Entelligence: Stream on
By Michael Gartenberg 
posted September 4th 2009 12:32PM
posted September 4th 2009 12:32PM
Entelligence is a column by technology strategist and author Michael Gartenberg, a man whose desire for a delicious cup of coffee and a quality New York bagel is dwarfed only by his passion for tech. In these articles, he'll explore where our industry is and where it's going -- on both micro and macro levels -- with the unique wit and insight only he can provide.
Having said that, Apple's model isn't the only one out there. Microsoft, Real, Napster and others have all tried to push the subscription model that allows users to consume as much music as they wish from a catalog of millions of songs for a monthly fee. Some services, such as Microsoft's Zune Pass, also allow users to keep a certain number of songs each month in unprotected format. Although subscription services will likely continue to need be protected by some sort of DRM I don't really have an issue with that. Technology like DRM should be used to create new business models, not protect old ones.
I like the subscription model a lot. For one thing, it's one of the last ways for vendors to set themselves apart from Apple and the iPod. Clearly, there's a consumer market for subscriptions as well, even thought current services haven't taken off the way iTunes has. There are two things missing that's preventing these services from going mainstream. First, there has yet to be a clear articulation of the benefits of this type of service to consumers. As I've said in the past, consumers have traditionally had only two ways of getting music: free radio and purchased music. If subscription services are ever going to take off, there's got to be some effort to explain the benefits of the subscription model to consumers.
But that's only part of the story. The second is devices.
Connected phones and subscription services together can help generate the next big inflection point in the music industry. |
In the last week, Apple approved the Spotify app and Rhapsody submitted a new iPhone app. The iPhone is particularly important -- according to Interpret's data, it's the one phone users are purchasing for its media capabilities. With these two apps, consumers will for the first time have the chance to create powerful individualized services, optimized for the their listening tastes. If Rhapsody and Spotify bother to take the time to explain just how the subscription model can co-exist with the music already owned by the consumers, we just might see theses services go from niche, music aficionado-oriented brands to mainstream success. It's been a long time coming, and if these services do start to gain traction, I expect we'll see Apple launch their own service as well. Connected phones and subscription services together can help generate the next big inflection point in the music industry. Now if Apple will just approve that Rhapsody app so I can finally get my stream on.
Michael Gartenberg is vice president of strategy and analysis at Interpret, LLC. His weblog can be found at gartenblog.net, and he can be emailed at gartenberg AT gmail DOT com. Views expressed here are his own.
...Only reason I went with the Storm is it plays well with Rhapsody. Otherwise, I would have gotten an iPhone. Well, the fact that I despise AT/T with a passion also influenced me.
iPhone and Rhapsody on Verizon? Done, done, and done! Can't wait.
Ughhh! Come on! This article is sooo biased in favor of Apple. I've been streaming music on my Nokia N95 and N97 now for ever. Nothing new here but the total lack of awareness on the authors part.
I agree. Just read the line about Nokia and not knowing how to use music and phones together. What a joke!
I guess Michael has never heard of Comes With Music? This indicates that Michael is not in tune with the industry or has not done enough research, did not see or hear any of the announcements with the new "x" phones. Clearly does not know about CMW 5800 or other models.
People will always buy music, despite the how they pay for it, or how much. Music is simply just to great, to actually have a price, so I think that we shouldn't pay for it. But we should support the people who make the music, along with paying the services and production behind getting that music delivered to us. I really think that this could have been the music has always been sold on using the internet, it reminds me of tv/ of cable.
Subscriptions are and will remain a niche means of accessing music for the simple reason that people are averse to continually spending money for something they can either randomly access for free, or can "possess" on entirely their own terms when they have developed a particular affiliation for it. The music companies have monetarized music to maximize value (to themselves) and in so doing get between the musician and their fans. Fidelity/quality, etc is just a never ending means to repackage the same product. Patents expire after 2 years or so. So should music royalties. To make up for the loss of earnings, musicians should be paid relatively more for their wares. This would allow the building of music repositories that are freely accessed and available to anyone, much like public libraries (and especially the Google eBook project).
The bottom line is that with Spotify, Apple has finally provided access to subscription services via their eco-system so people have a choice. Moreover, outright electronic purchase of music is now absent of DRM (iTunes and Amazon). However, until the subscription companies work out a way to allow easy and true portability, this niche will stay that way (unfortunately).
Its interesting but I'd like to point out last.fm, pandora, and services similar. It enhances your phone multiphone when an app exists. I have a blackberry I didnt see compare to an iphone for a long time. Then i discovered that data can come in my phone like any other phone and there has to be a music streaming app. And there was, Pandora and Slacker available. I dont see many people looking at videos on their phones but there you go music is already there just not subscription based. I believe Pandora or last.fm being more aggressive with advertising could gain mass amount of phone users.
I still buy CDs.
Can anyone please tell me:
What makes people not want to pay for music:
1) The idea of getting it for free elsewhere
2) The reality of getting it for free elsewhere
3) The perception that "big labels" are out there to "stick it to you"
4) Music sucks so why should I pay for it when I can steal it and it'll still suck
5) The cost of music is next to zero, so why should I be the guy to pay the dollar after the $125 it took the artist to make their money back
Really. I really, really want to know why anyone thinks they should listen to 40 hours of music and pay only a dollar for that experience. Really, really want to know.
Where am I coming from? I made a record. A good one. No, really, a really good one. I want to know what people are thinking about music these days. TEST ME: www.zetavang.com