The crux of the problem for recording companies is that they sell music in its physical form, while MP3 permits music s distribution in a non-physical form. First conceived of as a means of allowing independent bands and musicians to post their music online where it might attract a following, MP3 became a headache for the recording industry when music from the name artists they controlled began appearing on MP3 sites, making piracy, the illegal recording and sale of copyrighted material, of high quality recordings a relatively simple task. Not only could users listen to their downloaded music from their hard drives, but they could make their own CDs from MP3 files and play those discs wherever and whenever they wished. Matters were made even worse for the recording companies when manufacturers such as Diamond Multimedia introduced portable MP3 players, freeing downloaded music even from users computers. July of 1999 the RIAA announced final approval of SDMI software containing screening technology.
Users can then transfer the audio to CDs or listen on their computers.
Sony Music was the first of the major recording companies to distribute its music in a purely digital form. In Sony s view, it benefits convenient, affordable downloading might limit some online piracy. Both DOD and Sony argue that most if not all of the big labels will have to join them for digital delivery of recorded music to become successful. They began the service unilaterally because, they reasoned, somebody had to make the leap of faith. Many observers, however, feel that the recording industry may be too late in entering the online music field to effectively shape its development.