Music industry mulls digital future

Pressplay is one of the key legitimate music services

Digital music services will dominate the agenda of the Future of Music conference in Washington DC on Monday.

Industry figures are gathering at the conference after a tumultuous year for the American music business, with CD sales in the US down 3% on last year.

I think it is a challenge to migrate consumers from what they've been getting for free illegally to a pay service

Hilary Rosen, RIAA

While legitimate online music services such as Pressplay and MusicNet launched in 2001, early indications are that they have yet to capture the public's imagination.

The two services, offering a limited catalogue of songs for download, launched after the song-swapping system Napster was shut down by the courts after the music industry complained it was breaching copyright.

'Productive'

One industry analyst said that despite the legal action and the arrival of official services little had changed.

"It's really changed very little, which is unfortunate, because I think change would be very productive," said Eric Schierer, a digital music analyst with Forrester Research.

Speakers at the conference include Konrad Hilbers, chief executive of Napster, which is due to relaunch in the near future as a legitimate service.

The whole music landscape is still to be settled, especially after the US Department of Justice announced an investigation into alleged price collusion between MusicNet and Pressplay.

'Proven concept'

The rival systems have yet to convince consumers that they offer anything not available illegally, but free, from other sources, said Mark Mooradian, an analyst with Jupiter Media Matrix.

"It's important for them to have a proven concept out and start learning about consumer behaviour... this year is about watching the business strategy shake out rather than signing up record subscription numbers," he said.

Hilary Rosen, the recording industry's key lobbyist, said the services would find success in the long term.

"I think it is a challenge to migrate consumers from what they've been getting for free illegally to a pay service, but hopefully, as time goes on, the features and services of the services will win people over," said Rosen, president of the Recording Industry Association of America.