At their annual products show in Paris, Sony executives on Thursday also said the company’s overall consumer electronics business was showing strong sales everywhere but in Europe, where they have not yet had a recovery.
Sir Howard Stringer, Sony vice chairman and head of its U.S. businesses, said the new service would start in the United States this spring and combine efforts of our music, electronics and pictures companies.
It will be supported by a wide range of Sony products, he said, including Walkman players and Vaio PC’s. The company is also planning a system for music downloads without the need for a personal computer, the Sony president, Kunitake Ando, said.
The download service, known within the company as Music Box, is part of Sony’s belated attempt to combat the free trading of songs in digital form over the Internet, which many in the industry blame for falling CD sales.
Stringer said the company, which owns the Epic and Columbia labels and is the home to such musicians as the Dixie Chicks and Bruce Springsteen, had not decided how to react to Universal Music Group’s announcement on Wednesday that it would cut prices of music CD’s by nearly 30 percent.
The pricing variation on CD’s is already so enormous, ranging from $8 all the way up to $18, Stringer said. I need to study that a little bit more thoughtfully.
As the recording industry makes the transition from physical products to those that exist primarily in digital form, Sony, Universal and the other major music labels last year began to license their recordings to various commercial online services that pay royalties to the artists.
Stringer sees the service started by Apple Computer, called iTunes Music Store, as the model for Sony to follow. Sony already has a one-year agreement to sell its songs through iTunes. The Apple service has received the most attention because of its pricing 99 cents a song and ease of use, plus the fact that it has spurred sales of Apple’s music player, the iPod.
We’re more interested at the moment in designing the delivery of music downloads, following the steps of Apple, Stringer said, but doing it ourselves so that we can generate sales of our own devices and make that business more acceptable to the consumer.
He said the music industry worldwide had lost more than $7 billion in value in the past two years.
This year, he said, Kazaa, an illegitimate file-sharing program, became the world’s most downloaded software, with 230 million downloads. Kazaa has been adding new users at a rate of 13 million a month, or 270 new members a minute.
Ando said Sony’s consumer electronics business, which accounts for 70 percent of sales and suffered early in the year, is not so bad now in the United States and Japan. But he called Europe the most difficult market among the three major regions. The Sony chairman and chief executive, Nobuyuki Idei, said he wanted Europe to account for 33 percent of Sony’s overall sales within three years, compared with 22 percent now.
Sony is holding its annual product demonstration in Europe for the first time to bolster its image in the region. Among the new gadgets it is introducing are a new model in the Clie line of hand- held computers, with Bluetooth and Wi-Fi technologies, and an upgraded version of Aibo, its doglike robot toy, with more emotions.
Source: International Herald Tribune