The New York Times reports that while everyone was focused on Amazon's new online music store last week, another online store--launched to much fanfare--is dying a slow death. AnywhereCD's founder, Michael Robertson, offered an unusually frank epitaph on his blog. "It's a real shame," he wrote, "because I think it was a solid business idea."

AnywhereCD was an effort to please both consumers and the record labels. It offered a physical CD along with downloads of the CD for one price. But in the end, while some labels were enthusiastic, only Warner Music Group got behind the idea. And they ended up suing each other anyway, as we reported several months ago.

But that's nothing compared to the ignorance the other labels displayed. "One [label executive] insanely asked me if I would embed the purchaser's credit card number in the song files they bought," he wrote. And the music industry wonders why it is in a downward spiral.

Note that before AnywhereCD, Robertson also founded the fabled--and also ultimately doomed--MP3.com. Here's hoping that one day he succeeds.

Elegy for a Novel Music Store [NYT]