Sony Music Entertainment (Japan) Inc. (SME) has begun selling a "LabelGate CD" that incorporates a mechanism to allow copying of its music contents to a hard disc drive in a PC. LabelGate CD will cover all the titles of single CDs the size of 12cm containing domestic music pieces to be released on or after Jan. 22, 2003.

"In a questionnaire we conducted among consumers, when asked 'how do you listen to CDs?,' more than 60 percent answered they use a PC to listen to music. We feel such consumer behavior should not be ignored," an SME source said.

Since the spring of 2002, major record companies have introduced Copy Control CD (CCCD), which is targeted to stop at its source the illegal copying of music contents. CCCD contains two sessions (a session means a set of data): a session that controls reading by a CD-ROM device in a PC, and a session to be played on a PC. Even for the session to be played on the PC, copying of contents to the HDD is not allowed. With a normal CCCD, users can't manage music titles on their HDD like a jukebox.

While LabelGate CDs have two sessions as a CCCD does, what makes a LabelGate CD and CCCD different is that the LabelGate CD allows a session originally for play on a PC to be also copied onto the HDD. This session is encrypted and cannot be decoded without the user obtaining a key data through the Internet.

The key data can be downloaded as follows. When the user inserts LabelGate CD into his or her PC, the PC automatically visits the server controlled by SME. Then the server recognizes unique numbers called "Postscribed ID (PID)" allotted to each of the LabelGate CDs, and sends back the key data. This key data will then allow the music contents to be copied onto the HDD. As the combination of the key data and the corresponding PID is controlled by the server, the same key data cannot be used for decoding of another LabelGate CD's contents. SME also offers a backup system of music contents in case of a HDD crash.

When the user copies a LabelGate CD for the first time, the key data can be provided for free. For the second time and thereafter, there will be a fee of 200 yen per song. "We set the same price as our music distribution service called 'bitmusic,'" said SME. The charge is billed per package, not per song. For example, to copy a LabelGate CD with four songs, 800 yen will be charged for one-time copying.

However, this mechanism has a problem in that a user with more than one PC must pay a charge for another round of copy onto the second PC and so on. SME said, "We don't think the current system satisfies all users."