traditional retail outlets) and consumers had little choice in selecting which record label to patronize since artists were signed to exclusive arrangements.
Today, the music industry is facing challenges similar to its earliest days. New technology (downloaded and streaming audio) is available which make it possible for the same performance (track on a CD) to be distributed over the Internet without involving the record companies at all. In addition, CD writing technology makes it possible for individuals to create custom CDs containing only the songs that the listener wants. While consumers have long had the ability to record copies of music they owned for the personal use (such as making a cassette copy of a CD for use in a car stereo), they were prohibited by law from distributing those copies to anyone else. Now, high quality copies can be distributed at little or no cost with no control exercised by the record labels or music publishers. Just as sheet music publishers watched their revenues contract to a very small percentage of record/CD sales, so today's music industry giants are confronted with technology that may well render the current industry structure obsolete (Porter, 2001).
2. The least likely scenario for the industry future is that record companies will be able to prevent the unauthorized distribution of music files on the Internet. Technology is advancing rapidly to the point where it is easy to e-mail files back and forth, let alone participate in highly complex systems such as Napster or Scour (Meier, 2000).
The industry has set about trying to create a secure file type that would prevent unauthorized copying, but there are several problems with this approach. First of all, such a technique does not address the billions of CDs that are already in the marketplace and which have no such encryption. Thus consumers could continue to trade
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