But, many experts were immediately sceptical, saying the industry was wasting too much time trying to keep control of distribution and stopping fans from stealing music instead of luring millions of consumers already surfing online for CDs.

"I was incredibly disappointed. What I had hoped to hear was the industry would, between the next 30 and 90 days, identify a format or technology to begin the delivery of music online," said Mark Hardie, analyst with Forrester Research.

Hardie said the problem of pirated music, while relatively small, will grow in the year the coalition, to be called the Secure Digital Music Initiative, has targeted to find an open specification to protect copyrighted music online.

The venture was announced on Tuesday at a news conference in New York. HilaryRosen, president of the Recording Industry Association of America (RIAA), said the group hopes to have a standard for conforming products by 1999's holiday season.

There are currently three technology platforms for downloading music, including AT&T Corp's a2B music, Redwood City, California-based Liquid Audio and the leading but controversial platform, MP3.

Rosen said all three formats will be represented. "This process will not choose a winner or loser in terms of companies or distribution format. The point is to create an open architecture that can support many kinds of business models and competitive interests," Rosen said during the conference.

But, again, industry experts, were doubtful. "Clearly if you say that something's going to be a standard, one or more of these systems has to be a loser," said Bruce Haring, author of "Off The Charts," a book about the music business.

The initiative comes as a legal battle rages between the record industry and Diamond Multimedia Systems Inc, which has madea device using the controversial MP3 format that lets fans download free CD-quality songs quickly.

Music companies have argued the MP3 audio compression format is used to make pirated copies of CDs.

But, Diamond Multimedia said it would participate in the initiative, which is considering MP3 in its strategy.

"MP3 is an important format. We're hoping this initiative will develop ways for those artists who want to use MP3 and secure their music with that format to prosper," she said.

Some experts predicted the coalition wanted to form a system that would scramble the digital music codes and enable only paying customers to receive unscrambled digital data.

Forrester Research forecasts that online music sales will soar from $187 million in 1998 to $4 billion in 2002.

Record companies including BMG Entertainment; EMI Group Plc; Sony Corp; Seagram Co. Ltd.'s Universal Music Group; and Time Warner Inc.'s Warner Music Group were at the conference.

Participating technology companies include AmericaOnline Inc., AT&T, International Business Machines Corp., Lucent Technologies, Matsushita, Microsoft Corp., RealNetworks, Sony Corp. and Toshiba. The International Federation of the Phonographic Industry is also participating in the initiative.

Alex Alben, vice president at Real Networks Inc., a seller of software and systems used to deliver audio and video on the Internet, said the coalition was an important starting point by the record industry towards embracing the Internet.