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-------------------------------------------------------------- This story was printed from ZDNet Australia. --------------------------------------------------------------
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Fur flies over viability of Aust online music business By James Pearce, ZDNet Australia December 16, 2003 URL: http://www.zdnet.com.au/news/business/soa/Fur-flies-over-viability-of-Aust-online-music-business/0,139023166,120281944,00.htm
Destra's chief executive officer, Domenic Carosa, has rejected criticism from respected music analyst Phil Tripp that the company's music service launched too early. Phil Tripp, who runs themusic.com.au, told ZDNet Australia Destra was too eager in launching its online music service. "They launched too early," said Tripp. "They wanted to get prime mover advantage by getting up before Xmas." Tripp said that because Destra had music from only two major record labels (Festival Mushroom Records and EMI), the site contained about 15 percent of the popular music sought by people. "Wouldn't it be logical to believe that 85 percent of people wouldn't find what they want?" asked Tripp. "What they're doing is alienating the consumer not embracing them." Carosa rejected the claims, pointing to the availability of artists such as Robbie Williams, Silverchair, Kylie Minogue and Madison Avenue as examples of popular music available on the site. "We had a mandate to launch when we had over 100,000 tracks, and we will continue to add tracks to the service over the next few months," Carosa told ZDNet Australia . "We just got a second batch of EMI catalogue in yesterday, which should be online in the next few days." Carosa said Destra was in discussion with the other record labels and expected to have their music available within the next 60 days. According to Carosa, record labels are beginning to see the benefit of online distribution. "Up until recently record companies have been portraying companies selling music online as the antichrist, now they've come to realise that the future of music is online." Carosa said record labels were viewing online downloads as a way to regain revenue lost due to piracy, and a way to take advantage of the 95 percent of their catalogue that is not available in stores. He said that although most of the songs available on the site cost AU$1.99, several songs would be uploaded that would cost 99c. Customers can register their interest in a song that is not available on the site, and be informed via e-mail when it becomes available. Tripp pointed out that albums were often sold for AU$20 or less in the stores, which would be cheaper than buying all the songs online as well as providing higher-quality music. Of course, the draw of online music is the ability to only buy one or two songs from an album, and possibly find songs that aren't available in stores.
Format fights The most common format for online music is MP3, which is how Destra has supplied music in the past. However, Carosa said the record labels required a solution that protected their artist's copyright, and required the use of WMA format. "It's the record company's decision to have music approved and sold under Microsoft digital rights management," said Carosa. "That's what the record companies understand." Carosa said Destra had made the technology easier to use, but at its core it was Microsoft digital rights management technology.
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