To begin with one can not download music from internet in full CD/WAVE format but only in MP3, so untill that will be avalable I don't think it really any competition. And I don't belive those record companies will ever allowed that to happened.
Will the ipod be the death of the CD?
Tonight on NBC News a segment on the final days of "Towers Records" closing. Record retailers are going out of busines because of the ipod and digital downloading of music from the internet.
There are some who say the CD will be gone in less than 5 years.
What the heck is ipod?
How is the sound quality?
Can I connect it to my 2ch audio system?
http://www.nme.com/news/ipod/25033