June 30, 1999
Questions Abound on Downloading Digital Music
By MATT RICHTEL 
ALO ALTO, Calif. -- Although
members of the music and electronics industries described standards announced on
Monday as a watershed for distributing
music over the Internet, numerous obstacles could very well prevent the personal
computer from becoming the jukebox and
record store of the future.
Still outstanding are meaty questions
about what technology will be used to deliver and protect copyrights of music sold
online. And while the consortium that is
creating the standards, the Secure Digital
Music Initiative, represents the music, consumer electronics and computer industries, it is not at all certain that the makers
of portable music players will comply with
standards that are being dictated largely
by the interests of record labels.
All of which is likely to leave consumers
bewildered in the coming months, even as
electronics companies ramp up production
of the new players -- solid-state equivalents of today's portable cassette and CD
players -- in the hopes of making the
coming holiday season the first digital-music Christmas.
What is certain is that with the preliminary release of new standards for distributing music electronically -- -- music companies are ramping up for online sales of
their recordings, as evidenced by two disclosures on Tuesday from Bertelsmann,
the parent company of BMG Entertainment.
A Bertelsmann subsidiary, BMG Storage
Media, based in Guetersloh, Germany, that
records audio CD's and video DVD's, today
announced a partnership with Intertrust
and Reciprocal, two American companies
that make technology for distributing music in digital form while preserving its
copyrights.
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Issues of copyright,
antitrust laws and
technology remain to
be addressed.
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Officials from BMG Storage Media said
that starting next quarter, the partners
would test technology to print new CD's
that are compliant with the S.D.M.I. standard, which means the music cannot
be played on portable devices if the
device's owner has not paid for the
music.
This is not simple to accomplish.
First, future CD's have to be playable on existing CD players, which
tend to be highly sensitive to the way
data are organized on a CD. Second,
because the Home Recording Act of
1992 allows anyone who purchases a
CD to make a copy for personal use,
the protection technology will have
to distinguish between a recording
device owned by the purchaser of the
CD and a device owned by someone
else. As the Intel and Microsoft Corporations discovered this year, machines that attempt to identify themselves or their owners on a network
provoke angry outcries from privacy
advocates.
On a different front, BMG, among
the biggest of the record companies,
announced today that it would begin
selling music over the Internet in the
fall. But, as is the case with other
major record labels planning online
sales, BMG has yet to decide which
artists it will sell online, whether it
will sell just singles or entire albums,
what prices it will charge and what
technology it will use to prevent illegal copying.
"These are all good questions,"
said J. Scott Dinsdale, a spokesman
for BMG. "We're going through that
process right now."
Also, today marked the start of a
project in which the five major
record labels are testing the sale of
music over the Internet using I.B.M.
technology. Trial participants in
1,000 homes in San Diego equipped
with cable modems can order music
online, pay for it with a credit card,
download it onto their PC and record
into homemde CD's.
Further, it remains to be seen how
soon consumers will buy into the online music revolution, given that it
takes 10 minutes to download a single song (more than 3 hours for a
typical album) using a standard dial-up modem, and the downloading process is often fraught with technical
difficulties.
The preliminary S.D.M.I. standards -- set to be finalized within the
next month -- are meant to dictate
the technical specifications for portable digital players, hand-held devices that record and play music on
silicon circuitry called flash memory. The new players are the center of
a shift in musical products that
many recording industry veterans
see as revolutionary because they
enable people to download music
from the Net, organize it, easily
erase it and listen to it portably in
CD-quality form.
Not surprisingly, the players are
generating deep-seated fears within
the music industry of widespread
piracy because the music they
record and play can be taken from
commercial CD's or the Internet and
copied illegally. Under the standards
announced on Monday, these players
eventually -- S.D.M.I estimates
about 18 months -- should not be
allowed to play illegally copied music.
Theoretically, what will happen is
that the portable players will read a
piece of software code embedded in
the digital version of each song that
tells the player whether making a
copy is permissible. Record labels
have said they will start to encode
each song sold over the Internet with
copyright protection information.
Within 18 months, the companies
also intend to start encoding each CD
sold in a store with similar technology, known generically as a digital
watermark.
But this technology is not yet perfected; numerous companies have
submitted proposals to the S.D.M.I.,
but none has yet been chosen, and it
is unclear whether any single solution will accomplish the task.
Some critics assert that consumers who have already amassed a
sizable library of digital music cannot yet be sure that in the future
digital players will be capable of
playing recordings that are not
S.D.M.I. compliant. Howard A. Tullman, chief executive of Tunes.com, a
Chicago-based Web site that publishes thousands of songs from unsigned
artists and independent record labels, says he worries that S.D.M.I.
standards will lead to players that
will play only music that meets big
record labels' stamp of approval.
"People have invested hours and
hours or days taking own music collection and making it portable," he
said. "You can't tell the person no,
that's no good."
Meanwhile, Tara L. Lemmey,
president of the Electronic Frontier
Foundation, an online civil liberties
group, said the organization was exploring whether the S.D.M.I. standards might represent a violation of
antitrust laws or "fair use" policies
that permit the use of music and
other media for education or aesthetic criticism.
Representatives of S.D.M.I said
portable devices would be permitted
to play existing digital recordings --
most notably the thousands of MP3
files now on the Net. They have said
that even when portable devices are
in full compliance -- when the final
rules come into play -- the devices
will play all music unless the music
itself contains the protection software permitting it to be played only
by a copyright holder.
That said, even S.D.M.I. officials --
and some of the 150 or so technology,
music and electronics companies in
the consortium -- say many of the
questions cannot be answered until
the final specifications are approved.
Matt Richtel at mrichtel@nytimes.com welcomes your comments and suggestions.
