Liquid Audio server drawing industry raves at confab

CANNES — Digital distribution of music on the Internet emerged as the most compelling Midem 1998 issue by Wednesday, the last complete day of business, with initially ambivalent indie record companies beelining their way to participants offering the new technology.

A series of conferences at the music market spotlighted digital distribution as a way indies can bypass the limitations of conventional distribution, such as limits on record store space for niche product. The conferences also helped allay security concerns on piracy — fears similar to those plaguing DVD — by outlining encryption measures that in theory should be nearly impossible to beat.

Poised to gain the most is the two-year-old Silicon Valley-based company Liquid Audio, which is allied with Microsoft and whose six month-old server received virtual endorsement at Midem from Ralph Peer II, CEO of U.S. indie music publisher Peer Music.

Other excitement

Kevin Malone, Liquid Audio’s director of international sales, told Daily Variety, “The fear of digital distribution is now offset by an equal amount of excitement — we’ve had interest from all quarters and we’ll be announcing several major developments shortly.”

Although many observers believe Liquid Audio’s server could become the dominant standard globally, there are others — such as France’s Eurodat, the U.K.’s Cerberus and a slew more companies — vying for a slice of the eventually huge digital distribution pie.

Francois-Xavier Nuttall, CEO of France’s Audiosoft — which is showcasing its CityMusic server system at Midem, and who described interest in his product as “exponential” — said, “It’s far from a done deal that one company will dominate (digital distribution); the legal frameworks in different countries are not that easy to control and handle.”

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