The portable digital music player stores music files on tiny memory cards  ALSO: Part 1: MP3 technology rocking the music world MP3 index special INTERACTIVE: Would you consider the purchase of a portable MP3 player? Yes No View Results RELATED VIDEO CNN's Rick Lockridge reports on MP3 software squeezing songs into just one-tenth their original size. Real 28K 80K Windows Media 28K 80K

March 2, 1999
Web posted at: 11:17 p.m. EST (0417 GMT)

NEW YORK (CNN) -- New music technology is changing the way you can buy, carry and listen to your favorite songs, much to the despair of the recording industry.

Computer users have been able to download and play thousands of songs, many free of charge, thanks to new digital technology called MP3.

MP3 software squeezes songs that are normally too big to move around the Internet into files just one-tenth their original size.

Fast on the heels of MP3 is the arrival of the portable digital music player, which stores those music files on tiny memory cards and plays them back.

The portable players can be carried anywhere and hold about an hour's worth of music, which can be changed as often as the listener desires.

"This is the beginning of something that will dramatically change the way people will listen to music," said Ken Wirt of Diamond Multimedia, which makes a device called the RIO.

But only some of the tunes that make their way to a RIO player are legal. Many Web sites offer songs without copyright permission, posing a major threat to record labels and performers.

The chances are slim, for instance, that Madonna is giving away songs from her recent Grammy-winning album.

Unable to contain the explosion of legal Web sites such as MP3.com, the record companies sued Diamond Multimedia last October in a bid to keep its RIO player off the market.

"The problem we had with the RIO was that it could exacerbate the MP3 piracy problem by encouraging more people to post illegal MP3 files and more people to download them," said Cary Sherman of the Recording Industry Association of America.

Diamond Multimedia won the first round of the lawsuit and now sells about 20,000 RIOs a month. Most digital players like the RIO and the rival MP3Man cost an average of $150-$200. Prices are expected to drop as more competitors enter the market.

"I'm sure there were some people captivated by the thought, 'Well the record industry doesn't want me to have this, I better check it out,'" Wirt said.

Correspondent Rick Lockridge contributed to this report.

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