Digital Music Sales Surge As CDs Continue to Slide
Album sales have continued their downward slide this year but sales of digital tracks are up almost 50% over this time last year. A total of 229.8 million albums were sold in the U.S. between Jan. 1 and July 1, according to Nielsen SoundScan figures. That's a 15% decrease over the same period last year. Meanwhile digital tracks sales increased 49% to 417.3 million this year. The decrease in album sales becomes only 9.2% when digital singles are bundled together and counted as albums. Television continues to sell music. Former American Idol finalist Chris Daughtry's album "Daughtry" has proved to be the most popular this year, selling 1.7 million copies so far. A song from that album, "It's Not Over," is the sixth most popular digital track. Last year's top-selling album was a soundtrack inspired by the Disney Channel movie "High School Musical." It had sold more than 3.7 million copies by December 31. The other most popular albums this year include Norah Jones' "Not Too Late," Akon's "Konvicted" and Linkin Park's "Minutes to Midnight." The trend away from albums and toward digital tracks has been going on for a few years, with industry insiders saying it is fueled by pop music's emphasis on hit singles. Consumers simply buy the songs they want and skip the albums. Carrie Underwood, another "American Idol" alumnus, has the top-selling country album and the fifth best-selling album overall with 1.1 million copies of "Some Hearts" sold. Gwen Stefani's "Sweet Escape" is the most popular digital track this year, selling 1.8 million so far. The next closest seller is "Cupid's Chokehold" by Gym Class Heroes followed by Maroon 5's "Makes Me Wonder" and Fall Out Boy's "This Ain't a Scene, It's an Arms Race."

MPAA sets up P2P sites
Rather than stopping P2P sites in their tracks, the Motion Picture Association of America has decided to set up a few of its own. However, the sites have been built by the MPAA outfit Media Defender as honeypots in a bid to entrap P2P users. Once a person has logged onto one of the sites, the MPAA records the sharers IP address and then sues them into a coma for a huge wodge of cash. One site has been identified as MiiVi.com. It has a user registration, forum, and "family filter", offers complete downloads of movies and "fast and easy video downloading all in one great site." The site offers software which it claims is to speed up downloading process. However it actually searches your computer for other copyrighted files and reports back to the MPAA laywers. According to tech.blorge, MiiVi is registered to Media Defender according to a whois search. A magazine called ZeroPaid discovered the link and shortly afterwards the registrar information was changed. However the address was still that of MediaDefender. Later the site was down and it is possible that Media Defender pulled the plug on the operation. Anyone caught by such a site would have a fair bit of law on their side. The United States has a lot of case law against entrapment although the MPAA might just be hoping that most people will settle out of court.

Social networking doesn't influence online shopping
Social networking sites are not generating significant online retail sales for companies looking to exploit the growing phenomenon. The networking sites have little influence on where people go to shop online. Only 12% of online shoppers quizzed said they buy more than planned as a result of using a social networking site. Findings show 53% of online shoppers go straight to the site they want to buy from, rather than being directed there by a social network site. Just 3% said they use blogs as a route to online shops. Shoppers are looking for fundamental information when researching products online - rather than entertainment or social interaction. Despite the attention on social networking from a branding and advertising perspective, sites simply don't offer the convenience and efficiency of retail sites. There is a tendency for organisations to gravitate towards the latest way of "getting noticed" without knowing whether the approach will work. Retailers would do better to evaluate what is effective to make a stronger impact, rather than just following a trend. Social networking sites serve to reaffirm purchasing decisions, with 29% of respondents saying they make better decisions using them.

Cable firms to raise set-top box rates
Cable companies are planning to charge more for set-top boxes to help pay for new, more expensive versions mandated by the FCC. They say the price increases are a result of the government's push to spur competition for the boxes, which are required to receive digital programming and change channels. It's not yet clear how much the charges will rise. The FCC has been trying for nearly a decade to open up the set-top market so subscribers actually buy their own and then use a cable-company-provided card to decode their programming. The retail market for the boxes, however, has largely failed to materialize and millions of consumers still rent the boxes from their cable company. As of July 1, cable companies were required by the FCC to start shipping the new set-top boxes with detachable cable cards. The companies have lobbied against the rule, saying the new boxes are more expensive. Consumer groups say it's yet another excuse for cable companies to raise rates. And higher rates are definitely coming. Cable industry officials said even consumers using the older set-tops will likely be hit if the cable company decides to spread the cost to all box renters. Cable operators won't yet say exactly how much more consumers will pay to rent set-top boxes. It's also unclear whether the fee increases will apply to cable cards. Both cable trade groups have said consumers would see $2 to $3 more in monthly rental rates for the new boxes, but that doesn't take into account spreading the cost out to all box-renters. Comcast, the nation's largest cable operator with 24 million video subscribers, is planning to spread out the cost of the new boxes among all cable box renters.

Google loses German Gmail
Google has been banned from using the name "Gmail" in Germany following a trademark case filed by the founder of G-Mail. A German court heard how Daniel Giersch started using the name G-Mail in 2000, four years before Google. The Court ruled that Giersch had properly registered the name and Google just took it without asking. The court said that the the legal situation was so unambiguous, Google would not be allowed to appeal. The trademark battle has dragged on for three years and has been fought in a number of jurisdictions. Google, remember "Do no evil"?, is suing Giersch in Spain, Portugal and Switzerland, until he he drops the legal claims lodged in Germany. So far a court in Switzerland threw out Google's case and now Giersch will file a suit to prohibit Google from using the name in that country. Giersch said that he has no intention of selling the name which he wants for his hybrid mail system.

BlackBerrys to sell in China
RIM has won permission to sell its BlackBerry device in China after eight years of effort. After several delays, the Canadian technology company won approval last month from the Chinese Ministry of Information Industry to sell its handsets. The company expects to start selling its 8700g handset in China at the end of next month. RIM has received nearly 5,000 advance orders for the device, mainly from corporate customers and notably foreign multinationals with offices in China. RIM is considering a plan to manufacture devices in China. The company, which currently sells BlackBerrys in India, Japan and South Korea, is flying high on its recent results and outlook, including a 76.5% jump in quarterly sales, and forecasts of strong subscriber growth.

Businesses beware upgrading to Vista, warns Dell
Dell has taken the unusual step — for a PC vendor of its size — of toning down its sales pitch for Microsoft's Vista operating system and warning businesses of the migration challenges that lie ahead for them. The step is particularly unusual because one of the issues the hardware vendor is warning business about is the extra hardware they will need to buy. Overall the challenges will be significant and "should not be underestimated". However, businesses should go ahead with the migration and not wait for Microsoft to release its first service pack. Last month, Microsoft passed 40 million sales of Vista, but most of those appear to be to consumers rather than businesses, which have been slow to upgrade.

High prices curb S.African Internet growth
The number of South Africans with Internet access will rise by just 3% in 2007 due to high tariffs, but stiffer competition in the broadband market will boost connectivity by 2010. About 3.85 million people -- just one in 12 South Africans -- were expected to have access to the Internet by the end of 2007, up from 3.73 million last year. The number of broadband users is expected to more than double by the end of this year as fixed-line monopoly Telkom cuts its prices and persuades existing dial-up customers to upgrade to high-speed services. The relatively high cost of renting and using a land line, however, means few new users can afford to sign up for a basic dial-up service. Businesses and the government say high tariffs for phone calls and Internet use are deterring investment in Africa's biggest economy and impeding the roll-out of communication services to the poor.

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