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stay ahead whilst new entrants are able to exploit the economics of
the Internet. At the heart of the change is the potential for
creating, storing and distributing music in digital format – a problem
which many researchers have worked on for some time. One solution,
developed by one of the Fraunhofer Institutes in Germany, is a
standard based on the Motion Picture Experts Group (MPEG) level 3
protocol – MP3. MP3 offers a powerful algorithm for managing one
of the big problems in transmitting music files – that of compression.
Normal audio files cover a wide range of frequencies and are thus
very large and not suitable for fast transfer across the Internet –
especially with a population who may only be using relatively slow
modems. With MP3 effective compression is achieved by cutting out
those frequencies which the human ear cannot detect – with the result
that the files to be transferred are much smaller.
As a result MP3 files can be moved across the Internet quickly and
shared widely. Various programs exist for transferring normal audio
files and inputs – such as CDs – into MP3 and back again.
What does this mean for the music business? In the first instance
aspiring musicians no longer need to depend on being picked up by
A&R staff from major companies who can bear the costs of recording
and production of a physical CD. Instead they can use home recording
software and either produce a CD themselves or else go straight to
MP3 – and then distribute the product globally via newsgroups,
chatrooms, etc. In the process they effectively create a parallel and
much more direct music industry which leaves existing players and
artists on the sidelines.
Such changes are not necessarily threatening. For many people the
lowering of entry barriers has opened up the possibility of
participating in the music business – for example, by making and
sharing music without the complexities and costs of a formal
recording contract and the resources of a major record company.
There is also scope for innovation around the periphery – for example
in the music publishing sector where sheet music and lyrics are also
susceptible to lowering of barriers through the application of digital
technology. Journalism and related activities become increasingly
open – now music reviews and other forms of commentary become
possible via specialist user groups and channels on the Web whereas