System tracks path of digital tracks sold

NEW YORK — In an effort to ensure that artists and copyright holders are paid for the sale of their works online, the music industry’s two main trade orgs Monday unveiled a standardized electronic identification system for tagging music tracks on a CD.

Initiative marks a rare instance of cooperation and accord among the Big Five record groups, whose prior efforts at coordinated development of digital technologies have ended with infighting and yielded precious little results.

The Global Resource Identifier system, or Grid, was developed jointly by the London-based Intl. Federation of the Phonographic Industry and the Recording Industry Assn. of America to help track digital content after it’s transferred into cyberspace.

According to the IFPI, the Grid system is effectively an electronic version of the Universal Product Code symbol found on the back of CD jewel cases, but with more digits, to allow for unique codes on more than 30 million separate music files.

Users pay $250 annual fee

With the Grid numbers in place, online music sellers will be able to quickly and accurately track the path of digital tracks sold and then report those sales volumes directly to rights holders for payment. Grid users will pay a $250 annual fee for use of the system, to be administered by the IFPI.

The IFPI and RIAA said they have no plans as yet to use the system to track songs that have been uploaded to free file-sharing networks such as Kazaa or Morpheus, which, along with widespread CD burning, are blamed for the industry’s steep sales declines in the past year.

Industry progress

The industry made some headway in selling music online in 2002. Two label-backed services — MusicNet and Pressplay — won licenses for music from all five of the majors and began to offer more flexibility in what users could do with their tracks. At the same time, companies like Listen.com, FullAudio and EMusic expanded and refined their offerings.

Yet the record labels have a lousy record to date of collaborating on digital technologies. The most infamous example is the Secure Digital Music Initiative, or SDMI, a program that ran for several years and attempted to create a standard for piracy protection on CDs.

The effort effectively imploded last year, a victim of protracted infighting among labels over even the basic framework of the agreement.

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