Digital Audio Business Sees Interesting New Uses

Recording industry executives, as well as online merchandisers, will be watching closely two new experiments in the use and distribution of digital audio via the Internet.

Virgin Megastores plans to marry Internet audio distribution with standard retail selling when it allows in-store customers to create custom CDs using music available on Internet sites. Meanwhile, pop music group They Might Be Giants plans to release its latest album exclusively on the Internet, allowing consumers to buy songs separately or the entire album and download them.

Virgin plans to become the first music retailer to offer customizable CDs when it opens a new store in Columbus, Ohio, today. Virgin will provide in-store Internet access to tracks from Liquid Audio’s Liquid Music Network, Cductive, AMP3.com, Amplified.com, songs.com, Riffage.com, Noisebox and Audio Explosion’s Mjuice. Virgin’s relationships with eight different online music sites not only gives customers access to a wide variety of music genres and titles – it also helps Virgin steer clear of the format battle by linking to sites with several different audio formats.

After previewing and selecting individual tracks on a touch-screen kiosk in the Virgin stores, customers can have the music pressed into a custom CD while they wait. RedDotNet Inc. supplied the broadband network and digital delivery system for the service. This fall, Virgin customers will also be able to download albums directly from major record labels. Virgin is also available on the Web at Virgin Megastore Online.

Giant Online Album

They Might Be Giants will take a giant leap into the profitability abyss next Monday, when it puts its new “Long Tall Weekend” album on sale at EMusic.com (Nasdaq: EMUS). The launch of the new digital album, exclusively in MP3 format, will be co-hosted by Yahoo! Entertainment (Nasdaq: YHOO).

Yahoo! will carry a live chat with the band members and then will host a launch party concert by the group live from New York City. At the same time, EMusic.com will allow fans to sample, download and purchase They Might Be Giants’ new MP3 album online. The entire album will sell for $8.99, and individual songs will sell for 99 cents each. The album is the band’s eleventh.

For Yahoo! Music and EMusic.com, the event also kicks off their participation in the 5th Annual New York Digital Club Festival July 20 through 23. Yahoo! is official sponsor of the music event online, while EMusic.com, an associate sponsor, plans to host the festival’s closing night party.

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