New disc format enters crowded market

? As if she weren’t ubiquitous enough, Britney Spears’ music will be available this summer on a new type of disc for small handheld players.

The discs look like CDs an inch across and are housed in plastic cartridges. They can store any kind of data, including video and software, and are attractive to the music industry because they are strong on copyright protection.

The new Dataplay storage disc, far left, is a fraction of the size of a standard CD. The Dataplay disc can store about 250 megabytes of data on each side, compared with 650 megabytes on the traditional CD. The engine at right is used to play and record data to the Dataplay disc.

While the format is novel, analysts say getting consumers to adopt it will be a tough sell for consumer electronics and record companies.

Dataplay Inc., the Boulder, Colo., company behind the technology, is counting on prerecorded discs and some weighty partnerships to get a foothold.

“We want to start with music to get overall format adoption,” Dataplay’s Todd Oseth said. “That’s how the CD became popular by getting people to buy prerecorded music.”

The company’s partners include big hardware companies Toshiba and Samsung, which plan to make players for the discs. Three big music companies BMG, Universal and EMI are going to put out music discs.

Dataplay also is making a strong play for the teen market. Independent music company Zomba Records will release discs featuring its roster of stars, including Britney Spears and ‘N Sync. One of the music players, made by Evolution Technologies Inc. of Raleigh, N.C., will be co-branded with MTV.

Dataplay incorporates safeguards to prevent songs sold on the discs from being copied to computers, a major plus for the music industry. Last week, a music industry group said worldwide sales of CDs fell 5 percent last year, the first drop ever. The group attributed it to the rise of Internet services like Napster, which distributes music copied from CDs.

“What the record labels like about Dataplay is that it’s a format they can control,” said analyst Phil Leigh at Raymond James Financial. “They would probably like to see all CDs go the way of the Dataplay.”

Even with music companies behind it, Dataplay faces a lot of competition as an audio format, and there are discouraging precedents.

Sony introduced the compact, rewritable Minidisc in 1992. While moderately popular in Japan and Europe, it has never caught on in the United States.

Two years ago, Iomega Corp. launched MP3 music players that used its Click discs but did not make much of a dent in the market.

The Dataplay discs are more versatile and have larger capacities and wider industry support than either predecessor. Consumers, however, are likely to prefer MP3 players that use memory chips rather than discs or portable CD players that also can play MP3s, according to Leigh.

And many consumers will resist the Dataplay format precisely because of the copyright protection that makes it so attractive to music labels.

“My general take is that it’s going to be a niche application,” Leigh said.

Blank discs costing $5 to $12 and music players, for $300 to $370, will hit stores at the end of May.