July 15, 2004 7:20 AM PDT
eBay plugs into digital-music market
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The San Jose, Calif.-based company outlined the details of the 180-day pilot program on a page posted to its corporate site. On that page, the company places an emphasis on its desire to foster sales of digital content while remaining within the bounds of copyright regulations. eBay did not specify how many individuals would be allowed to sell music in the test but said it will evaluate the program after six months to determine whether a group of preapproved download vendors are adhering to copyright laws.
The surprise move by eBay into the promising digital-download sector follows this week's news that Apple Computer's market-leading iTunes service has crested 100 million transactions. Other big-name vendors are also rushing to establish themselves in the space, including entertainment giant Sony, which, like Apple, offers both digital-content downloads and the devices used to play the files.
The strategy represents a significant departure from eBay's historic policy of banning sales of digital music files, a provision long included its listing policies.
The company said individuals or companies approved to sell music through the new "Digital Downloads" site category will first have to prove to eBay that they have clear rights to market any content being made available for auction.
Under the pilot, eBay said the actual transaction between buyer and seller will be executed on a Web page controlled by the download vendor, which will be co-branded by eBay. The company specifically stated that individuals buying music would not be allowed to relist or resell any content they purchase through its auctions.
In light of the many schemes being hatched by hackers that use the eBay name illegally, the auctioneer is already warning its customers not to get sucked in by any unsolicited e-mails or pop-up ads offering music download auctions over its pages. The company also said it will test and monitor music vendors' transaction sites to ensure that sellers are sufficiently protecting customer information.
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