Aol Venture To Sell Singles

The Hub, an online venture between the nation's leading Internet service provider, America Online (AOL), and New Line Television, is planning to sell downloadable music singles on its new World Wide Web site (http://www.thehub.com) and direct to AOL's 9 million users.
The Hub's music retail venture, which debuts Sept. 23, is expected to offer CD-quality tracks from about 1,000 established and developing artists using technology developed by Redwood City, Calif.-based Liquid Audio.
The development, which had not been formally announced at press time, is likely to give a substantial boost in awareness to digitally downloadable music commerce. Internet consumers will be able to permanently store their CD-quality song purchases on their computer hard drives. Consumers with CD-Recordable (CD-R) drives on their computers will be able to make a permanent copy of their purchases.
Liquid Audio's technology allows the owner to play the music on one or more computers, but tracks can only be recorded on a CD-R one time.
In addition, the technology allows for proper payment and accounting of mechanical and publishing royalties (Billboard, March 15).
Consumers without a CD-R drive will be able to request a made-to-order CD from the Hub, which will deliver customized CDs direct to consumers through the mail. The Hub is near to completing a deal with a major distributor for its physical retail sales, says Marshall Klein, director of business affairs at the Hub.
'This is just the tip of the iceberg,' says Klein. 'We hope that larger labels will start to recognize that this technology is safe and that there is a way to make money doing this. Today, burning your own CDs is a foreign thing to most people, but it won't be long before this technology is more commonplace.'
In addition to direct downloadable singles sales, the site will also promote the retail availability of downloadable singles on other labels' sites, such as Capitol Records. Capitol is the only major label to announce plans to use the technology (Billboard, Sept. 13). The label has already unveiled plans to sell Internet-downloadable singles from Duran Duran, Spearhead, and other acts on its own Web site (http://www.hollywoodandvine.com).
Most of the Hub's offerings will initially be from independent labels, according to Klein. Though no specific labels were identified at press time, it is likely that independent labels already using Liquid Audio technology, such as Knitting Factory and IUMA, will participate in the venture.
Prices will vary track by track, but many offerings will be available for 99 cents, according to Scott Burnett, Liquid Audio VP of marketing.
'The pricing will vary depending on the length of the song, the popularity of the artist, and other factors,' says Burnett.
Sources say that the Hub will receive a small percentage of each music transaction. However, Klein declines to comment on the specifics of the deal.
Specific marketing plans for the new retail program were also undetermined at press time. However, Klein says that the Hub will use its high-profile presence on AOL's front screen to help drive Web traffic to the retail effort.
BRETT ATWOOD
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