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I don't download music. It's too slow, and both formats are lo-fi.
Streaming allows you to start hearing an audio track within seconds of selecting it from a website, but when you stop listening, it's gone. Downloading a track allows you to store audio on your computer for use now or later, but it can take a while to complete. Which method of getting audio from the Internet do you prefer?
If just the first two choices were given, I would chose downloading. I have found that streaming is suseptible to cutting out due to "Net congestion." I find this to be totally unacceptable! On the other hand, downloading takes time before you can enjoy your selection, and uses valuable hard-drive space. I would like to see improvements in streaming so that there are none of the interruptions commonly found today.
I don't honestly care, since I never download audio tracks off of the internet. However, it seems to me that the ideal would be technology that could allow for the best of both options--sort of like being able to "monitor" what is being recorded on a three-head tape deck.
I listen to audio tracks on the likes of Amazon.com only; I don't need to store the tracks because I can always go back to the site. Of course, once intelligent distributed caching has become the norm on the Net, there won't be much discernible difference between streaming or downloading (provided you have a fast connection to the Net).
Everyone knows that music off of the Internet, no matter what format, sounds terrible, so what's the point? When the Internet starts to put out great music that actually sounds reasonably good (when? who knows?) is when this will be a relevant question.
Bandwidth will get better, so waits will not be much of a concern for much longer. I would love to be able to download my favorite radio shows (even with ads) and listen to them at my leisure off a CD+RW or MP3 player or hard drive. Downloading or streaming music does not have too much appeal till I find out how the quality of MP3 compares to a CD on a good audio system.