IBM is expected today to unveil what is being billed as a pirate-proof music delivery system that will enable consumers to download recordings at home through high-speed cable lines.
IBM will demonstrate the technology this morning at a news conference in New York and launch a six-month test involving a sample of cable subscribers in San Diego, sources said. The world's five largest music conglomerates have contributed about $1 million each and a collective 200 recordings to help test the technology, which was developed by IBM last year during a series of tests code-named the Madison Project, sources said.
Although some top record executives privately express reservations about the security protections of IBM's new system, music corporations view the test as a first step toward establishing a uniform standard for digital distribution of music recordings on the Internet--a realm currently dominated by online music pirates.
The move by IBM comes as leaders of the $40-billion global record industry are scrambling to address the proliferation of MP3 technology, a compression formula that enables computer users to download pirated CD-quality songs from the Internet. The technology has spawned a new breed of music fans who gather daily in chat rooms and fly-by-night pirate sites on the Web to swap pilfered hits by top-selling artists such as Brandy and Celine Dion. Microsoft recently invented software to play MP3 files, and Lycos Inc. introduced a search engine to access MP3 songs.
The industry's fear of MP3 escalated last week when a dozen new, unreleased songs by rap star Nas were stolen and posted by a bootlegger for free downloading on the Internet. The tracks were among 30 tunes recently recorded for Nas' upcoming "I Am . . . " album, which was initially conceived as a double CD, sources said. Sony Music, the company that releases Nas' music, is trying to track down the bootlegger, sources said.
Representatives from Sony will join IBM today in New York--along with executives from Time Warner, Bertelsmann, EMI Group and Seagram's Universal Music Group--to voice their support for the test of the new delivery concept.
The system, which sources say cost about $25 million and does not utilize MP3 technology, will allow consumers to select a recording from IBM's Web site and download it in minutes to their home computer via high-speed cable modem. Each recording will be encoded with a digital watermark and encrypted with security measures that theoretically prevent pirates from making duplicate copies, sources said.
Consumers in the test market will also be able to download album artwork from the Web site and may be provided with devices at home that enable them to produce CDs of the electronically transmitted music, sources said. IBM will monitor each transaction and report the volume of sales and other data, including demographic statistics and customer response, to the industry, sources said.
The test will be conducted in San Diego with a small sample of computer users who subscribe to Roadrunner, a joint venture between Time Warner and Media One that uses cable wires to connect at high speeds to the Internet, sources said. Neither IBM nor Roadrunner would comment, but sources said fewer than 1,000 of Roadrunner's subscribers are expected to participate in the trial.
If the IBM test is successful, it could accelerate the development of the digital music market for record companies. Two months ago, the record industry launched the Secure Digital Music Initiative, a plan to create a standard security specification to protect copyrighted music distributed on the Internet.
IBM has been touting its Madison Project software to record companies for months as a solution to music piracy on the Web. But several top record executives who have observed a demonstration of the IBM system said privately last week that they have doubts about whether it is secure.
Other firms, including long-distance giant AT&T;, are developing their own systems to deliver copyrighted recordings over the Internet. Sources said Seagram has been working behind the scenes for months to create its own technology with AT&T;, which has been pitching its a2b music distribution system as a pirate-proof alternative to IBM's Madison software.
Times staff writers Sallie Hofmeister and P.J. Huffstutter contributed to this report.
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