Sony teams on tune ‘Net

Label Gate to utilize broadband tech for music downloads

TOKYO — Sony Communications Network will team with 10 major Japanese record labels to form a company that will start distributing music over the Internet later this month.

The Sony Corp. unit will hold a 60% stake in the company, Label Gate, that will be capitalized at 50 million yen ($480,000). The music company will then double its capital later this month as it issues shares to the labels.

Broadband interest

The latest news fits into plans announced late in March by Sony president Nobuyuki Idei to make broadband technology one of the cornerstones of the company in the coming business.

Sony Music Entertainment Japan bowed a company in December, Bitmusic, that sells music over the Internet, making Sony Music Japan the first local music company with an online distrib system.

Sony also already has produced a flop in the music distrib business as its company that sold music over a communications satellite will fold in June. The company, Music Link, started service in May on Sky PerfecTV but failed to attract enough subs to justify operating costs.

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