Amazon Listening Booth Challenges MP3, Audio 4.0

Music stores have had them for years, and book-music-video-coffee-and-scones stores like Borders have also caught on. They are listening booths, a popular new way to hook audio buyers. So it makes sense that Amazon.com, whose Internet everything store competes with Borders and Borders.com, would follow suit online.

Amazon (Nasdaq: AMZN) opened its new booth today at www.amazon.com/music-downloads, showcasing 20 artists whose newly released CDs are featured for sale this month. Taking regular listening booths one step further, Amazon lets visitors download the entire songs for replay on their computers anytime. In a store, the listener has to leave the song behind in the headphones bolted to the store wall. The only way to take the song home is to buy the disc or tape.

Included in the Amazon listening booth are backgrounders on the artists, interviews with them and information on their new releases. Amazon claims it is the first major online retailer to offer a listening booth. The retailer tested the plan by offering digital downloads from Sarah McLachlan in April and Public Enemy last month. Featured artists this month include Lyle Lovett, Cheap Trick and Cowboy Junkies.

Format Controversy Roars Again

There is a catch: Almost all of the songs available in the Amazon booth need Liquid Audio Inc.’s Liquid Player software to play them. The software can be downloaded free at the Liquid Audio Web site. With only a few titles also downloadable in MP3 format, Amazon’s decision to back Liquid Audio presents an interesting new twist to the growing MP3 vs. Microsoft Audio 4.0 battle.

As reported, MP3 has made much noise by offering its audio compression technology free to any Web site that wants to make music available for free, unencrypted download. Audio 4.0, meanwhile, has won the support the Capitol Records and Grand Royal Records labels. Launch.com has committed to Audio 4.0, while Tunes.com uses MP3.

Liquid Audio avoids the criticisms MP3’s free architecture has attracted by using a format the company says will protect artists’ copyrights and track royalties. Liquid Audio is based on an open architecture that supports all leading digital music formats, including Dolby AC3, MP3 and Microsoft’s Media Player. “This open architecture will also enable Liquid System products to be compliant with the goals of the Record Industry Association of America’s Secure Digital Music Initiative,” Liquid Audio says.