Tue, Oct 17, 2006 - Page 12 News List

Kuro teams up with Yahoo-Kimo music

SWEET MUSIC The two online music providers have teamed up to start a download service after Kuro was ordered last year to go legal by the Taiwan District Court

By Jason Tan  /  STAFF REPORTER

Kuro, the nation's largest online music portal, yesterday said it may merge with smaller rival Yahoo-Kimo Music.

"We don't rule out the possibility of further consolidation between the two portals," said Victor Chen (陳國雄), general manager of Chuang Lien Wang (創聯網), which operates Kuro.

He made the remarks on the sidelines of a press conference yesterday announcing a strategic partnership between the two music stores.

The top management of Kuro -- which used to offer an illegal peer-to-peer (P2P) music download service -- was found guilty of violating intellectual property rights by the Taipei District Court in September last year.

Three of its executives were sentenced to up to three years in jail and fined NT$3 million (US$90,416) each.

But Kuro, which has 400,000 members, settled the case with the International Federation of the Phonographic Industry (IFPI) in Taiwan on Sept. 14, by compensating the latter with the handsome sum of NT$380 million.

The deal demanded Kuro scrap its P2P platform and offer legal services within a month. The short deadline prompted it to temporarily switch its music-download platform to Yahoo-Kimo Music.

Starting yesterday, the first 100,000 Kuro members that register with Yahoo-Kimo Music will be able to download 10 songs free of charge.

Each song will cost NT$35 and a total of NT$35 million will be shouldered by Kuro, according to Chen.

Launched in mid March, Yahoo-Kimo Music acquired authorization from most record labels, and boasts an archive of 500,000 songs -- the most titles of all online operators, he said.

However, the heavy royalties have burdened Yahoo-Kimo Music, whose disappointing membership figures so far may discourage it from extending its royalty contract beyond next year, the Chinese-language Commercial Times reported yesterday.

The strategic alliance will thus alleviate the burden, with operator Yahoo-Kimo Inc (雅虎奇摩) even considering buying a stake in Chuang Lien Wang, the paper said.

While concrete plans for further collaborations are yet to be fleshed out, Kuro has plans to unveil more hardware products, such as MP3 players and speakers, said Eric Cheng (鄭期成), Chuang Lien Wang's chairman.

The company has strong support from C-Media Electronics Inc (驊訊電子), a leading computer audio product maker that gained a majority stake in Kuro last month.

The move will combine their ad-vantages in software and hardware to replicate another success story in the Greater China region, Apple Computer Inc's iPod MP3 players and iTunes online music store.

"We are not competing with other rivals here," Cheng said, referring to KKBOX and Ezpeer+. "Our real enemy is rampant illegal downloading of music."

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