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Last Updated: Monday, 22 January 2007, 12:10 GMT
Digital deal to boost new music
Apple iPod
This digital deal could offer new bands a break-through
A new deal will make it easier for independent record labels to sell digital downloads on websites such as MySpace and YouTube.

Independent labels around the world have set up an agency, Merlin, to cut deals with download sites and mobile services on their behalf.

The downloads will be sold in the MP3 format, meaning they can be played on any portable music player.

Indie labels account for 80% of new releases, but only 30% of revenues.

'Fifth major'

Universal Music, Sony BMG, EMI and Warner Music are the four major labels.

Merlin, which launched on Saturday, said it will act as the "fifth major" in the world, with a view to rectifying the "poor cousin" status of deals previously offered to independent labels.

In a statement Merlin said it aims to "improve access and level the playing field with new and emerging media."

It will allow online stores and other digital platforms to access its members' music in one deal, rather than the thousands of separate contracts they would otherwise have to negotiate.

Bands signed to independent labels include The White Stripes, The Pixies, Basement Jaxx and Arctic Monkeys.

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