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The Day the Music Died

Just a year ago, the excitement of the foretold "digital revolution" was still quivering at near mass hysteria. Digital distribution of music was going to change the face of the music industry, we were told, take power out of the hands of the labels and put in back where it belonged - with the little guy, the independent musician. Long before that dream filtered into the mainstream consciousness, a few music lovers launched a site that really was a pioneer of its time: The Internet Underground Music Archive (IUMA) ( www.iuma.com ). This week IUMA ceased operations.

Jeff Patterson founded IUMA with the idea of increasing distribution for bands. The site charged a nominal fee for musicians to post Web sites and samples of their music. In an interview this week, Patterson reminisced: "When we first started up our philosophy was that we are going to kill the record companies and it's going to totally change things. It took us about a year to figure out that the labels are not going to go away, they are still going to be around to fund the major acts, there are still going to be the superstar."

The Internet was not slated to kill the superstar, but it can and does serve a function for what some might consider working-class musicians. "One thing the Net can help is the sort of musician that hasn't necessarily reached superstar status, but is decent enough to make a living off what they are doing. The Web helps them get distribution," said Patterson.

The company was founded way back in 1993 before the Internet was considered big business. Back then, Patterson says that they could stay afloat because the business worked almost like a nonprofit. The staff was working on a volunteer basis in the early days just because it was something fun to do. "Then we started hiring people and paying them, and we decided that if we were going to do this then we were going to do it big. And we should go out and make a big push," explained Patterson. In undertaking that large marketing push, the company incurred debt which lead to a search for more funding, resulting in the company being acquired by Emusic last year.

In January 2001, Emusic chose not to renew IUMA's funding for 2001. Emusic decided they should focus more directly on other aspects of their operations that the company believed to have greater growth potential. At that time, IUMA's staff of eight was effectively laid off. However, according to Patterson, the majority of the staff pitched in to keep things running while they sought other avenues of funding.

This week it reached a point when, says Patterson, they had to tell people to start looking for new jobs. A letter posted on the IUMA site on Wednesday stated that while the management was still hoping to secure funding or find a new partner, they were having to cut all operations requiring human action - including CD sales, customer support and new artist submissions. Automated aspects of the site will remain operational.

"Watching all these companies come and go, I think the lesson is that you don't need to be flashy with a huge name in order to become a viable business in this space," says Patterson. According to him, IUMA was slated to become profitable this quarter.

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