Music services take song-swappers' cue

Strangely enough, it looks and feels much like those same file-trading services, which the record industry has spent two years in court trying to eradicate. But that could turn out to be a benefit, especially if they are to woo a generation of digital music aficionados weaned on Napster and its rivals.

The preview version provided by MusicNet--a joint venture between RealNetworks, AOL Time Warner, Bertelsmann and the EMI Group--is only a taste of what consumers will actually see, however. America Online and RealNetworks each are building the technology into their own services deeply enough that the actual interface and set of features could be very different.

It will be up to those companies, and particularly the decisions they make on pricing, to woo consumers from the free underground song-swapping services that remain hugely popular online. And with a host of disadvantages, including lack of access to content and the inability to transfer songs to MP3 players, analysts say MusicNet and rival Pressplay will have steep hurdles ahead.

"These services are all the foundation for the day when you have all five (major music labels' content) in one place," said P.J McNealy, a research analyst for GartnerG2, Gartner's business strategy division. "And that's not anytime soon."

Smooth operation, steep hurdles
The "preview release" of MusicNet was sent to about 500 reporters, analysts and a few consumers Monday, the first time members of the general public have been able to sit down and play at length with one of the labels' planned subscription services.

As a basic music find-and-play service, it runs smoothly. The application, which resembles Napster or the popular FastTrack software used by MusicCity and Kazaa, allows a listener to search for songs by artist, title, album, genre or even the decade that the song was released. Clicking on the song will download it, and pushing the "stream" button will play it from the server where it is hosted.

Illustrating the subscription nature of the service, the preview release came with the rights to 100 downloads and 100 streams, which click toward zero with each download or play. AOL, RealNetworks and other MusicNet licensees will determine what the real numbers are and how much consumers will be expected to pay.

A large array of songs is available from most genres, but far less than what can be found through almost any underground file-swapping service. MusicNet and the big record labels that back it have not yet won all the rights to the songs on their own labels. They are close to a deal with the trade association for music publishers, which will add a huge number of songs to the available catalog, probably before the service launches commercially.

But even then, MusicNet does not have rights to the songs from Sony Music Entertainment, Universal Music Group or most independent labels' catalogs, which collectively represent a huge swath of the total listening universe.

The songs downloaded are high quality and save much more quickly than the average connection through Napster or MusicCity. This is with few people taxing the systems' servers, however, and performance in a commercial environment could vary. Streaming songs were also high quality but were occasionally interrupted if a PC was also being used for other tasks.

Unlike previous download services, including the wholly legal service operated by EMusic.com, the songs will "expire" after 30 days if a listener doesn't keep an active subscription to the MusicNet service. Nor can the songs be transferred to another computer, burned to a CD, or transferred to another device such as an MP3 player.

Analysts say this too will be a hurdle for the services, as MP3 players and CD burners are increasingly commonplace among digital music listeners.

The bare-bones interface is simply a preview, however. RealNetworks plans to add the service into its RealOne player system inside of two months, and AOL has said that it would build MusicNet into its own subscriber service by the end of this year.

"This is the technology platform and gives you an idea of what a subscription service might look like," said Ann Garrett, a MusicNet spokeswoman. "It doesn't have the bells and whistles that you will see in Real and AOL's consumer launch."

AOL has been mum as to what kinds of "bells and whistles" it will include in its launch. RealNetworks is linking the download and streaming services directly into its music jukebox software, so that songs can be added into preexisting playlists, including those that include songs copied from other sources.

Other subscription services are also moving forward. Listen.com announced Monday that it had struck licensing deals with a large number of independent labels, allowing it to move forward with its own streaming music service.

Napster, which has not allowed song swaps since July, is moving slowly forward with its own subscription offer and says it will be out by the end of this year. That service has not yet gone into a public beta test, however.