ONLINE – Want Tunes on Your Site? Try WWW.com

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Imagine Latin music playing over a Mexican-food catering company’s Web site, or animal-themed tunes on a site selling personalized pet gifts.

That’s one of the offerings from Santa Monica- and Irvine-based WWW.com, an Internet firm that first attracted headlines in 1998 when it paid in the seven figures for its basic but hard-to-forget domain name.

WWW.com is an online broadcaster offering tunes and other entertainment from 200 online radio stations, in addition to a more-unusual feature targeted at businesses: It will create an audio component for Web sites geared to the site’s target audience, so users can listen to music while they’re on the Internet.

That service is the way WWW.com wants to differentiate itself from other Internet radio sites like VH1 AtWork (which streams music played on the VH1 cable television station), LouisianaRadio, Crosswalk.com and Billboard.com.

It’s a new focus for a company that launched in June as a site where users could log on to hear a diverse range of musical genres. The company’s Santa Monica music executives noticed late last year that browsing the Internet was a fairly silent experience, to the detriment of online businesses.

Mood music

“Music has certain effect on people. It’s much like when you go to a mall and go into the Gap, you kind of tune into the music while you’re shopping,” said Michael Romano, vice president of marketing for WWW.com. “It gets you in a pleasant mood, gets you in the store a little longer, gets you to spend a little more, and gets you to come back, whether you know it or not.”

Since the beginning of the year, 50 companies have signed up for the service, 30 more than WWW.com officials projected.

Companies that place an audio stream from WWW.com on their Web sites get a music tuner that pops up in a small box when a user signs on. The user can then surf the Web and keep the music playing by simply keeping the box open; clicking on the box will take the user back to the company’s Web site.

Following an ad campaign last fall, as well as all the free media attention it got after buying its domain name, WWW.com has had no shortage of customer traffic. PC Data ranked it the second most popular online radio site, with more than 1.46 million unique users in January, up from 978,000 in December. It was beaten only by Broadcast.com, Yahoo Inc.’s multi-purpose broadcast site offering streaming audio and video, chat rooms, and other features.

Unlike most Internet companies, WWW.com projects profitability this year, because of a diverse revenue stream combining banner ads, sponsorship logo space, a streaming fee for business-to-business clients, a small but additional payment from selected advertising on clients’ sites, and the potential for audio ads during the radio broadcasts.

Because Internet radio streams music, which is more difficult to pirate than downloaded music, some sites have sealed deals with record labels to stream popular artists’ tunes, much the way radio stations do. Federal law requires a license for streamed music.

Licensing arrangements

Record labels can grant licenses, and a statutory license can be automatically granted to netcasters fitting particular standards. A standard fee for the statutory license has not yet been determined, so netcasters must negotiate with the Recording Industry Association of America, which is representing the major labels in such discussions. Many of these negotiations have disintegrated due to disputes over the fee, leaving several potential deals in arbitration.

WWW.com has been able to beat a host of other Internet broadcasters by sealing license deals early on with the industry’s major record labels. It has also signed a deal with the RIAA to pay artist royalties.

“It’s not that you have to do that, but they’ve chosen to operate in the bounds of the existing structure of the record industry,” said Michael Leventhal, music attorney at Squandron, Ellenoff, Plesent & Shienfeld LLP.

“It’s a win-win situation,” Romano said. “We’re getting the music we need to be able to broadcast, and they are getting the licensing and e-commerce capabilities” through a link to Amazon.com that allows WWW.com users to buy the CDs of the artists being played.

But the question for all netcasters lingers: Are battles over licensing and potential for financial failure worth it, considering the relatively small number of Internet radio listeners?

To access an online radio broadcast, a potential listener needs a computer with at least a 28.8 modem, a sound card and speakers. If the computer does not come equipped with a “player,” which allows the music to be played in the computer’s system, the top two players, RealPlayer and Windows Media Player, can be downloaded free off the Internet.

“I don’t think it’s a tech question in the long run. In the short run it is,” Leventhal said. “As much as everyone likes to tell you sound quality can be great at 56K, you can have problems. As for the equipment you’ve got, most everyone can accept those kinds of streams, but most don’t have a good-quality speaker system or sound card to enable you to listen to CD-quality music. These things are all temporary.”

Leventhal and others envision a not-too-distant future of fast broadband or cable connections allowing all entertainment media, from radio to television to online video, to stream signals through a computer. Even before that Brave New World arrives, faster connections, larger computer memory, and enhanced computer sound systems will become standard, they said.

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