The Internet offers unprecedented opportunity for manufacturers to bring their products directly to their markets, but many companies have been reluctant to embrace it for fear of upsetting their established dealer networks. This has been especially true of mid-to-high-end audio companies, who have traditionally sold their wares through specialty shops.

Wes Phillips explains that Adcom is one of those companies that is easy to take for granted. "To break through our complacency, Adcom would have to produce an outright unlistenable turkey&mdash;or a product that raised the bar so high that any audio manufacturer would get a hernia just <I>thinking</I> about raising it again."

Last week, GlobalNet Systems announced that violinist Itzhak Perlman has joined its subsidiary <A HREF="http://www.OEN.com">On-Line Entertainment Network</A> as consultant and advisory boardmember. The company says that Mr. Perlman will consult on its acquisition and production of live classical-music events and the licensing of master catalogs of recorded classical music. He also joins an advisory board that will advise on future trends and opportunities for the company. The company intends to add other major artists to its advisory board in coming months.

While all of the attention was on SDMI and watermarking earlier this month, <A HREF="http://www.diamondmm.com">Diamond Multimedia</A>, the <A HREF="http://www.riaa.com/"&gt; Recording Industry Association of America</A> (RIAA), and the Alliance of Artists and Recording Companies (AARC) quietly announced the settlement of all pending litigation related to Diamond's Rio portable Internet music player. (See <A HREF="http://www.stereophile.com/news/10324/">previous story</A>.) All three parties say they have dismissed their legal actions, and have announced the mutually satisfactory resolution of outstanding legal issues.

After months of wrangling, the <A HREF="http://www.sdmi.org/">Secure Digital Music Initiative</A> (SDMI) has selected <A HREF="http://www.musicode.com/">Aris Technologies</A>' MusiCode as its recommended form of digital audio copy protection, according to an inside source at SDMI. The decision came at the end of weeks of <A HREF="http://www.stereophile.com/news/10511/">testing</A&gt; various watermarking techniques on the music industry's "golden ears"&mdash;recording and mastering engineers, music producers, and professional audiophiles. The official announcement is expected later this week.

Selling consumer-electronics gear over the Web has begun to glow white-hot in the last year, with dozens of companies turning up the competitive burners (see <A HREF="http://www.stereophile.com/news/10514/">related story</A>). It will likely be a tough business, with the inevitable shake-outs and mergers taking place as retailers test their strategies and brands on the public's pocketbooks.

L<I>ast week, Robert Rich began this two-part article (<A HREF="http://www.stereophile.com/news/10508/">click here for part one</A>) with an explanation of ambient music and pointers to some of his favorite artists' web pages. This week he wraps up with more web resources, including record labels, webzines, and online radio programs dedicated to the genre.</I>

Last week, <A HREF="http://www.usadr.com">USA Digital Radio</A>, a developer of In-Band On-Channel Digital Audio Broadcast (IBOC DAB) technology, announced an "aggressive" field-test campaign at 12 radio stations across the country. The company will be conducting the digital tests under experimental licenses issued by the Federal Communications Commission (FCC). With most equipment already installed, according to USA Digital Radio, test efforts are currently underway at several stations.

Tonal accuracy vs. soundstage? "Achieving an optimum balance between the two philosophical extremes of recording is where much of the art lies. It also begs the question, of course, of why it's impossible to have both: a recording with a virtual-reality sense of imaging that also captures all the sound without any coloration." While recording the <I>Sonata</I> CD for <I>Stereophile</I>, John Atkinson wrestles with every recording engineer's dilemma. Read about the struggle to capture Robert Silverman performing Liszt's monumental B-Minor Piano Sonata and the ultimate solution in "<A HREF="http://www.stereophile.com//features/131/">Fate, I Defy You</A>," added this week to the archives.