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Tuesday, November 07, 2006

Digital Music Revolution

Digg! Slashdot Slashdot It! Internet downloads, both legal and illegal, combined with the unprecedented invasion of MP3 players, are changing the way we acquire music and how we listen to it. More than 60 million music MP3 players were sold in 2005. Microsoft's new Zune player is now to take on Apple's iPod; 450 million songs were legally downloaded last year.

Jukeboxes

Digital players like Apple's iPod, Creative's Nomad and Archos' 504 are monster jukeboxes that can play not only compressed MP3 but also full quality, high resolution audio to satisfy the most discerning ears, even if the latter means reducing their storage capacity a bit in terms of number of songs or hours of music.

All this is slowly killing the conventional CD and record companies are looking for new ways to compensate for the loss in revenue. Selling music online seems the only viable alternative for now. Vivendi-BMG has just announced that it will make available a large catalog of music for only US$7 per album downloaded, instead of the usual $10 that other companies, including iTunes, demand.

Saving costs

Delivering an album online to a customer as a digital download saves the record company the cost of manufacturing, packaging and distributing the physical CD. This should certainly prove to be more profitable in the long run.

Software vendors have long encouraged buying software online and downloading it without ordering the actual CD. Typically, they price downloads less than the physical object one would otherwise have to order.

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