MP4 is not to be confused with MPEG-4, a next-generation audio and video compression format that has been adopted by the International Standards Organization and endorsed by a number of computer hardware, peripheral, and consumer electronics manufacturers. MPEG-4 is an open standard for media delivery, while MP4 is GMO's proprietary technology.
Many in the record industry, which is led by the Recording Industry Association of America, a powerful lobbying group, are fearful of the MP3 format because its popularity and ease of use has made possible the posting of any number of songs online without any return to the copyright holders. The RIAA last month launched the Secure Digital Music Initiative (SDMI), which aims to create a specification to ensure copyright protection that ostensibly could be embedded in any music-delivery technology.
MP3 got a boost today, however, with the announcement that high-profile venture capital firm Sequoia is investing $11 million in music download, news, and community site MP3.com, which many consider the hub for the thriving MP3 community.
Alongside the unveiling of MP4, rap group Public Enemy has released its latest single, "Swindler's Lust," using the MP4 format. Public Enemy front-man Chuck D has been outspoken about the benefits of using the Web--instead of record stores--to distribute popular music.
MP3, which many consider a de facto standard given its widespread use, and now MP4 compete with secure download formats such as a2b, the product of AT&T Labs' music delivery technology arm a2b Music, and technology from Liquid Audio. GMO used encoding technologies licensed from AT&T Labs for copyright protection in its MP4 format.
"With our MP4, we hope to bridge the widening gap between the needs of online music fans and the rights of the artists and record companies that produce the music," GMO chief executive Anthony Stonefield said in a statement.
Despite the play on the MP3 name, MP4 technology is different. For one thing, MP4 is an executable file, meaning that an embedded audio player is launched when the MP4 file is opened. In contrast, MP3 files use software called WinAMP to play, and MP3 audio files can be combined with other MP3 files to create a customized play list.
The fact that MP4 is intrinsically different from MP3 may be a turn-off to Web music enthusiasts, who prefer to use more open technology standards to create their own play lists, according to Forrester Research senior analyst Mark Hardie.
"What GMO is creating is essentially a proprietary music package that you can't pick apart," said Hardie. "It's what the record industry would ideally like, but it goes against what consumers are preferring online."
The recording industry and music technology companies have to face up to the fact of MP3's grassroots popularity, he added.
"[MP3] has become popular because the sound quality is sufficient, but also because of the ability that the consumer has to combine music from various artists onto a play list. With WinAMP, you can literally identify the files on your desktop one after another," Hardie said.
GMO plans to release a MP4 "rack" that can be used to download songs onto their hard drives. The songs, however, cannot be "burned" onto a CD, the company said.