Bertlesmann to launch music service

Bertelsmann's 'Gnab' P2P service will go live in Germany by the end of this year

German media giant Bertelsmann is to launch a peer-to-peer network service to offer legal downloads of music and movies.

The service, dubbed Gnab, or 'bang' in reverse, is to go live in Germany by the end of this year, with an eventual rollout to other countries through 2006 and beyond, the company said.

Bertelsmann has prior experience with P2P networking, having invested in Napster, a move which foundered on lawsuits over copyright.

Mark Mulligan, research director at Jupiter Research Europe, said: "This will be no different from any of the other P2P offerings like Wippet, Playlouder and Mashbox.

"The problem is that the big labels don't like them because they can't offer digital rights management. The whole business model of the music industry is to get as many downloads as possible from a single track. Without rights management that cannot occur.

"The fact that Bertelsmann owns 50 per cent of Sony BMG does not necessarily mean it will be able to put its catalogue on this service."

Gnab uses a decentralised P2P network to offer downloads whose original content is hosted on centralised servers.

The service will be licensed to partners which can use it to sell their own downloads, meaning that consumers only will get to use it if they go through a particular partner or company.