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Warner's Rising Sun

Today is the dawning of a new day for Warner Music Group (NYSE: WMG  ) , and that's not just my cliché-o-meter going at full tilt. This morning, the record label releases the debut of Ohio-based rock quintet The Sun. The move kicks off Warner's new e-label in a daring way. See, you can pick up the band's music only on vinyl, DVD, or through digital distribution hubs such as Apple Computer's (Nasdaq: AAPL  ) iTunes Store, Napster (Nasdaq: NAPS  ) , and RealNetworks' (Nasdaq: RNWK  ) Rhapsody.

That's right. No CD. Unless you're a vinyl junkie with a penchant for that retro turntable, most music fans can experience the new band's release only through a DVD filled with videos of the tracks or by paying for digital downloads.

Skimping on the CD -- for years the bread and butter of the prerecorded music industry -- is a bold move. It funnels listeners to the online channels where the fulfillment and distribution process are so much more cost-effective for the labels.

However, that also requires using the Internet to create a buzz, and The Sun has had some early success on that front. The band has an active page with select streams on MySpace.com, with nearly 16,000 virtual friends already on board. This is the same social networking site that R.E.M. recently used to hype its latest CD. MySpace.com is owned by Intermix (AMEX: MIX  ) for now. News Corp. (NYSE: NWS  ) announced back in July that it would be acquiring Intermix.

The band's push for fame ahead of today's release doesn't end there. The Sun's PG-13-rated companion video for Romantic Death has been a viral hit on iFilm.com, where it has been streamed more than 472,000 times.

If this translates into success for The Sun -- and a financial windfall for Warner -- it could revolutionize the stodgy music sector as we know it. It's perfect timing for an e-label, too, as more and more peer-to-peer file-trading sites like Napster and Grokster are either going out of business or being remade into legal distribution outlets. Just last week, swapping sites WinMX and eDonkey went dark.

The Sun shines? Why dabble in clichés when the symbolism-o-meter holds even richer rewards.

Longtime Fool contributor Rick Munarriz thinks that we are living in a material world and Warner Music Group is a material girl. Yes, Madonna is also part of the Warner Music family. He does not own shares in any of the companies mentioned in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy .


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Related Tickers

2/13/2012 4:00 PM
NWS $20.11 Up +0.26 +1.31%
News Corp. CAPS Rating: **
RNWK $10.95 Up +0.13 +1.20%
RealNetworks, Inc. CAPS Rating: *
WMG $8.25 Down +0.00 +0.00%
Warner Music Group… CAPS Rating: *
AAPL $502.60 Up +9.18 +1.86%
Apple CAPS Rating: ***
MIX $21.16 Down +0.00 +0.00%
MERRILL XOM STRIDE… CAPS Rating: No stars
NAPS $2.64 Down +0.00 +0.00%
NAPSTER, INC. CAPS Rating: *

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