How Music Got Free

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problem” and about the “political” nature of the MPEG decision, but some of his explanations sounded more like excuses.
    They were saved in the end bya guy named Steve Church. Grill had first met him at a trade show in Las Vegas the previous year. The CEO of a start-up called Telos Systems, Church was a former radio talk show host and studio engineer who saw a market for improving the quality of audio broadcasting. Like Brandenburg and Grill, he didn’t trust MPEG, as he had seen these “impartial” standards committees make biased decisions before. He agreed to an independentlyrefereed head-to-head listening test between the mp2 and mp3, and was startled by the results.
    The mp3 was way better! Shortly after the demonstration, Church called back to the home office in Cleveland and arranged to repeat the experiment over a newly installed digital telephone line. The demonstration material was an encoding of Steely Dan, a band as beloved in Ohio as it was in Bavaria. Telos became the mp3’s first—and for some time, only—enterprise-scale customer. Church commissioned several hundred mp3 conversion boxes called Zephyrs, the size of VCRs, capable of streaming mp3 audio in real time. He then turned around and licensed these to
biggest customer: the National Hockey League.
    Here, finally, was a stroke of good fortune. One of the key reference materials in Bernhard Grill’s menagerie of exotic sounds was a recording of a German-league professional hockey game. The sound of scattered clapping had always been a challenge for the encoder, particularly when set against a dynamic soundscape of scraping skates and brutal, bone-crushing checks. The sample was a small snippet of on-ice action, followed by a few seconds of indifferent applause. Grill had listened to it hundreds of times, isolating the encoding errors and working with Brandenburg to implement fixes. The NHL was the perfect customer: the mp3 had been specifically calibrated to the sound of the game.
    But the league had certain technical requirements, and these took months to meet. By the time the units finally shipped in late 1994, the hockey players had gone on strike. That year’s shortened season didn’t officially begin until January 20, 1995—the official start date of the mp3 revolution in North America. The fastest game on ice was not widely understood to be a pioneer in digital acoustics, but as the first puck dropped on center ice that year, fans of the Blackhawks and the Red Wings were an unwitting audience on the cutting edge.
    It wasn’t until after the 1995 decision in Erlangen that income from the sales finally began making its way to Fraunhofer, arriving just in time to save the mp3 team. The Zephyr racks allowed radiobroadcasters to save thousands of dollars an hour on satellite transmission costs, and were installed in every pro ice arena in North America. Telos’ revenues quadrupled, and Steve Church became a zealous advocate for the technology. Soon he was in talks with every major North American sports league. But Fraunhofer received only a small cut. The licensing agreement they’d negotiated with Church charged on a per-unit basis, and there were only a few hundred stadiums to sell to. The mp3 was alive, but on life support; to earn substantial profits, the technology would need many more licensees.
    For Brandenburg, that meant a continued push for the home consumer. Earlier in the year, he had directed Grill to write a PC application that could encode and play back mp3 files. Finished within a few months, Grill dubbed it the “Level 3 encoder,” or “L3Enc” for short. The program fit on a single 3.5-inch floppy disk. L3Enc represented a new paradigm of distribution, one in which consumers would create their own mp3 files, then play them from their home PCs. For the home audio enthusiast, the requisite technology was just arriving. Introduced in late 1993, Intel’s powerful new Pentium chips were the first processors capable

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