It’s called “slotMusic,” and it’s music on fingernail-size microSD memory cards that will be priced similar to CDs. SanDisk, the four major labels, Best Buy and Wal-Mart think consumers will forgo buying CDs in favor of slotMusic micro cards. That is, those consumers who still buy CDs. After all, albums sold on CD dropped by 19 percent last year, according to Nielsen SoundScan figures.

The drop in CD sales isn’t directly related to rising download purchases. Purchases from online stores like iTunes or Napster still haven’t picked up the slack created by music fans illicitly swapping songs on P2P networks.

But whether consumers still buying CDs will switch to slotMusic microSD memory cards is the big question. Music on the memory cards will be encoded in the MP3 format without any DRM and will play back at rates up to 320 kbps. However, audiophiles may end up forgoing the cards in favor of CDs where they can decide on encoding rates.

Chances are you already have something in your electronic toy collection capable of playing slotMusic. Many cell phones are already compatible with microSD cards, as are many multimedia players. Furthermore, a small USB dongle that comes with the microSD cards makes the medium computer-worthy.

Although the slotMusic microSD cards will also contain album liner notes and artwork, plenty of space will be left for consumers to store whatever they want on the cards.

One sticking point may be with environmentalists. While the slotMusic memory cards are about the size of a fingernail, they will be packaged in boxes similar to what’s used to package CDs. It was only a few years after the introduction of CDs when environmentalists complained about the waste of paper products used to package CDs in boxes that were often twice the size of the compact disc. Those complaints led to the current jewel-box packaging the labels have used for the past 20 years.

Will slotMusic eventually replace CDs?

Hard to say, but Best Buy and Wal-Mart stores plan to devote a considerable amount of space to the cards. But as to whether the cards will replace CDs – that’s a question that will probably be answered by consumers.

However, Rio Caraeff, executive VP of Universal Music Group’s eLabs digital music unit, thinks the cards could eventually replace CDs, saying, “I think we could certainly hope that would be the case, but I don’t think we are so tied to that.”