William von Meister, a local telecommunications inventor and entrepreneur, has formed a new company here, Digital Music Co., and hopes to make millions by selling programmed music to cable TV subscribers. The music is to be transmitted by satellite, and, according to von Meister, will provide listening quality superior to regular record albums and pre-recorded tapes.
And that's the rub: Independent industry analysts have contended that the success of von Meister's $20 million gamble rests with his ability to gain acceptance from the recorded music industry. To deliver the quality he's promising, von Meister needs access to master recordings owned by music companies. So far, he has been able to obtain informal "agreements" from four as-yet-unidentified music firms.
Home Music Store, as it's been dubbed, will use the Westar IV satellite. Music encoded "digitally" by computer in Los Angeles, is bounced off the satellite to member cable TV stations, and transmitted into the homes of subscribers who pay a monthly fee of $6.95 to $9.95. Each subscriber will receive an electronic decoder which reassembles the impulses, producing studio-quality sound.
The transmission of music touted as better than records poses several problems for the music industry -- copyright violations, market diversion and increased competition. But von Meister has offered to share revenues with cooperating cable TV stations and recording studios, and is investigating safeguards against record piracy.
Home Music Store will feature five channels of programming for listening, two for tape recording, and a channel for previewing music available for recording. Subscribers, armed with personal account numbers and a toll-free telephone number, will call HMS in Los Angeles, specifying a selection code that queues up the music chosen for taping. Subscribers are then billed for the selections taped, at a cost about 20 percent to 60 percent off the list price of the album. Users interested in just listening pay only the monthly service charge.