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REAL DOWNLOAD ON MUSIC DEBATE CENTERS ON WHETHER OWNING OR RENTING TUNES IS INDUSTRY'S FUTURE.

Byline: Evan Pondel Staff Writer

Record labels don't care how consumers purchase their digital music, but Napster and Yahoo believe offering subscription services akin to cable TV is the only way to go, panelists said Wednesday at the iHollywood Forum in Universal City.

As Napster and Yahoo vie for more subscribers, Virgin Records and Universal are focusing their efforts on attracting a bigger audience.

Record label executives say they recognize that Napster and Yahoo serve as profitable alternatives to illegal file sharing, ``but I see a certain generational divide between ownership and not having something tangible,'' said Syd Schwartz, vice president of interactive marketing at Virgin, noting that some people prefer owning a piece of music versus temporarily storing it on their hard drive a la Napster, Yahoo and others.

At the center of the debate is whether younger consumers would rather subscribe to a music provider or prefer the a la carte offerings of an iTunesesque service. Drawing even more static: There is no universal method to download music. Whether it's an iPod, a Zen Micro or an Oakley Thump, each MP3 player requires different software to listen to music.

``And people don't want to do work to get their music,'' said Jay Frank, head of artist and label relations at Yahoo Music. ``And there are those who are perfectly happy turning on their radio. I still like listening to terrestrial radio.''

But that doesn't mean record labels still look to radio as a premier venue for showcasing their artists. Schwartz from Virgin Records said seeing an artist on iTunes' homepage is a big deal these days. On Wednesday, iTunes visitors could preorder Coldplay's new album by clicking on an icon at the top right of the page.

Even though iTunes doesn't require a monthly subscription, Wendy Nussbaum, a senior director at Universal, said the myriad forms of music-delivery services play a crucial role for the recording industry. ``It all depends on how the consumer wants the content,'' she said.

Laura Goldberg, chief operating officer of Napster, sees subscription- based services as the most effective model, especially as ``consumers become more digitally inclined.''

``There is no real reason to own music other than you like shiny boxes cluttering your home.''

Goldberg said the challenge is training parents to stop their children from illegally sharing music files.

At the same time, cellular phones are becoming an important tool for record labels looking to attract younger listeners. The reason: MP3 players can cost several hundreds of dollars, but many teenagers own cell phones and parents often pay the bills. Nussbaum said the problem is that retrieving music on a cell phone takes more time compared with an MP3 player.

But Mike Gaumond, general manager of media solutions at Motorola Inc., said while the technology to speed up the process is there, ``we are not trying to drive MP3 players out of business. Right now we are co-existing.''

Evan Pondel, (818) 713-3662

evan.pondel(at)dailynews.com
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Title Annotation:Business
Publication:Daily News (Los Angeles, CA)
Date:Jun 9, 2005
Words:495
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