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Digital music store

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Digital music store

A digital music store is a business that sells digital audio files of music recordings over the Internet. Customers gain ownership of a license to use the files, in contrast to a music streaming service, where they listen to recordings without gaining ownership. Customers pay either for each recording or on a subscription basis. Online music stores generally also offer partial streaming previews of songs, with some songs even available for full length listening. They typically show a picture of the album art or of the performer or band for each song. Some online music stores also sell recorded speech files, such as podcasts, and video files of movies.

The first free, high-fidelity online music archive of downloadable songs on the Internet was the Internet Underground Music Archive (IUMA), which was started by Rob Lord, Jeff Patterson and Jon Luini from the University of California, Santa Cruz in 1993. Sony Music Entertainment Japan launched the first digital music store in Japan on 20 December 1999, entitled Bitmusic, which initially focused on A-sides of singles released by Japanese domestic musicians.

The realization of the market for downloadable music grew widespread with the development of Napster, a music and file sharing service created by Shawn Fanning that made a major impact on the Internet scene in 2000. Some services have tethered downloads, meaning that playing songs requires an active membership. Napster was founded as a pioneering peer-to-peer (P2P) file sharing Internet service that emphasized sharing audio files, typically music, encoded in MP3 format. The original company ran into legal difficulties over copyright infringement, ceased operations and was eventually acquired by Roxio. In its second incarnation Napster became an online music store until Rhapsody acquired it from Best Buy on 1 December 2011. Later companies and projects successfully followed its P2P file sharing example such as Gnutella, Freenet, Kazaa, Bearshare, and many others. Some services, like LimeWire, Scour, Grokster, Madster, and eDonkey2000, were brought down or changed due to similar circumstances.

In 2000, Factory Records entrepreneur Tony Wilson and his business partners launched an early online music store, Music33, which sold MP3s for 33 pence per song.

The major record labels eventually decided to launch their own online stores, allowing them more direct control over costs and pricing and more control over the presentation and packaging of songs and albums. Sony Music Entertainment's service did not do as well as was hoped. Many consumers felt the service was difficult to navigate and use. Sony's pricing of US$3.50 per song track also discouraged many early adopters of the service. Furthermore, as MP3 Newswire pointed out in its review of the service, users were actually only renting the tracks for that $3.50, because the patron did not own the audio file. After a certain point the files expired and could not be played again without repurchase. The service quickly failed.

Undaunted, the record industry tried again. Universal Music Group and Sony Music Entertainment teamed up with a service called Duet, later renamed pressplay. EMI, AOL/Time Warner and Bertelsmann Music Group teamed up with MusicNet. Again, both services struggled, hampered by high prices and heavy limitations on how downloaded files could be used once paid for. In the end, consumers chose instead to download music using illegal, free file sharing programs, which many consumers felt were more convenient and easier to use.

Non-major label services like eMusic, Cductive and Listen.com (now Rhapsody) sold the music of independent labels and artists. The demand for digital audio downloading skyrocketed after the launch of Apple's iTunes Store (then called iTunes Music Store) in April 2003 and the creation of portable music and digital audio players such as the iPod. These players enabled music fans to carry their music with them, wherever they went.

Amazon launched its Amazon MP3 service for the US in September 2007, expanding it gradually to most countries where Amazon operates.

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