Your problem is MusicMatch. In the RCA manual, which is found on the CD or online (nothing is printed), it refers you to the MusicMatch software to learn how to create M3U playlists. Someone at RCA didn't talk to MusicMatch before making this claim. The MusicMatch software makes a mess of the files and never saves a playlist properly. You can devise a process using WinAmp which would probably work with Musicmatch, but I prefer WinAmp. Here's the process:
Rip your CDs, download from the internet, and transfer the files to the RD2850 while the Lyra is connected as a hard drive. The files are
stored in the /MUSIC directory. I suggest you organize your albums like this /MUSIC/
/
If the artists you listen to have multiple albums, a structured approach is useful. The Lyra can sort the files by Artist and Album automatically if the tags are available, meaning a structured directory approach is unnecessary, but it makes it easier if you want to take the files off the Lyra in the future.
Once the files are on the Lyra, use WinAmp to open those file FROM THE LYRA.
This is important since the playlist will specify the relative path of the MP3 files and the Lyra expects the playlists in a directory other than where your music files are.
With WinAmp open, press L to open the file selection dialog and navigate to the directory with the album, or music. Select the songs, press Open.
Open the Playlist Editor (ALT+E)
Arrange the songs
Save the songs with the List Opts button found at the bottom right of the screen. Chose Save List. A dialog will open asking you where to save the list.
Save the list in the /lyra_playlists directory from the root of the drive. Now, the Lyra needs to be updated. This is called "Profiling". The included software has a utility to do this from Windows, or you can do this from the Lyra itself. The manual states if you have over 2500 files, it is best to do this from Windows. But, after changing anything on the Lyra, you must "Profile" the device.
You will now see your playlist in the Playlist menu item on the main screen.
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