Sony Japan Makes Big Play For Online Music Biz

7-Apr-00

Sony Corporation said its Internet service provider in Japan would set up an online music distribution system with 10 major Japanese recording companies which together control 60 percent of the nation's recorded music market, Reuters reported Thursday. In a news conference, Sony Communications Network President Senji Yamamoto said the online provider will launch a new company, Label Gate, to develop a music portal site where users may download music sold by the participating record companies. Yamamoto, who will head Label Gate, said record label unit Sony Music Entertainment will participate in the venture. The record labels reportedly will control the content and pricing of their products, while Label Gate will provide payment infrastructure and customer support. As in the United States, online music distribution in Japan is still an infant industry, both in terms of record label participation and technological infrastructure. Nevertheless, Label Gate apparently will some face competition, namely from Internet investor Softbank Corp. and mobile phone service provider NTT Docomo, which previously announced plans for online music distribution. Late last month, Sony announced it soon would terminate a satellite-based music download service it launched last May in Japan. According to a published report there, the venture proved unprofitable for Sony because of competition from similar, Internet-based services. Source: Pro Sound News