-- As Billboard already reported, Best Buy shares dropped 6% on weaker-than-expected quarterly profits. The company did not reveal much about music sales, but it did make clear the category was among the losers last quarter. Low double-digital comp store sales gains in notebooks, mobile phones and appliances were offset by losses in gaming, music and movies.

"We believe gaming is set for an exciting back half of the year," said CEO Brian Dunn during the earnings call. "With Chester-based gaming platforms like Microsoft's Kinect announced at E3 yesterday and firmware updates making millions of Sony PlayStations 3D-ready, we are on the front end of a new generation of gaming solutions. Also, as we just announced this morning, we will launch a used gaming business across all of our U.S. stores later this summer." SEC filing, Seeking Alpha)

-- Bonnaroo has got most of the media's attention on festivals this month, but south of Tennessee there was a well-attended festival going on a week earlier. Bamajam organizers say over this year's festival, held June 3 to 5 in Enterprise, Alabama, had 300,000 attendees over three days. (MusicRow)

-- LimeWire's publicity tour continues with the announcement of plans for a legal music site. A CNET headline asks the question, "If LimeWire builds a legal site, will labels come?" The obvious answer is that LimeWire had the opportunity to build a legal site before the site was found guilty of copyright infringement. Not only could LimeWire have taken the onus to change its product, but CNET reports some labels had met with LimeWire at least three times in the last 18 months to discuss a legal product but were "rebuffed" on each occasion.
What would a legal LimeWire look like? "It will have unrestricted downloading and streaming," the company said in a statement. "It will be easy-to-use and easy to pay for. It will allow consumers to better discover music through advanced search tools, find more recommendations, and have access to millions of songs on-demand." But CNET says the majors haven't been shown such a product, which makes the company's latest overture a plea for mercy that has probably come too late. (CNET)

-- One number makes clear a P2P service would have a hard time turning into a legitimate company while retaining its millions of users: $20 million. That's LimeWire's latest annual income. Think about that – the company that had the largest P2P application share in the U.S. could get only $20 million from its users ($34.95 per year for the Pro version) and advertisers. That's as much revenue as a $10 per month subscription service brings in annually from just 167,000 subscribers. Such low revenue flies in the face of arguments that labels should simply license P2P (this argument goes all the way back to Napster). Labels collect more money from iTunes in a single week than LimeWire made in an entire year. On revenue of $20 million, labels would get next to nothing from the most successful P2P application.

But could LimeWire have made more money? It stands to reason that a profit-seeking company would have created a legitimate music service if it felt it could generate more profit. Payments to content owners, however, would eat up much of a legitimate LimeWire's revenues whereas currently it pays nothing. And company executives must have known LimeWire's popularity would take a hit if the product was altered to meet the requirements of record labels' licensing agreements. In other words, LimeWire chose $20 million in high-margin revenue over an unknown amount of lower-margin revenue through a legitimate service.

-- An EMI Ireland exec says “significant progress” has been made with Ireland’s second-largest ISP, Vodafone, in putting into action a graduated response system to deal with digital piracy. The largest ISP in the country, Eirnet, has already implemented a graduated response scheme and according to numerous reports is using DtecNet technology to identify infringement. (Irish Times)

-- British retailer Tesco is planning to launch an online locker service for people to store their digital entertainment collections. The product could arrive as early as October. Items purchased at Tesco would immediately be available in an online locker that would be accessed by a registered device. An average household could have six users access the locker from 12 different devices. Lockers would be synced up with the database of Clubcard, Tesco’s loyalty program. (Home Cinema Choice)

-- Google TV explained. (YouTube)
-- EMI Music Japan is distributing its four-year-old magazine “Great Hunting” as a free e-book for the iPad and iPhone. (Trading Markets)
-- Isohunt’s attorney says the embattled BitTorrent and P2P search engine is not yet dead. (Wired)