Hardware Firms Offer New Digital Options: Sanyo, Hp Among Companies Focusing On Storing...

NEW YORK-While labels continue to test the online music-distribution waters, a growing number of hardware companies-including just-announced entrants Sanyo and Hewlett-Packard (BillboardBulletin, Aug. 24)-are preparing to dive in with products designed to let consumers play back their downloaded music away from computers.
This "portability factor" is seen as key to developing a mainstream market for computer-delivered music, but the dominant form that it will take is still in flux.
On the one side are the so-called portable digital players, which download music onto flash cards that can store approximately 30-60 minutes of music, depending on the model. On the other are CD-R and CD-RW machines, which have increasingly been positioned by their manufacturers as a means for consumers to store and play back downloaded music.
Consumer electronics company Sanyo announced Aug. 23 that it will join the burgeoning "portables" market segment in the second quarter of 2000 with the release of a still-unnamed player based on Liquid Audio's software and microprocessors from Texas Instruments (TI). No price point has yet been set, but a company representative says it will be "competitive" with other units out at the time.
The device, which the company says will be compliant with Secure Digital Music Initiative guidelines, is part of a planned full line of audio products for playback and delivery of digital music, including portable stereos, automotive players, and in-store kiosk terminals that will be available from Sanyo later in 2000.
"We believe this is a very important technology for all audio products-portables, mini-systems, cars, everything-so we are planning to implement this technology across all our audio products," says Osamu Shimamoto, product manager at Sanyo. Shimamoto cautions, however, that such full-scale implementation is still some time away.
TI is supplying a hardware chip set and library of software decoders for the Sanyo portable player, while Liquid is providing its proprietary software solution, which includes copyright protection safeguards such as encryption, rights management, and watermarking technology.
Andrea Fleming, VP of corporate marketing for Liquid Audio, says that the company expects to be working with other hardware firms in the future as the online music-delivery market grows and, with it, the demand for a suite of products with which to play back such music.
"For us, we've never thought that it was fun just to have music in your computer," Fleming says. "We've always thought that the end point was getting it out of your computer, so we've always had built into our Liquid Player the ability to burn a CD, the ability to export to a device."
The TI/Liquid Audio platform, called SP3, enables music playback from Liquid's own music format, as well as multiple other compression formats, according to the company, which has recently expanded its "multi-format" mandate.
Sanyo's portable player will compete with units already out or due from companies including Diamond Multimedia, Thomson, Philips, Samsung, and Creative Labs. Sony also is believed to be preparing to enter the marketplace.
Also competing with the units, however, will be new and improved editions of an older technology: CD-R and CD-RW machines.
On Aug. 23, Hewlett-Packard announced the new HP CD-Writer Music, which it claims is the first CD-rewritable drive designed specifically for creating music CDs. The device allows users to create custom CDs from digital downloads off the Internet and to duplicate select tracks or the entire content of existing CDs, playable on standard CD players and CD-ROM drives.
The CD-Writer, with an estimated price of $299, will be available Sept. 1 at Circuit City and Best Buy stores in the U.S.
Meanwhile, Japanese hardware manufacturer Ricoh says it's planning a U.S. launch of CD-burning equipment specifically for MP3 files downloaded from the Internet. The product should be available by Christmas.
A Ricoh representative says the device has been developed solely for the U.S. market for now. "While we recognize MP3's potential in the marketplace and are following developments related to it," says the representative, "we are not yet certain whether it will become a generally used standard." Details on pricing were unavailable at press time.
New York online research company Jupiter Communications believes that CD-Rs and CD-RWs will be the "device of choice" for the music downloader within the next five years.
Some 12.4% of online individuals will be using recordable drives in 2003, Jupiter forecasts, as compared with 3.3% of online individuals using playback devices.