A Perfect Time For Digital NARM

EXCLUSIVE COVERAGE

Digital NARM - "the only music industry event solely focused on selling digital entertainment" - which begins today in San Francisco and runs through Thursday - couldn't come at a better time.

The online music world has seen a flurry of developments in the past few months. Much of the recent activity does not seem to bode well for the current digital-music-as-product business model. According to a recent study, the majority of music consumed in the U.S. is not paid. Digital distributors are struggling. From major labels pushing for an ISP tax, to their investments in Music 2.0 businesses, to Trent Reznor's experiments in giving away downloads and focusing primarily on selling physical products, rights holders appear to be rapidly losing faith in the ability of digital sales to generate much revenue.

But fortunately a significant percentage of consumers...

are still willing to pay for downloads. Amazon MP3 appears to be attracting new digital music customers. Last.fm reported an increase in download and CD sales after introducing free full-song streams. And with MySpace Music and other new services on the way, paid downloads aren't necessarily on their deathbed yet.

Regardless of how you feel about the current state of the music industry or what you hope its future holds, this is an important moment for digital music. I'm very interested to hear what the various Digital NARM panelists have to say about recent industry developments, where they see things heading, and what their strategies will be going forward. Over the next couple days I'll be reporting out on the topics discussed at the conference... stay tuned.
- LAURENCE TRIFON