Music Choice Uploads Bowie CD

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Multiplatform digital-audio service Music Choice wrapped up
a two-week offer last week allowing its Web-site visitors to purchase a full-length
compact disc of David Bowie's new hours album via music download.

Music Choice plugged the offer as the first full CD
download available from a major recording artist.

The offer expired last Monday night just before midnight,
when the album became available for retail sale. Music Choice was one of more than 50
online retail-music sites testing sales of the download with Bowie's record label,
Virgin Records America.

The suggested retail price for the test was $17.98 per
album download, including a bonus song, "No One Calls," which is not found on
the CD at retail. Music Choice charged its subscribers $12.99 for the download.

Music Choice has about 10 million digital-cable and
direct-broadcast satellite subscribers, which still drive the majority of new traffic to
its Web site, president Dave Del Beccaro said.

DirecTV Inc. helped to spread the word about the Bowie
download through a customer e-mail, and cable-modem service Road Runner promoted the
download on its Web page.

Music downloads give Road Runner "a way to prove to
their customer base why they need high speed," Del Beccaro said. He added that he was
able to download the Bowie album in less than 10 minutes using a high-speed connection,
but the process could take two hours or more using a 28.8-kilobit-per-second dial-up
modem.

Music Choice will continue selling CDs via music downloads.
Last week, the company announced that it began selling albums by unsigned artist Kathy
Fisher and acoustic band Naked to the World on its Web site.

In the future, Music Choice plans to cross-promote artists
between its cable channels and its Web site, using showcase channels to drive cable and
DBS subscribers to the Internet. Some of the music downloads available on the Web will be
free, value-added offers created especially for customers of Music Choice cable or DBS
affiliates.

Citing a nondisclosure agreement, Del Beccaro could not
release buy-rates for the Bowie download. But he did say the record label did better than
it had predicted.

Music downloads are still in their infancy. "Most
people don't even know what a download can be," Del Beccaro said, adding that
the portable equipment allowing consumers to download music and carry it with them from
their PC to their car -- or wherever they prefer to listen -- is just starting to become
available at consumer-electronics stores.

Del Beccaro believes convergence will help to drive music
download sales, and digital cable and DBS will do better than traditional Internet sites
because of their high speed and bandwidth.

Music Choice can help to drive sales of music downloads for
its affiliates by creating an environment where customers regularly go to listen to music.

"If you believe that in the future, people will
consume music as they listen to it, we're uniquely positioned going forward,"
Del Beccaro said.

As convergence and electronic commerce become a larger
focus for the company, Music Choice plans to share revenues from transactions such as
music downloads with its cable and DBS affiliates.

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