"...First, the major label groups attempted to thwart online music piracy by going after such file-swapping companies as Napster and Scour. Now, they've turned their attention to what they believe is one source for leaking their products -- journalists. Universal Music Group's Universal Records and Warner Music Group's Reprise Records are experimenting with digital watermarking technology to track pre-release albums sent months before their commercial street dates to thousands of music journalists and radio stations for review purposes.
Through watermarking, codes embedded in album tracks correlate to a number the label has assigned a CD. If the recipient of that CD converts the tracks into MP3 files and posts them on the Web, the watermark allows label watchdogs to ascertain the origin of the illegal file. Additionally, Universal and Reprise have begun to stamp journalists' names on selected pre-releases. A code embedded in Universal CDs corresponds to the recipient's name. This method was used recently for the pre-release of the label's Godsmack album "Awake," which was sent to journalists with their name stamped on the CD and a blunt letter of explanation.
The letter, on UMG letterhead, warns that if the recipient uses the album in an "unauthorized manner," the label will use the watermark "to match the misappropriated sound records to the record they were originally embodied on, identify the recipient of that particular record and take the appropriate action.". Now in a trial period, UMG has watermarked albums from such high-profile groups as Godsmack, 3 Doors Down, Boyz II Men and 98¼.
Advance copies of Reprise's Green Day CD "Warning" had journalists' names stamped on them, but Reprise's watermarking is in an earlier trial phase than the UMG initiative and cannot trace MP3 files to a specific journalist. The watermark number correlates only to the label department -- promotions, corporate, radio or A&R -- to which the advance copy was issued, a WMG spokesman said.
"If the (album) shows up on Napster, it's easy to detect the number, and we just might give a call to the person and say, 'Your copy got on Napster. How did that happen?' " Kenswil said. "It's not necessarily that the person is doing it themselves, but if they review it, they might give it to a friend or sell it to a used-CD store.".."