EMI has pledged to digitize its entire catalog as the group moves to embrace opportunities in the digital-music environment.

EMI has pledged to digitize its entire catalog as the group moves to embrace opportunities in the digital-music environment.

During the company's "Digital music investor day" yesterday (July 1) at Abbey Road Studios in London, EMI executives outlined plans to offer 100% of its repertoire through legitimate and commercially viable platforms.

EMI Group chairman Eric Nicoli told analysts and investors that the major expects attractive revenue and profit growth from the digital space in years to come.

In three to five years, the company's recorded-music business model will allocate a bigger piece of its "music pie" to digitally distributed product, explains EMI Music chairman/CEO Alain Levy. "EMI Music will no longer be a physical record company, but a digital-music business at large," Levy said. EMI envisions that about 25% of its revenues will be extracted from digital products and platforms during that time frame, with the remaining 75% from traditional sound carriers.

"Despite the lack of visibility, we believe a key point of inflection has been passed, with the market now perceiving digital as an opportunity for the music industry rather than a threat," comments an analyst for UBS.

To date, EMI has cleared the "vast majority” of its catalog for digital use. At the group level, revenue from digital-music products tripled to more than £15 million ($27.2 million) in sales, 0.7% of a total £2.12 billion ($3.84 billion) sales in fiscal 2003. Ringtune and ringtone revenue accounted for more than half of that figure, according to the company.

"EMI now seems to have all the relevant systems and building blocks in place to capitalize on this growth and the company [is] optimistic about the opportunities digital presents," says ABN analyst Bridie Barrett.

EMI's renewed commitment to digital distribution comes as iTunes Music Store announces its market-leading European download service has sold more than 1.5 million tracks since launching in the United Kingdom, Germany and France on June 15.