Listen.com to offer legal CD-burning

NEWS

As it readies a new version of its online music subscription service, Listen.com plans to announce on Thursday agreements to allow consumers to burn CDs from digital files. It won't be the digital free-for-all seen in the popular file-swapping arenas, however. The company will charge consumers 99 cents (about 64 pence) per song, which means a full album of songs will cost only a few dollars less than the retail price. However, the deals are a sign that the major music labels are increasingly loosening their licensing policies for digital music. Several other companies, including major label-backed Pressplay and independent Full Audio, also have won limited rights to let consumers burn CDs from music acquired through paid subscription services. While none of the offers exactly match consumers' desires for complete, unrestricted rights to music, it's a critical step forward, analysts say. "CD burning is very important," said P.J. McNealy, research director with GartnerG2, a division of Gartner. "This is portability, and that's what consumers want." Listen's Rhapsody service, along with Pressplay, MusicNet and Full Audio, all are scrambling to build businesses based around access to a huge range of music for a relatively low monthly fee. Music labels' reluctance to give up digital rights has hampered all of the services' growth, however. Since their inception, the companies have labored under a comparison with file-swapping networks such as Kazaa or Grokster. Songs downloaded through those free services can be easily transferred to MP3 players or burned onto CDs. The subscription services have smaller catalogs, have limited ability to move songs to other devices, and most of all, cost between $10 and $15 per month. They are unambiguously legal, however -- while many other file-swapping services struggle with copyright issues. Each of the services has taken a slightly different approach to reaching consumers. Listen has focused on reaching broadband Internet subscribers, striking a range of distribution deals with leading high-speed ISPs (Internet service providers) such as Verizon Communications and DirecTV. A new version of Listen's Rhapsody service that includes the CD-burning function will be released next week, with the ability to burn custom CDs using songs from Universal Music, Warner Music Group, and nearly two dozen independent labels. While that leaves many popular artists out of the mix, it will include current favorites such as Eminem and Beck. While these songs can later be "ripped" by subscribers and turned into MP3 files, Listen itself is not offering direct downloads through Rhapsody. It has the licences to offer "tethered" downloads -- similar to files offered by Pressplay and MusicNet which put restrictions on copying and transfering to other devices -- but has decided to avoid this path for now, executives say. "We don't want to wind up introducing something that winds up confusing consumers," said Dave Williams, Listen's vice president of product management. The CD still matters most, he added. "Our research shows that most consumers who download do so with the primary end goal of burning CDs." None of the major subscription music services have released subscriber figures yet. Analysts have routinely cautioned that none are likely to reach widespread consumer adoption at least until next year, when licensing issues and business models have had more time to be worked out. "All these interim (licensing) steps are experiments by the record labels," McNealy said.

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