ABSTRACT
Digital file format and online music distributor. Launched in May of 1996, the Liquid Audio venture recruited computer-music veterans from Stanford University, audio manufacturer Ampex, and the Grateful Dead. Based on the idea that the imminent digitalmusic revolution would be nothing without legally licensed content and corresponding delivery technology that protected against online bootlegging, Liquid Audio provided record labels and artists a means of distributing music electronically without rampant loss of revenue. Perhaps surprisingly, the company’s insistence on copy protection did not successfully attract the participation of major labels, which are involved in proprietary online distribution methods. Music retailers sometimes have been more threatened by Liquid Audio’s distribution model than the labels, and Capitol Records withdrew its plan to prerelease a Duran Duran single in “Liquid” format after a threatened retailer boycott of the CD. Liquid Audio failed to become a standard for such distribution, and in 2002 the service went bankrupt. In early 2003, Anderson Merchandisers, a wholesaler of major-label recordings that services Wal-Mart and other retailers, purchased Liquid Audio’s assets, with the support of the Universal Music Group. They hope to revive the format as a means of delivering audio files to consumers and to retailers.
