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Music Retailers Shelve Plan for Digital Song Store Joint Venture

Authored by Mark Hefflinger on June 16, 2004 - 9:44am.
San Francisco -- A consortium of music retailers including Best Buy, Virgin, Tower Records and Borders have decided to cut funding for a plan, announced in early 2003, to create an online store joint venture to sell digital music -- citing high development costs and the low profit margins of existing services like iTunes, CNET News.com reported. The "Echo" project was started in 2001 by a former executive of Internet radio service Echo Networks and a consultant whose father had ties with the music retail industry that enabled them to eventually win the support of major retailers. "The reality is that compared to all the retailers' bottom lines, even Apple's music sales are insignificant," Alex Bernstein, a co-founder and investor in the Echo project, told News.com. "Our board repeatedly told us that… It ultimately boiled down to the idea that the numbers didn't justify a large investment at this stage in the market."
tags: Music | Deal | Digital Song Store | Music Retailers |