million people. The report doesn't
differentiate between active file traders and those who smoked but did
not inhale, it just gives a broad view of those who at least tried it.
The 28% who admit to tune tasting in the September poll show a slight,
but upward rise in those who turn to the Net for music (26% in June,
and 24% in April). Taking account the 2.94% error-factor in their
poll, this shows that file trading among Americans has at least been
stable over the last 6 months."
"In June of this year Ipsos-Reid found that just over one-quarter
(27%) of American Downloaders reported having paid for at least some
of the music they downloaded. By the end of September that number
increased to 31%. That confirms that users are willing to pay for
digital music if the terms and pricing is right, even with the
availability of free P2P services."
"KaZaa right now claims an audience of 140 million worldwide users. If
PressPlay could claim just 1% of that audience they would be a very
successful entity. The Ipsos poll says that right now, even with the
existence of KaZaa, 31% are willing to fork over dollars for tunes.
Unfortunately, the record industry's product is so restrictive and
expensive that they turn away more of this potential audience than
they draw."
"Ipsos-Reid: More Americans Taste Tunes on Net"
http://www.mp3newswire.net/stories/2002/tunetaste.html
"Music accounted for a significant portion of the $3.1 billion that
was spent in the "books, music, and video/DVD" category during the
2002 holiday shopping season, and Jupiter Research (a unit of this
site's corporate parent) found that 49 percent of teenagers and 38
percent of adults had purchased music online during 2002. Despite this
large base of paying customers, an estimated 50.3 million Americans
download music from an online file-sharing service, according to
Ipsos-Reid"
"American males are significantly more likely than their female
counterparts to have engaged in online file-sharing nationwide, as 26
percent of U.S. men over the age of 12 report having done this
activity, compared to only 12 percent of American women."
"The research measured a dramatic surge in the number of Americans who
regularly listened to Internet radio. In January 2000, 5 percent of
those surveyed reportedly listened to Internet radio in the past
month. That figure doubled in January 2001, swelled slightly to 12
percent in January 2002, and grew to 17 percent in January 2003."
"Finding Money In the Music"
http://cyberatlas.internet.com/big_picture/applications/article/0,,1301_2107191,00.html
"The battle between the music industry and online file-swappers may
not be resolved any time soon as an Ipsos-Reid study reveals that 27
percent of current downloaders would begrudgingly pay for the music if
free options such as peer-to-peer and Internet radio are not
available."
"Of the 27 percent that would agree to pay for music, 19 percent
preferred a pay-per-download system and 8 percent prefer a
subscription service."
"Could Pay-for-Play Replace Peer-to-Peer?"
http://cyberatlas.internet.com/markets/retailing/article/0,,6061_1476001,00.html
"Fierce opponents of music downloading may not appreciate the findings
of research conducted by Jupiter Media Metrix indicating that
experienced file sharers are 41 percent more likely than the average
online music fan to have increased their music spending levels."
"Music Fans Rip More, Spend More"
http://cyberatlas.internet.com/big_picture/applications/article/0,,1301_1025351,00.html
Thanks!
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