Online music store

A online music store is a service In line of sale of Musique, generally by piece, album, or monthly Abonnement. The market for this service type developed at the time of the popularization of Napster, the Logiciel and service created by Shawn Fanning to allow the exchange of music which had an major impact on the world of Internet during the year 2000.

History

The reign of independent and the pirates

The sale of online music is born at the end of the Années 1990 in the form of Web sites selling audio files. In September 1997, MP3.com is launched to allow the promotion of groups and interpreters independent, but it is EMusic which in July 1998 is the first site to sell music in the shape of files MP3.

The appearance of Napster in June 1999 and of KaZaA in September 2000, two software resting on the technology of the Peer to peer allowing the file-swapping in particular musical, will precipitate the interest of the industry of the disc towards the distribution on line.

The majors awake

It is Sony which is the first company to legally sell on line the music of a large recording company ( Major ) in April 2000. Sony Music Entertainment announces quickly a partnership with Universal Music Group to propose a service of distribution of online music per subscription, Duet - the service will be renamed Pressplay in June 2001, and is joined in October of the same year by EMI. The service is launched in December in the United States, the same month as two competitor services, Rhapsody of Listen.com, and MusicNet.

In Europe, the British company OD2 WebAudioNet lance in August 2001, a service intended to provide to the distributers a platform remote loading legal from which they can sell subscriptions. The next month, Vivendi acquires MP3.com, which will be later resold with Hundred Networks. The Italian Tiscali becomes in November the first to propose a Pan-European service whose catalog includes repertories coming from the four majors .

Meanwhile, Napster had to close shop, following a continuation of the Recording Industry Association off America (RIAA) for violation of royalty. In 2002, the rate/rhythm accelerates whereas the labels exploit the reciprocity: Sony Music Entertainment, BMG Entertainment and EMI Recorded Music sign to see their respective catalog distributed on Rhpasody, joined soon by Warner Music Group and Universal Music Group. Warner signs to distribute his repertory on Pressplay. MusicNet makes from the agreements with Universal, Sony and EMI to distribute their music.

In Europe, Wanadoo sign with OD2 to offer an online music service to its subscribers. OD2 continues its expansion while including with its catalog of the British independent labels. Universal Music France lance e-compil, an online music store proposing several thousands of pieces of its catalog, and makes an agreement with Sony Music France to distribute 5000 of its pieces.

End of the Napster era

In March 2003, Real Networks becomes minority shareholder of Listen.com, the operator of Rhapsody. The developer of Logiciel S Roxio acquires Pressplay and Napster 2.0 renames it. It is also the launching of the first DIGITAL Download Day Europe, an initiative of OD2. The next month, Real Networks announces the acquisition of Listen.com, and Apple lance the ITunes Music Store in the United States, whose catalog includes repertories of the five majors . Each piece is sold there with the single tariff of 99 hundreds with the format AAC, and each album for 9,99 US Dollars (except exceptions).

It is the service of Apple which really will make take off the tendency of the legal distribution of online music. The firm of Cupertino has an asset of size: the success of sound Walkman IPod, narrowly integrated into the software ITunes, which allows from now on an easy access to the iTunes Music Store.

First downloading service to see day in France east e-Compil, of group Universal, which appears since 2001. VirginMega lance its service on May 18th, 2004, followed by Apple in June 2004, which proposes simultaneously versions of sound iTunes Music Store to the the United Kingdom, in Germany and France. The Fnac lance FnacMusic in September 2004, proposing with the sale pieces and albums with the format protected WMA of Microsoft. It is quickly followed by the Connect service from Sony, which seeks with its walkmans to emulate the success of Apple. According to the Observatory of the Music, in an investigation carried out in 2005, on average 85% of the albums of SIGNAL 100 were available on the legal platforms of remote loading in France.

In September 2004, the new version of EMusic is started again. Repurchased with Vivendi Universal in 2003 by Dimensional Associates, a firm of investments which has already the distributer of independent music The Orchard, the service chose to specialize in the sale of music of independent or more obscure interpreters with leading contents targeting the informed music lovers. The downloaded music is offered to format MP3, an higher capacity and without Gestion of the digital rights. This strategy seems to have made it possible eMusic to gain the second place, with 12% of the US market behind the service of Apple.

In 2005, iTunes lance its service with the Canada, in the remainder of the Swiss European Union and in , then with the Japan and in Australia. In the United States, Napster, from now on a legal platform subsidiary of BMG, offers a service by subscription and launches out in an aggressive publicity campaign against Apple. In May 2005, it is with the turn of the giant of Internet Yahoo! of launching on its side in large brass band Yahoo! Music Unlimited, a service by subscription.

The legislation the technology proof

The virtual nature of the digital music poses stakes of size for the industry of the disc. The collection of the incomes derived from the royalty by organizations such as the SACEM in France or ASCAP with the the United States is done on the level of each territory before being transferred with the authors and interpreters. The access to the online music stores in theory is thus reserved to the Internaute S of a country or specific territory. This restriction is generally operated thanks to the method of payment used, by checking for example the domiciliation of the institution having delivered the Bank card of the purchaser.

This restriction imposed by industry was in particular ignored by the Russian site AllofMP3.com, launched in 2001, allowing any holder of a bank card, whatever his domiciliation, to buy pieces or albums at prices largely lower than those practiced by the existing online stores. This tariff disparity can be explained by the inferiority of the Cost of living in Russia, but in May 2006, the International Federation off the Phonographic Industry (IFPI), an professional organization gathering the main actors of the world industry of the disc, showed AllofMP3.com not to pour any compensation with the artists or editors whose site sells the music, including in Russia. According to firm XTN Dated, ALLofMP3.com represented in May 2006 44% of the sales of online music among the British Net surfers .

Subscription or remote loading

The model which seems to currently obtain the most success is that of the remote loading. The fixed price per piece (99 hundreds in the United States, 99 eurocents in the Euro area) attracted many consumers who can from now on buy a piece alone without having to buy the whole album.

Another model developed, in particular in the United States, on the model of the subscription. The new offer of Napster allows for example, with the help of 9,95 US dollars per month, to download on a PC of the music at will. For 80 hundreds per piece, the music can be transferred on a walkman or engraved on CD. The " offer; Napster To Go" allows for 14,95 $ to transfer the music on a walkman compatible with protected format WMA. Rhapsody functions on a similar model, with a version " illimitée" to 9,99 $ per month. The version " Rhapsody To Go" the transfer allows towards a compatible walkman WMA protected. The pieces can be bought for 89 hundreds each in order to be preserved after cancellation of the subscription or engraved on CD. Always on the same principle, Yahoo! Music Unlimited makes it possible to at will download music with the help of 6,99 dollars per month (or 59,88 $ per annum). It is acted in fact like Napster and Rhapsody of a service pointing out the principle of the hiring, since the downloaded music cannot be any more read if the subscription is cancelled, unless paying 79 hundreds per piece.

eMusic proposes four levels of subscription to its service, but which concern more the fixed price, since tariffed to 9,95; 14,95 and 19,95 $, they respectively propose the remote loading of 40,65,90 and 200 pieces per month.

Formats and interworking

Apple seems to have confirmed its statute of leader in the field of the online music, with a market share moreover the 70% in the United States in 2005, number one in France with some 40% of market shares and 60% in Japan. The platform of Apple also distributes from now on vidéos musical, audio books, televised series (on its American version), and includes a directory of Podcast S.

The iTunes Music Store owes its success above all with integration with the iPod. The walkman can read various formats, in particular the MP3, WAV, the Apple Lossless, AIFF or the files with the format Audible. The music files downloaded on the online store of Apple are with the format protected AAC, that the iPod is the only walkman with being able to read. The Management of the digital rights used by Apple in iTunes and its iPod is indeed a solution owner, FairPlay. The majority of the competitor walkmans adopted format WMA protected from Microsoft and are compatible with the software Windows Media Player. Napster, VirginMega or FnacMusic sell music files with this format, which is not compatible with iTunes or the iPod. Like the service of Apple, the Connect service from Sony requires to him also the installation of a dedicated software, Sonic Stage, and the downloaded audio files are with format ATRAC-3, a format owner. Sony however announced the May 9th 2006 that the next version of Sonic Stage would manage format AAC.

The site eMusic is distinguished from its main competitors by the sale of pieces to format MP3 without Gestion of the digital rights (GDN), but only the music of independent labels distributes, owing to the fact that it does not manage to find agreements with the Majors, who are opposed to the total distribution their catalogs with this format. Yahoo! try out since July 2006 with the sale of pieces to format MP3 and without GDN, but at a higher price, in fact 1,99 US dollars, with the possible objective cause a drop in the price with 1,09 $.

Moreover, only the iTunes Music Store is compatible with the users of Mac OS X, the Operating system of Apple. The competitor online music stores (except for eMusic) require a configuration Windows in order to be able to play and transfer the music on a walkman. The majority of these services however allow the engraving of the music downloaded on Compact disk, which can be then read on the near total of the relatively recent readers. The number of engravings is however generally limited, in particular for the albums.

The Interworking between online music services and walkmen is one of the points which were discussed in particular in France with the National Assembly within the framework of the Loi DADVSI, then during the examination of the text by the Constitutional council at the end of July 2006. The text voted by the Senate thus envisaged an exception to the sorrows incurred by the skirting of technologies of GDN at ends of research or interworking, but the Constitutional council, estimating that the concept of interworking had not been sufficiently defined in the text of the bill, removed this exception.

Some online music services

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