Sorting Through the Static

Can Apple remain king of the digital-music mountain? Find out in this rundown of the latest downloading and playing options.
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The Sony PSP

Photo: sony.com

From

Apple's

(AAPL) - Get Report

record-selling iPod to

Sony's

(SNE) - Get Report

PSP to countless other (read: cheaper) MP3 players, there's a lot for music lovers to choose from.

To fill all those devices, there are also multiple options for digital downloading. Quite often, though, figuring out the compatibility and restriction issues is enough to make your head spin.

In order to make sense of it all, here's a profile and history of each major industry player.

This will help sort out which on-the-go music player, as well as which download service, is best for you.

Apple's Core

Apple has turned its iTunes application into a worldwide brand.

"The reason Apple dominates computer music today is because of a huge investment at the turn of the decade," says long-time music industry analyst

Bob Lefsetz. "Valuable companies are not about getting paid today, but long-term strategy."

With the convenience of the iTunes Store's one-click downloads for music, full-length videos and TV shows, the company has cemented itself as the early leader in the legal Internet downloading realm.

This success is even up against subscription-based models, including

Napster

(NAPS)

,

RealNetworks'

(RNWK) - Get Report

Rhapsody and eMusic.com.

Lefsetz points out that instead of the early Napster clones for pirating music, "we've got RIAA

Recording Industry of America-endorsed music sites," but that each fails to "deliver what the consumer wants."

Indeed, there is some stiff competition on the horizon for Apple.

SpiralFrog, touting itself as the digital-entertainment destination, will offer ad-supported legal downloads of audio and video content when its Web site debuts in December.

With Universal Music Group set to back SpiralFrog by offering its extensive music catalog on the site, the upstart company may have what it takes to take a bite out of Apple.

"The initial reaction has been interesting," says Robin Kent, CEO of SpiralFrog. "I was quite pleased with the misconceptions people have about SpiralFrog. I think that's great."

Those misconceptions have been raised before the site has even opened, with wild assumptions about download file types, compatibility issues and exactly what hoops visitors will have to jump through in order to download music and video files.

The SpiralFrog Leap

With the launch still a few months away, Kent doesn't want to reveal too much about how the SpiralFrog site will run. He volunteers that the advertisements "won't be obtrusive.

But we obviously make the user go through a little bit of pain to generate advertising revenue."

"People won't come just to download songs," says Kent. "They'll get information on artist biographies, concert footage, music news, as well as the

the ability to download music for free."

A free download in exchange for viewing a brief advertisement may sound too good to be true. Some think that SpiralFrog's model is doomed to fail.

"Rental -- and make no mistake, SpiralFrog is rental -- is just that you pay for it with your eyeballs and time as opposed to cash," says Lefsetz. "It has been proven to be a failure. Napster's going out of business and Rhapsody is a niche product.

"Look at all the high-class companies, from BMW to Louis Vuitton, who guard their images so preciously. The music business is willing to tie its wares up with anybody who's willing to pay," Lefsetz continues.

Cracking Compatibility

In addition, users will have to understand the limits of the files they download. Kent notes that in order to get major labels to sign on, SpiralFrog has to offer digital-rights-management (DRM) protected files.

DRM-protected files can be bothersome, even if a listener isn't sharing the music illegally. The embedded code prevents users from uploading to multiple music players. In addition, the DRM protection can limit the number of times the file is burned to a CD-R, if burning is possible at all.

So what exactly does that mean for downloaders and their iPods?

"We're using the WMA

Windows media audio file type, so we're not compatible with the iPod, and we won't allow them to be burned to CD at all," says Kent. "We're more interested in the cell-phone technologies, with

Motorola

(MOT)

and

Nokia

(NOK) - Get Report

. We see that as the future."

"As more and more music is digitized, the desire to burn a CD and pass it along will lessen," Kent says. "Plus, you can always just point friends to SpiralFrog to get a song themselves."

Kent expects that iPod users will still come to SpiralFrog's site, banking on the idea that most music listening and video viewing is done at home, not through portable devices.

Kent also forces the point that SpiralFrog's ambition "is to get people to move away from illegal pirate sites. For those people that won't purchase, I think it's not much of a price to pay."

The recent introduction of

Microsoft's

(MSFT) - Get Report

Zune ($250; 30 GB) portable media player adds yet another piece into the problematic equation for overwhelmed shoppers.

The Zune's online marketplace, similar to iTunes', will feature 99-cent downloads, as well as monthly subscriptions, which allow for unlimited downloads. The downloaded files will be WMA files, much like SpiralFrog's service, and will be incompatible with Apple computers and, more importantly, with iPods.

But with Apple the reigning superpower of music and video on-the-go, which option is the best pick?

"I know that Microsoft pushes WMA files, but if you think Microsoft always wins, you've never heard of Google," argues Lefsetz.

"WMA is not the music standard. It's incompatible with iPods. But worse, it's Mac-incompatible. And Macs are big on campus," Lefsetz continues.

Synching It All Up

Your iTunes purchases can only go on your iPod, while your Zune purchases and SpiralFrog downloads can only be played on your Zune.

Which should you use?

It boils down to personal preference: Do you prefer the ease of use with the iTunes Store?

Its registration is simple and purchases are only one click of a mouse away, not to mention that the iPod is the most popular and widely recognized player.

SpiralFrog is almost as easy to use, however, and won't require a credit card for access -- reassuring those who are afraid of Internet identity theft.

"The first time you get a song, you give us some general information so we know you're real," explains Kent.

"There will be a bit of a desktop application, which you never have to see while downloading. It's so easy to use and navigate," Kent continues.

Not surprisingly, Lefsetz isn't as optimistic.

"If you think SpiralFrog and Universal and Microsoft are going to conspire to defeat Apple, then you probably drive a Yugo," he says.

Industry Standard: Apple's iPod

Photo: apple.com

Personally, I've been the proud owner of an iPod since I moved to New York City a few years ago, and I can't imagine my commute without one.

For now, I'm content with my new video iPod ($250; 30 GB), as it covers all my digital-media needs.

And as a Mac computer user, it would be a difficult and costly transition to either the Zune or SpiralFrog's services.

However, with CD prices escalating and online music technology burgeoning, SpiralFrog's free downloads may cause a reassessment of my position the next time my iPod battery dies and I'm faced with shelling out a couple of hundred dollars for a replacement.

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