Sony Music Entertainment Japan Bows Copy-protection System

Sony Music Entertainment Japan (SMEJ) introduced new copy-protection technology Nov. 20 that will enable music files to be copied onto personal computer hard drives in a way that the label can control.

Besides regular CD-audio tracks (which are not playable on PCs), CDs encoded with Sony's new Label Gate format will include a secondary sound source of compressed audio files that can be played back on and copied to PCs. To do that, users have to obtain a decoding key via a dedicated Web site. While the first copy of a song can be made free of charge, users will be charged roughly 200 yen ($1.63) for each additional copy they make.

Music data that has been copied to a PC's hard disk can be played back using proprietary playback software called Magiqlip. Label Gate will also employ Sony's OpenMG X digital-rights-management system (Billboard Bulletin, Aug. 9). As a first step, all SMEJ five-inch CD singles will be released in the Label Gate format starting Jan. 22, 2003.

Logistics and fulfillment for the system will be handled by Label Gate, a Sony subsidiary that provides system operation, online billing, data storage, and distribution services for Japanese labels operating download sites.

Besides Sony, 16 Japanese labels have a minority stake in Label Gate.

In recent months, Avex, Warner Music Japan, Toshiba-EMI, and Universal Music Japan have all released copy-protected CDs. Sony, which has lagged behind other Japanese record companies in introducing copy-protection, says it is encouraging other labels to adopt the Label Gate technology.