Online music store
Encyclopedia
An online music store is an online
business which sells audio files, usually music, on a per-song and/or subscription basis. It may be differentiated from music streaming services in that the music store offers the actual music file
, while streaming services offer partial or full listening without actually owning the source file. However, music stores generally offer partial streaming previews, some even with full length.
. IUMA was started by Rob Lord, Jeff Patterson and Jon Luini from the University of California, Santa Cruz
in 1993
In 1998, Miami entrepreneur Ivan J. Parron
, president of successful web development company Internet Marketing Consultants, Inc.
, founded and launched Ritmoteca.com
as one of the early online music store business models. It allowed visitors to visually search through a jukebox-style catalog of over 300,000 songs organized by album
s, listen to a :30 music clip or music video
and purchase the MP3 format download. It sold single songs for $.99 and entire album
downloads for $9.99. The company's revolutionary graphical user interface opened the door to signing distribution deals with Universal Music Group
, Sony Music Entertainment
, Bertelsmann Music Group and Warner Music Group
. These agreements gave the company online digital distribution rights for artists such as U2
, Madonna (entertainer)
, Britney Spears
, Enrique Iglesias
and Jay-Z
. The company concept had originally been for the consumer to download an Mp3 and burn it onto a CD. However, early MP3 players from companies like Creative Labs began to appear.
The realization of the market for downloadable music grew widespread around the time of Napster
, a music and file sharing
service created by Shawn Fanning
that made a major impact on the Internet scene during the year 2000. Some services have tethered downloads, meaning that playing songs requires an active membership.
The major record labels eventually decided to launch their own services, allowing them more direct control over costs. Sony Music Entertainment
's service did not do as well as was hoped. Many consumers felt the service was difficult to navigate and use. Sony's pricing of US$3.50 per song track also discouraged many early adopters of the service. Furthermore, as MP3 Newswire
pointed out in its review of the service, users were actually only renting the tracks for that $3.50. After a certain point the files expired and could not be played again without repurchase. The service quickly failed.
Undaunted, the record industry tried again. Universal Music Group
and Sony Music Entertainment
teamed up with a service called Duet, later renamed pressplay
. EMI
, AOL/Time Warner and Bertelsmann Music Group teamed up with MusicNet. Again, both services struggled, hampered by high prices and heavy limitations on how downloaded files could be used once paid for. In the end, consumers chose instead to download music using free file sharing programs, which many felt were more convenient and easier to use.
Non-major label services like eMusic
, Cductive
and Listen.com (now Rhapsody
) sold the music of independent labels and artists to keep in the game, however digital audio
download demand skyrocketed after the launch of the iTunes Store
(then called iTunes Music Store) and the creation of portable music and digital audio players. This enabled music fans to take their music with them, wherever they went.
There are also an increasing amount of new services popping up that enable musicians to sell their music directly to fans
without the need for a 3rd party. These type of services usually use e-commerce enabled web widgets that embed into many types of web pages. This turns each web page into the musician's own online music store.
A more recent development allows the instant downloading of radio-songs, as they are broadcast, straight to a mobile phone in less than 60 seconds. This technical innovation from Sweden, called DROPme, represents a different channel and consumer behavior relative to the online services.
As of April 2008, one of the largest online music service is iTunes Store
with around 80% of the market. On April 3, 2008 iTunes Store surpassed Wal-Mart
as the biggest music retailer in the US, a milestone in the music industry as it is the first time in history that an online music retailer exceeds those of physical music formats.
Compared to file sharing
Much controversy surrounds this issue, so many or perhaps all of these points are disputed.
ONLINE
ONLINE is a magazine for information systems first published in 1977. The publisher Online, Inc. was founded the year before. In May 2002, Information Today, Inc. acquired the assets of Online Inc....
business which sells audio files, usually music, on a per-song and/or subscription basis. It may be differentiated from music streaming services in that the music store offers the actual music file
Audio file format
An audio file format is a file format for storing digital audio data on a computer system. This data can be stored uncompressed, or compressed to reduce the file size. It can be a raw bitstream, but it is usually a container format or an audio data format with defined storage layer.-Types of...
, while streaming services offer partial or full listening without actually owning the source file. However, music stores generally offer partial streaming previews, some even with full length.
History
The Internet's first free high fidelity online music archive of downloadable songs was the Internet Underground Music ArchiveInternet Underground Music Archive
The Internet Underground Music Archive was a pioneer of online music. IUMA was started by Rob Lord, Jeff Patterson and Jon Luini from the University of California, Santa Cruz in 1993, for the purpose of providing a venue for unsigned artists to share their music and communicate with their audience...
. IUMA was started by Rob Lord, Jeff Patterson and Jon Luini from the University of California, Santa Cruz
University of California, Santa Cruz
The University of California, Santa Cruz, also known as UC Santa Cruz or UCSC, is a public, collegiate university; one of ten campuses in the University of California...
in 1993
In 1998, Miami entrepreneur Ivan J. Parron
Ivan J. Parron
Ivan Jose Parron, Esq. is an American entertainment law attorney and entrepreneur often referred to as the inventor of the Online music store. He is the founder of and principal attorney for , an entertainment, media and sports law firm based in Miami Beach, New York City and Washington D.C...
, president of successful web development company Internet Marketing Consultants, Inc.
Internet Marketing Consultants, Inc.
Internet Marketing Consultants, Inc. was a consulting and web development company founded in 1995 by Internet entrepreneur and visionary Ivan J. Parron in Miami, Florida. During the Dot-com boom the company consulted on, developed and launched some of the first US brand-driven websites geared...
, founded and launched Ritmoteca.com
Ritmoteca.com
Ritmoteca.com was an online music store and early pioneer in the online downloadable music space. Founded in Miami, Florida in 1998 during the Dot-com bubble by Ivan J...
as one of the early online music store business models. It allowed visitors to visually search through a jukebox-style catalog of over 300,000 songs organized by album
Album
An album is a collection of recordings, released as a single package on gramophone record, cassette, compact disc, or via digital distribution. The word derives from the Latin word for list .Vinyl LP records have two sides, each comprising one half of the album...
s, listen to a :30 music clip or music video
Music video
A music video or song video is a short film integrating a song and imagery, produced for promotional or artistic purposes. Modern music videos are primarily made and used as a marketing device intended to promote the sale of music recordings...
and purchase the MP3 format download. It sold single songs for $.99 and entire album
Album
An album is a collection of recordings, released as a single package on gramophone record, cassette, compact disc, or via digital distribution. The word derives from the Latin word for list .Vinyl LP records have two sides, each comprising one half of the album...
downloads for $9.99. The company's revolutionary graphical user interface opened the door to signing distribution deals with Universal Music Group
Universal Music Group
Universal Music Group is an American music group, the largest of the "big four" record companies by its commanding market share and its multitude of global operations...
, Sony Music Entertainment
Sony Music Entertainment
Sony Music Entertainment ' is the second-largest global recorded music company of the "big four" record companies and is controlled by Sony Corporation of America, the United States subsidiary of Japan's Sony Corporation....
, Bertelsmann Music Group and Warner Music Group
Warner Music Group
Warner Music Group is the third largest business group and family of record labels in the recording industry, making it one of the big four record companies...
. These agreements gave the company online digital distribution rights for artists such as U2
U2
U2 are an Irish rock band from Dublin. Formed in 1976, the group consists of Bono , The Edge , Adam Clayton , and Larry Mullen, Jr. . U2's early sound was rooted in post-punk but eventually grew to incorporate influences from many genres of popular music...
, Madonna (entertainer)
Madonna (entertainer)
Madonna is an American singer-songwriter, actress and entrepreneur. Born in Bay City, Michigan, she moved to New York City in 1977 to pursue a career in modern dance. After performing in the music groups Breakfast Club and Emmy, she released her debut album in 1983...
, Britney Spears
Britney Spears
Britney Jean Spears is an American recording artist and entertainer. Born in McComb, Mississippi, and raised in Kentwood, Louisiana, Spears began performing as a child, landing acting roles in stage productions and television shows. She signed with Jive Records in 1997 and released her debut album...
, Enrique Iglesias
Enrique Iglesias
Enrique Iglesias is a Spanish pop music singer, a son of singer Julio Iglesias.Enrique started his musical career on Mexican label Fonovisa...
and Jay-Z
Jay-Z
Shawn Corey Carter , better known by his stage name Jay-Z, is an American rapper, record producer, entrepreneur, and occasional actor. He is one of the most financially successful hip hop artists and entrepreneurs in America, having a net worth of over $450 million as of 2010...
. The company concept had originally been for the consumer to download an Mp3 and burn it onto a CD. However, early MP3 players from companies like Creative Labs began to appear.
The realization of the market for downloadable music grew widespread around the time of Napster
Napster
Napster is an online music store and a Best Buy company. It was originally founded as a pioneering peer-to-peer file sharing Internet service that emphasized sharing audio files that were typically digitally encoded music as MP3 format files...
, a music and file sharing
File sharing
File sharing is the practice of distributing or providing access to digitally stored information, such as computer programs, multimedia , documents, or electronic books. It may be implemented through a variety of ways...
service created by Shawn Fanning
Shawn Fanning
Shawn Fanning is an American computer programmer, serial entrepreneur, and angel investor. He developed Napster, one of the first popular peer-to-peer file sharing platforms, in 1998. The popularity of Napster was widespread and Fanning was featured on the cover of Time magazine...
that made a major impact on the Internet scene during the year 2000. Some services have tethered downloads, meaning that playing songs requires an active membership.
The major record labels eventually decided to launch their own services, allowing them more direct control over costs. Sony Music Entertainment
Sony Music Entertainment
Sony Music Entertainment ' is the second-largest global recorded music company of the "big four" record companies and is controlled by Sony Corporation of America, the United States subsidiary of Japan's Sony Corporation....
's service did not do as well as was hoped. Many consumers felt the service was difficult to navigate and use. Sony's pricing of US$3.50 per song track also discouraged many early adopters of the service. Furthermore, as MP3 Newswire
MP3 Newswire
Founded in 1998, the same year as MP3.com, MP3 Newswire is the oldest active news site devoted to digital media technology. Notable for its series of essays that chronicled the rise of digital music and the Internet’s acrimonious relationship with the record industry, MP3 Newswire initially was...
pointed out in its review of the service, users were actually only renting the tracks for that $3.50. After a certain point the files expired and could not be played again without repurchase. The service quickly failed.
Undaunted, the record industry tried again. Universal Music Group
Universal Music Group
Universal Music Group is an American music group, the largest of the "big four" record companies by its commanding market share and its multitude of global operations...
and Sony Music Entertainment
Sony Music Entertainment
Sony Music Entertainment ' is the second-largest global recorded music company of the "big four" record companies and is controlled by Sony Corporation of America, the United States subsidiary of Japan's Sony Corporation....
teamed up with a service called Duet, later renamed pressplay
Pressplay
Pressplay was the name of an online music store from 2002 - 2003 created as a joint venture between Universal Music Group and Sony Music Entertainment. The two record labels provided music via subscription for pressplay along with BMG, EMI, Warner Music Group and various independent labels. It was...
. EMI
EMI
The EMI Group, also known as EMI Music or simply EMI, is a multinational music company headquartered in London, United Kingdom. It is the fourth-largest business group and family of record labels in the recording industry and one of the "big four" record companies. EMI Group also has a major...
, AOL/Time Warner and Bertelsmann Music Group teamed up with MusicNet. Again, both services struggled, hampered by high prices and heavy limitations on how downloaded files could be used once paid for. In the end, consumers chose instead to download music using free file sharing programs, which many felt were more convenient and easier to use.
Non-major label services like eMusic
EMusic
eMusic is an online music and audiobook store that operates by subscription. It is headquartered in New York City with an office in London and owned by Dimensional Associates. As of September 2008 eMusic has over 400,000 subscribers....
, Cductive
Cductive
Cductive was a pioneering online music store founded in 1996 by Thomas V. Ryan, John Rigos, and Alan Manuel. It sold 99 cent mp3 downloads and custom CD compilations from a selection of several hundred independent record labels. In December 1999, the company was acquired by main rival eMusic and...
and Listen.com (now Rhapsody
Rhapsody (online music service)
Rhapsody is an online music store subscription service, launched in December 2001, and available in the United States only. On April 6, 2010, Rhapsody officially declared its independence from RealNetworks. Downloaded files come with restrictions on their use, enforced by Helix, Rhapsody's version...
) sold the music of independent labels and artists to keep in the game, however digital audio
Digital audio
Digital audio is sound reproduction using pulse-code modulation and digital signals. Digital audio systems include analog-to-digital conversion , digital-to-analog conversion , digital storage, processing and transmission components...
download demand skyrocketed after the launch of the iTunes Store
ITunes Store
The iTunes Store is a software-based online digital media store operated by Apple. Opening as the iTunes Music Store on April 28, 2003, with over 200,000 items to purchase, it is, as of April 2008, the number-one music vendor in the United States...
(then called iTunes Music Store) and the creation of portable music and digital audio players. This enabled music fans to take their music with them, wherever they went.
Current market
Recently, there has been a boom in "boutique" music stores that cater to specific audiences.There are also an increasing amount of new services popping up that enable musicians to sell their music directly to fans
Direct-to-Fan
Direct-to-Fan is a business model used by independent musicians, independent music labels, music marketing professionals, promoters, and others in the music industry...
without the need for a 3rd party. These type of services usually use e-commerce enabled web widgets that embed into many types of web pages. This turns each web page into the musician's own online music store.
A more recent development allows the instant downloading of radio-songs, as they are broadcast, straight to a mobile phone in less than 60 seconds. This technical innovation from Sweden, called DROPme, represents a different channel and consumer behavior relative to the online services.
As of April 2008, one of the largest online music service is iTunes Store
ITunes Store
The iTunes Store is a software-based online digital media store operated by Apple. Opening as the iTunes Music Store on April 28, 2003, with over 200,000 items to purchase, it is, as of April 2008, the number-one music vendor in the United States...
with around 80% of the market. On April 3, 2008 iTunes Store surpassed Wal-Mart
Wal-Mart
Wal-Mart Stores, Inc. , branded as Walmart since 2008 and Wal-Mart before then, is an American public multinational corporation that runs chains of large discount department stores and warehouse stores. The company is the world's 18th largest public corporation, according to the Forbes Global 2000...
as the biggest music retailer in the US, a milestone in the music industry as it is the first time in history that an online music retailer exceeds those of physical music formats.
Compared to file sharingFile sharingFile sharing is the practice of distributing or providing access to digitally stored information, such as computer programs, multimedia , documents, or electronic books. It may be implemented through a variety of ways...
Much controversy surrounds this issue, so many or perhaps all of these points are disputed.Advantages
- Follows copyright laws.
- More consistent and higher quality meta-data, because the entering of the meta-data is more centralized and done by groups with financial interests.
- Music download companies are more accountable to users than creators of file-sharing programs
- Centralized repository of music makes it easier to find the songs you want.
- Notably, Apple Computer CEO Steve JobsSteve JobsSteven Paul Jobs was an American businessman and inventor widely recognized as a charismatic pioneer of the personal computer revolution. He was co-founder, chairman, and chief executive officer of Apple Inc...
claimed in his introduction of the iTunes StoreITunes StoreThe iTunes Store is a software-based online digital media store operated by Apple. Opening as the iTunes Music Store on April 28, 2003, with over 200,000 items to purchase, it is, as of April 2008, the number-one music vendor in the United States...
that file sharers get paid less than minimum wage for the work required to download audio.
Disadvantages
- Many major online music stores only offer music in one audio format. Most labels will not allow their music to be sold in the common MP3 format that music players use. For the most part music that is sold in MP3 format is not sold at higher bit rate encoding.
- Many stores use Digital Rights ManagementDigital rights managementDigital rights management is a class of access control technologies that are used by hardware manufacturers, publishers, copyright holders and individuals with the intent to limit the use of digital content and devices after sale. DRM is any technology that inhibits uses of digital content that...
, which limits use of music on certain devices. The restrictions vary between different services, and sometimes even between different songs from the same service. - Geographical restrictions rule most of the stores at the request of record labels.
- Many online music stores sell music encoded in a lossy format, compared to an audio CD.
- Users do not have a "hard copy" of purchased music, such as a CD, for archiving (although music can usually be backed up to a CD or portable music player).
- Some stores do not provide artwork or liner notes.
- Stores have limited catalogs, because of copyright concerns.
- Some stores are not operating systemOperating systemAn operating system is a set of programs that manage computer hardware resources and provide common services for application software. The operating system is the most important type of system software in a computer system...
independent and usually require the use of Microsoft WindowsMicrosoft WindowsMicrosoft Windows is a series of operating systems produced by Microsoft.Microsoft introduced an operating environment named Windows on November 20, 1985 as an add-on to MS-DOS in response to the growing interest in graphical user interfaces . Microsoft Windows came to dominate the world's personal...
to use their software.