Instant Listening Service allows users to listen immediately to newly purchased CDs from partner e-tailers Junglejeff.com, Duffelbag.com and Cheap-CDs.com. When a user buys a CD from one of these partners, MP3.com will receive a notice of purchase. Once that is received, the buyer can go to My.MP3.com, enter a password, and listen to a stream of the CD on the site.
Beam-it allows users to listen to their existing CDs on MP3.com. The CD becomes a "key" for accessing the album on the site. In other words, a user puts a CD from a personal collection into a CD-ROM drive, and if the album is one of about 40,000 in MP3.com's database, the user can listen to it online.
According to MP3.com chief executive Michael Robertson, the implications of this technology could change the way music is purchased on the Net.
"When any new technology comes along, it's important to look at all the ramifications of the business," Robertson said. "There's enormous benefit to the music industry."
Robertson added that music consumers will be able to listen to their online CD purchases more immediately instead of waiting for days until they arrive in the mail. He added that the My.MP3.com upgrades will become the first step the company takes to offering account access through non-PC devices.
Not everyone in the industry shares Robertson's view, however.
One executive at a major online retailer, who spoke under the condition of anonymity, said a handful of online CD retailers turned down the opportunity to partner with MP3.com in this venture. Some were apparently wary of potential copyright problems that could result from legal action taken by the recording industry.
"It's an offensive move toward all the labels," the executive said.
Furthermore, the executive criticized MP3.com because of its decision to keep an archive of music titles on its servers. Ownership and distribution of music should be in the hands of the industry and its partners, not a non-affiliated site such as MP3.com, the executive said.
"What most companies are doing is working on secure music downloads so they can get access to it," the executive said. "By using the CD as a key, this is a completely non-secure method to giving people access to digital music that can be distributed anywhere."
But according to Michael Rhodes, a partner with law firm Cooley Godward, which represents MP3.com, users must accept a terms of service agreement not to allow others access to their accounts. Violators could risk having their accounts terminated.
Furthermore, because access to the CD online is playback only, users cannot bulk email songs to friends, which other technologies allow users to do.
"You can take a CD and put it into your hard drive, rip it and then email it around the world," Rhodes said in an interview. "You can't send an MP3 to us and virally propagate the music."