Dutch Company Launches Music Download Site
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Aug 11, 11:47 AM (ET)
THE HAGUE, Netherlands (AP) - Hoping to keep up with Apple's iTunes digital music downloading service in Europe, a Dutch record company has launched a Web site offering 250,000 tracks from five major record labels.
Free Record Shop Holding NV, which traditionally sells music, films and games at retail stores around northwest Europe, put Dutch and French-language Web sites online Tuesday as part of the new Internet service.
The sites got more than 500,000 hits in the first 24 hours, beating previous weekly records for all the company's sites together, said Olaf Zwijnenburg, who is overseeing the introduction.
"We went live yesterday and our visitor records were almost immediately smashed," he said in an interview. "We expect that after years of declines, music sales are on a comeback. About 5-10 percent of the market is going to be in downloads."
The service will compete with popular licensed music download services such as iTunes. Its competitors will not have the legal rights to sell the same selection being offered by the Free Record Shop in the Netherlands, Belgium and Luxembourg.
The new service will also have to compete with file-sharing programs, which hundreds of millions of people use to share copyrighted music for free over the Internet - a practice being fought in courts by the music industry.
Later this year, Free Record Shop plans to offer the download services in Finnish and Norwegian and will expand its digital music selection to 500,000 tracks, Zwijnenburg said.
"We differ from Apple's iTunes in that we offer both physical (compact discs) and digital music. We also have a selection of local artists which Apple doesn't have and that gives us a unique market position," he said.
So far, users can purchase downloads from the Web sites freedownloadshop.nl or freedownloadshop.be. Costs can range from euro0.89 (US$1.09) for a single song to euro22 (US$26.80) for a popular new double album.
The service was delayed by more than four years of negotiations with five major record labels - Sony, EMI, Universal, BMG and Warner - that own the rights to music the company is selling. The bulk of the profits from the online sales will go to them, Zwijnenburg said.
Most of the tracks initially offered on the sites are hit singles and albums, but the selection will later be expanded to include independent record labels, Free Record Shop said.
Free Record Shop Holding is a privately held company with 1,200 employees and 350 stores in Europe. It booked sales of more than euro350 million (US$440 million) in its split 2002-2003 book year.
