Subscription Based Music Services
NYT:
“Rdio and similar start-ups are reinventing a concept pioneered earlier this decade by Rhapsody, a service majority-owned by RealNetworks, and the tamed version of Napster, now owned by Best Buy. A few hundred thousand Rhapsody and Napster subscribers pay monthly fees of around $15 for the right to stream an unlimited number of songs, at any time, from their PCs and mobile devices.
But with modest membership growth at best, neither service has managed to challenge iTunes, with its many millions of users — or enticed music lovers from pirating music. Moreover, Yahoo, AOL and MTV Networks have abandoned their own music subscription efforts.”
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Here is my (obvious) question:
Will any subscription based music service be able to find an audience if the songs cannot be transferred to an iPod?
The next question is, can they get the labels to approve that? If they can, will they be able to make any money doing it?
Here are the various players:
Reader suggestions:
I have no preferences with these — I occasionally use Pandora (but I am not a convert yet) Mog looks interesting.
Anyone have much insight into these?
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Source:
Still Hoping to Sell Music by the Month
BRAD STONE
NYT, 10/14/09
http://www.nytimes.com/2009/10/14/technology/internet/14music.html
October 14th, 2009 at 9:01 pm
I don’t believe they will ever be able to make money as long as there are free alternatives out there. I am not familiar with those other players but Pandora is free for the first 40 hours each month. And there is grooveshark which allows you to play any song you want at anytime for free. And a lot of people who want to listen to a song or 2 on demand can also turn to youtube.
October 14th, 2009 at 9:09 pm
I believe subscription services have a very limited future that will be increasingly confined to an aging profile over time. Moreover, the record label business model is pretty much dead. Technology has enabled and era where consumers get to choose exactly what they want. That leaves entertainment ala Wolfman Jack left to fill in the cracks. The most successful artists these days are the touring types who have an ongoing relationship with their listeners based on the experience of seeing them live and not just selling them CD’s. Selling CDs or downloads are a means to an end, not the goal of the business model.
October 14th, 2009 at 9:15 pm
I’m personally not a big believer in subscription, at least not in the form it’s been tried and discussed. Music is not like television. People don’t experience it the same way. How many times do you want to watch your favorite episode of any TV show? Contrast that with the number of plays on any of your favorites in your iTunes library. Moreover, music is for most people a background experience. They listen while they’re doing other things – homework, housework, cooking, running, whatever. So you need to make a subscription experience that fits how the listener likes to listen (and perhaps gives them additional options they never knew were possible). It has to be portable and, yes, it has to work on iPods (which I don’t see as a problem for anyone).
The real answer seems to me to be an ISP level fee that essentially monetizes currently non-monetizable activity (ideally combined with effective filtering to permit copyright owners to determine what is and isn’t available — but I think that has too many hurdles at present). There are ongoing discussions with the ISPs in Europe on this issue, but price is a sticking point. ISPs feel they can’t charge extra for access to music, and don’t want to give a piece of their current revenue to the music business for this stuff. On the other hand, the ISPs are under pressure in the UK, France and elsewhere with laws cracking down on piracy and they are also facing bandwidth issues, so there is some incentive to move towards an agreement.
There’s a company called Choruss that is looking at a network level fee with US universities, and are trying to get a test launched at some point next year. I don’t know where they are with it, but that’s the kind of thing that may help prove the concept.
At the end of the day, it seems to me, the consumer needs to feel that music is “free” because it has, in fact, become so. Competing with free is just impossible. People like free. And advertising can’t support the business. So, the money needs to come from those who provide access to the pipes. The pressure in Europe is a good start. If we can bring that pressure to bear in the US, then I think we’ll have a shot at having a business that makes sense. If not, well….
October 14th, 2009 at 9:23 pm
I will second Pandora — I use it all the time, and think its great
October 14th, 2009 at 9:25 pm
No, a subscription service will not work without the ability to put songs on an ipod.
I was on a college campus during the birth of the original napster, and watched it with awe. As a music fan I was horrified by the sound quality of most of the songs, and the complete lack of consistancy in the naming. Did you know Bob Dylan sang Brown Eyed Girl?
Since then I have thought that the only way for the music business to survive would be to own the organization of music, and sell that.
There is also the fat tail, the huge amount of recordings of performances and tracks that are never released. The music industry could try to capitalize on that. Most people don’t want every performance of an artist, but some do, charge them for a good copy of that. Most of the archive material that exists will never be heard by anyone, it is not cost effective to compile and release a CD. This could get around that.
Coming of age moment- A friend who worked for a while in the music business said that it was not possible to like music and be in the business. Its going even further that way.
The current state of pretending that everything is fine and huddling in with all of the other industry members is very familiar. I think the banks are going to last longer than the music industry.
October 14th, 2009 at 9:29 pm
The business model of the RIAA-represented music industry is not about music. It is about control of music. The RIAA-represented industry wants consumers to purchase the same content over and over. I have have albums in vinyl, half-speed-mastered vinyl and CD. I have refused to purchase the content in SACD due to the onerous DRM control mechanisms.
So, will a subscription-based music service work? IMO, no. When I subscribe to a magazine, I have something physical that I can read each week or month. When I subscribe to music, I am really just buying a pass to access the music. I get nothing tangible for the money I pay out. Nothing tangible. The RIAA-represented music industry gets my money, but gives me nothing.
Consider that Radiohead’s name-your-own-price album was their most profitable ever, maybe we ought to rethink the control the record companies have over the music we buy.
October 14th, 2009 at 9:39 pm
Deflation is going to hit some industries especially hard. You don’t have a job, or much money, so why would you pay for ANYTHING if you can get it for free?
Music industry, newspapers, Bear Stearns, saber-toothed tiger, wooly mammoth – these are SECULAR changes.
October 14th, 2009 at 9:50 pm
I feel bad if I don’t use Netflix for a few weeks, but keep on paying the monthly charge (but I probably won’t quit).
However, music is different. There are so many folks doing needle drops great on OOP music and making it available, and so many used inexpensive CDs available from lots of sources, it doesn’t make sense to me to subscribe to any music service without an option to place it on the drive.
October 14th, 2009 at 9:56 pm
> There are so many folks doing needle drops great on OOP music
Like this one?
October 14th, 2009 at 9:59 pm
One you left out is emusic (emusic.com), which has a subscription model that you pay a fee for a set number of downloads per month (30, 50, etc.). The downloads are mp3s, so you can add them to the iPod or any other player, and there’s no DRM. They are now adding more major labels. It’s $10/mo. for 30 songs, which works out to 33 cents per song, a much better deal than iTunes.
Also, I don’t know if napster has changed, but it used to be that if you let your subscription lapse, you didn’t get to keep any of the music. If I’m going to subscribe to a music service, I’m going to be sure I can keep the music when I leave. Music is different than movies/tv as in the netflix model.
October 14th, 2009 at 9:59 pm
Even the venerable Sirius XM powerhouse has an IPOD ability.
October 14th, 2009 at 10:11 pm
For completeness sake, I throw in the Zune pass. I mostly listen to podcasts and library audiobooks, so I can’t claim much interest in this. Being cheap and independent, I use a 4gb Sansa Clip, Juice and Mediamonkey.
Anyways, on the Engadget podcast recently they liked the Zune pass MS has brought out with the new Zune. The Zune pass allows unlimited streaming on three zunes and you get to keep 10 songs a month for your permanent collection. It would seem to be good for those who want to try the latest albums without having to buy them. The songs are all unprotected mp3’s.
Of course that eliminates the ipod angle.
October 14th, 2009 at 10:18 pm
In Nashville the CMA is currently trying to persuade ISP’s to shut off service to a third illegal download offense. First and second offense would be an email warning. So far the ISP’s have rejected the idea.
October 14th, 2009 at 10:20 pm
I still prefer radio to songs. At work, I listen to KSBR, a college radio station with jazz, hourly headline news (to act as a timepiece of sorts) and prefer the limited DJ patter to songs without interruption. So I pay a subscription to Live365.com to listen to that or any of thousands of other stations. But pay for music, no thank you.
October 14th, 2009 at 10:56 pm
I know a few Pandora fans that opted in in order to opt out of the ads. In my day that’s what the record store was for. Honestly though I preferred cassettes to 33’s so I guess I was no different than today’s teens that drop money on low -fidelity mp3s. Is the hi-fi stereo system dead?
October 14th, 2009 at 10:58 pm
Rhapsody has a to-go subscription for abour $15 a month, which allows me to transfer an unlimited number of albums/songs to my sansa player — I can load on hundreds of songs for one monthly fee, and keep adding/removing, and their catalog of music is extensive. Never will go back to iTunes…
October 14th, 2009 at 11:01 pm
No .. Why pay when you can get it for free. I just learned how to record music off youtube.. it’s the new napster
October 14th, 2009 at 11:37 pm
Check out Lala.com. You can listen to any song or album once for free. Buy streaming rights to songs for 10 cents or download for the same as itunes.
Also, you can stream any songs that you have in your collection without having to upload them to their servers. They just unlock any songs that you already own from their servers.
October 14th, 2009 at 11:50 pm
I really like Pandora while at my PC. Its’ really gotten a lot better recently. If I want to listen to something specific, I just use my I-Tunes.
October 14th, 2009 at 11:58 pm
I use to listen to Pandora while at work, courtesy of my (former now a Fios customer) Comcast cable subscription and I found it very useful.
I would grow tired of listening to the same songs on my Ipod so I would log into Pandora and listen to different music that I would not normally listen to, or would type in a artist name and find similar music to an artist I like. Sometimes I would like the music enough I would buy it for my Ipod. Seems to me Apple should be paying music players like Pandora a certain finders fee.
October 15th, 2009 at 12:01 am
I think Apple should think about buying an online music service and incorporate it into their business model. Listen to a song you like? Buy it for your ipod!
Actually there is a certain European based online music service I like to listen to that basically could crater all these online music services….but I aint talking.
October 15th, 2009 at 12:10 am
The pop-music industry built up a narrow business model in the 80’s and 90’s that the internet demolished. The effort was to create brands and sell records based on singles rather then albums (a concept that is finally returning). They then opted to resist technology and, better still, sue their customers for file-sharing. The major labels are still focused on re-releasing old music(predominantly to baby boomers). Meanwhile small bands have popped up everywhere by releasing their single hits to the world online, thus flooding the market and cheapening the product. While marketing machines are still able to rake in some cash, the music-on-offer has bypassed the record labels unwilling to embrace the new diversity available to consumers and freedom to artists.
The problem now seems to be whether any online radio service can offer a product with sufficiently low overhead, and of unique and personal enough content, that a business can monetize the service. Pandora seems to be trying, but we’ve seen the old labels attempting to siphon funds from the new technology that is trying to leave them behind. IIf Pandora is able to prove their service can make money, even with the drag from labels, and upstart new services trying to gain a client base with free services, then we will know there is room for profitable innovation.
It may not be until operations like the lethargic major labels, or leaching live nation type businesses are dropped by artists, and consumers, that a marketplace for cheap online radio will be able tp exist. It is amazine to look at the difficulties had now against the speed with which music took to radio. Why were we, or were we, so different then?
October 15th, 2009 at 12:54 am
I really like the Amazon thing when you can listen to a song and then download the mp3, you pay for it of course, but it all comes down to quality and respect for whom and what you download.
Let’s face it, most musical acts will have to make their money on the road nowadays, it is a good thing for musicians but then again computers can replace many of them.
Still, my advice and my hope is that everyone pays for the acts and the artists they respect, even if you can get it for free, pay for it or they’ll disappear.
Labels have had the easy way out for far too long, making no efforts and promoting bubble gum for kids who were the biggest buyers, dowloading has changed that, kids are not paying into the single business anymore and please keep downloading, long live albums.
So screw you lady gagas and American Idol by-products, I hope no-one pays for your crap.
BTW, MP3s have a much better quality than Itunes downloads.
October 15th, 2009 at 1:04 am
I think that flat subscription models have some future but IPod compatibility is essential. I think that with The Cloud now changing infrastructure and with some smart DRM tools it should be possible to have a minimal monthly fee for a service and then a pay per play fee on each song – so $15 for all you can eat is struggling against buy it for 99c or pirate it. What about 1c per play? Or $5 per month plus 1c per play for every play after the second one? Have the subscription follow you to your car and office. Get radio station content but replace their play list with yours. The DRM and device links all exist to make this a reality. It just needs subscriber management and the license holders to agree it makes sense to price content this way. You don’t need complicated protection tools just a simple app that keeps a count on what you listen to. Owning your own copy of a song is still a deeply held desire for most and until you can make an alternative seamlessly the same as owning it yourself it wont really catch on except for this who are overly price sensitive. and for them pirate is the cheapest
October 15th, 2009 at 1:12 am
Pandora is awesome. At first I hated it, now I use it all the time. It works on iPhone.
I went to a Music Industry conference in downtown NYC in 2005 and all the VPs of the subscription groups claimed it was the future. They are all abandoned as Barry mentioned.
In order to pay a subscription fee, I would want access to nearly the entire universe of music and it would have to be available on my device of choice.
October 15th, 2009 at 1:53 am
I use the internet radio, but none of these subscription stations. My Denon receiver lets me listen to internet radio, so I rarely listen local ever. KCRW, KEXP, WOXY, WXPN, University of Nottingham, BBC… I can seach/pick genre, country, stream quality. Why pay? I love college and independent radio simply because they aren’t jammed into some horrible format with a 30-50 song rotation, fake dj’s, and simply too many commercials. If I didn’t have it, I would probably use the stuff on our U-Verse/cable.
The other thing I find myself using a lot is iTunesj “Genius” and “DJ” features. With the Remote Ap on my wife’s iPhone and mine, I can control it anywhere in the house, and we pipe it into the kitchen via a mini Airport plug-in that is jacked into the speakers there…
Other people that I know use their 3g iphone, dock it and use one of the many streaming apps at home, in the car, and at work. Wolfgang’s vault is popular with more than a few guys who love that live 60’s-70’s rock recorded right off the soundboard.
So, No, with such intense competition for ears, and with so many access points that have no subscription costs how can any of these get meaningful traction? If I was going to guess which might be marginally successful, I would guess Napster as BestBuy is very actively pushing it in their stores. Even if all they do is successfully convert many/most of the CD buyers to Napster, they will benefited their bottom line. But as a guy who worked at an independent record store in college and for a while afterwards, I have a real “Jack Black” jaded view of anyone that would regularly buy CD’s from a BestBuy anyhow…they probably all listen to pop music and bad country and deserve whatever they get.
iTunes has a massive wall around it. Apple has massive market penetration with the iPod/iPhone lines and the path of least resistance leads back to iTunes. Amazon’s solution is a beaut–and I buy from them because their app places my purchases in iTunes for me. I get cheaper music with out any administrative hassles.
What I’d like to be able to do now with my iPhone is to “Bump” music to a friend like I can “Bump” other info…
October 15th, 2009 at 2:07 am
it’s too bad that this device:
http://clusty.com/search?input-form=clusty-simple&v%3Asources=webplus&query=Zune+HD+Radio
is hitting the Mkt. deaf to WiMax
coulda been a contender..IPRadio/low-power FM micro-casting has all the ability to be a, much-needed, game-changer.
the additional distro points could be very useful for these fledgling ’subscription radio’ purveyors..
maybe GOOG, w/ their AndroidOS (software-programmable radios y ‘Netbooks’, for starters) will fill the breach, here, too..
~~
as an aside, funny how the (misreading of) simple note from one dorm-mate, to another ~”Serg, taking the ’scope, out to go ogle the co-eds in the Quad.. Larry.” turned into the moniker of multi-Bn$ Co., and its own Verb.
October 15th, 2009 at 2:23 am
For those into more modern music, Pitchfork has put together a great staff list. It’s their top 200 albums of this decade with commentary:
http://pitchfork.com/features/staff-lists/7710-the-top-200-albums-of-the-2000s-20-1/
The best part is that nearly every album can be played for free or bought through an embedded browser application by Lala. I’m a big fan of Lala now…
October 15th, 2009 at 4:06 am
From what I’ve read so far I think most folks are missing the boat…You’re not going to supplant free music not even with Itunes…Like someone mentioned technology will find a way around any subscription service…The new paradigm for free stuff is to change the way you make money with it. Bands use the free music as advertising and as a way build their fan base. Once a song or recording reaches a saturation point then you go on tour….Thats where all the money is these days… Touring…A good band can really make a decent living on the road. Granted it’s harder than just kicking back and collecting royalties but allot of smart musicians have figured out it’s the only way from them to make any decent money doing what they love…
October 15th, 2009 at 5:02 am
Once you play music with Rhapsody, you are hooked. Rhapsody is ABSOLUTELY fabulous. Of course, there is a problem: RHAPSODY DOESN’T WORK WITH MY iPOD. That sucks. Furthermore, Rhapsody does not work outside of America.
Let’s get a couple things straight:
iPods are Great!
iTunes sucks! (it’s large and slow and clunky)
UNFORTUNATELY, AT THIS POINT IN TIME, EVERYONE NEEDS iTunes
Rhapsody is awesome!
Everyone knows that paying $1 for a song at iTunes sucks. Also, how many times have I had problems with iTunes, and had to reinstall iTunes, losing ALL of my purchased songs. Basically, iTunes is the 800 pound gorilla that everyone needs.
The best combination on earth would be: RHAPSODY and iPod.
I’m totally broke, but I would spend $15 per month on that.
October 15th, 2009 at 6:18 am
Here is another internet radio fully configured for Pandora, etc.
http://www.livioradio.com/
October 15th, 2009 at 6:33 am
And Here Come Another Round Of Yawn-Inducing Music Subscription Services
from the too-little-control dept
Well here we go again. There have been numerous attempts at music subscription services, and none have really done all that well. While some people do love their Rhapsody or Napster accounts — neither has been a runaway success, and both struggle to get much attention these days. Yet, so many entrepreneurs believe it’s a holy grail. So, here we go again. With plenty of people waiting for Spotify to enter the US market, the NY Times reports on two other new entrants; one from Mog — who seems to have blasted press releases to everyone, with the general reaction being a big yawn and one from the founders of Kazaa and Skype, called Rdio. Neither sounds particularly compelling.
The problem with all of these subscription services is that they inherently need to have limits. You have to keep paying, you can’t really share music with others, you may be able to take some of your music on the go, but it’s usually a convoluted process. And that’s a problem. Because people understand how mp3s work — and that’s without restrictions. Trying to get people to pay for a music experience with restrictions, that offers less than what they know can be done, is a recipe for failure. It’s time to stop thinking of trying to “sell music” and start realizing how you can use music to sell something better.
October 15th, 2009 at 7:09 am
Several of those (Spotify, Pandora, Rhapsody at least – didn’t try them all) wouldn’t let me sign up because they detected from my IP address that I live in Switzerland. Guess I won’t be using any of those services. Luckily I can buy things from iTunes, but that’s because I gave them a credit card with a US address.
Until the music industry learns to deal with the amazing (but true!) fact that there are roughly 6 billion people in the world who don’t live in the US, their business model will continue to consist of little more than bitching, moaning, and blocking access.
October 15th, 2009 at 8:26 am
The hot news in subscriptions services is what Microsoft is doing with their Zune Pass: $15/mo. for unlimited subscription music *plus* 10 free-to-own downloads/mo. of high-quality DRM-free MP3s.
How can they do this profitably, when Yahoo Music subscription service was unprofitable at similar rates *without* giving the free downloads?
If Microsoft actually pulls away some market share from Apple (the Zune HD has gotten stellar reviews, especially when combined with the Zune Pass subscription), then Apple may need to respond with their own subscription service.
October 15th, 2009 at 10:16 am
The nice thing about Rhapsody (and Napster) is that you can listen to albums or tracks before buying them (either on on your PC or a Using Rhapsody to-go device). If you like what you hear, you can buy it. A nice “try before you buy” feature.
There are also appears to be software that records (into an MP3) and identifies streaming music (replay music from applian), or records protected music (tunebite) off these sites. Applian has a FAQ entry on the legality at http://applian.com/legal.php
October 15th, 2009 at 10:58 am
I’m surprised no one has mentioned mtvmusic.com. Sure they do videos, and sure there’s no “download”.
But they do lots of what would be obscure very good performers. “Baby got no Draw’rs”. And they actually do music. Which MTV seems to have forgotten.
Remember the good old days when a good musician could have a hit without a “Hollywood” overproduced
video? It was about the music stupid. Tell me again why Madonna and Brittney are such superb musicians.
But you can capture everything someone chooses to “deliver” to your PC for free with the right software.
It’s still morphing.
And I agree totally that the quality of most of the internet music really, really sucks. It’s as if they intentionally downgraded it.
October 15th, 2009 at 12:37 pm
I’m with Rhythm above.. .
I heavy music listener and I love Napster. Although, I truly wish they could develop an damn iPhone app.
The whole idea should be to make it EASY.
I used to download content back in the hey-day, I could get anything I wanted…but eventually it became to much of a damn hassle.
It is simply easier for me to pay a reasonable fee for nearly all the content I want to listen to, anytime/anywhere. I don’t
have to put crap on my ipod or computer or whatever (or worry about RIAA suing my ass).
Anyhow, >>> All I need is an internet connection. <<<
It is sad these things don't catch on better.
I really don't see why content isn't pooled together in one big online service. IMHO, content producing entities that resist only hurt themselves. I know hard-core fans like to have their own collection, but like I said, it will be irrelevant soon, considering Internet connectivity.
BTW, Pandora is great, to a certain extent, but eventually it will play the same damn stuff too often.
AND, I fucking hate iTunes Store. Talk about a shit deal. I'd rather own a CD. But I guess some suckers like it?
Good luck!
October 15th, 2009 at 12:51 pm
I have used pandora and like it. I have an ipod and a sansa. However, I also still use cd’s and listen to the radio. ALL of these music systems have issues.
Internet radio suffers from a dynamic range issue. The music is not rich, same with satrad.
Ipods suffer from a similar problem. We live in a world where video is in HD. Yet the new standard for audio is MP3, which is a lower standard than what’s available on a cd. This makes no sense. I appreciate music. I want to hear it…really hear it. MP3 does not allow this. There are better standards but they are not widely used. I actually still buy and use my cd collection, transfer it without losing clarity to the puny little sansa and like that almost as much as the elegance of the Ipod.
I don’t see how any music service survives unless the price is lowered. Peg these services below $10/month and I think they will take off. However, we understand the industry will not allow this.
HD has come to radio, but the costs to add hd are just now begining to come down in price and outside of major markets I don’t know how many stations will use HD bands.
The music industry is a mess and those of us who enjoy music are constantly frustrated. How many times do I have to pay for a version of a song or album that i’ve owned and enjoyed? Why hasn’t competition driven down the cost of a single download? Why hasn’t the industry realized that consumers want a standard for audio that keeps pace with what’s happening in video?
One last point. My cable companies stream audio through several services. Why would I pay for streaming radio when I could use these services. I’m already paying too much for cable.
October 15th, 2009 at 2:52 pm
I have subscribed to the Napster service for a couple of years and love it. Not only does it assuage my guilt for the many “free” downloads I have enjoyed but it allows me to quickly and easily find and listen to new music. I find I don’t have time to download entire albums just to give them a try.
Often the gems aren’t the singles the record companies have decided to promote. I regularly fire up new releases, give them a listen and add tracks I like to my playlists. Its surprising what you find when you avoid the RIAA herd.
I think there is an upgrade price which allows me to download music to my Ipod but I’m not much of an Ipod guy as I’m rarely more than a few feet from a computer. I get way more sasisfaction from my monthly $10 to Napster than from my $XXX to the ^%$*^$ cable company.
October 16th, 2009 at 6:41 am
Grooveshark allows you to listen to any song on command, and its Autoplay does a solid job recommending songs. It’s my favorite site for streaming music. Lala, Last.fm, and Pandora are good ones, too. Amazon and Lala are my go-to places to buy mp3s.
October 16th, 2009 at 2:05 pm
On the streets of NYC they are selling bootleg CD’s for $0.50 (fifty cents). The reason, many people are downloading songs for FREE. I have a friend with close to seven thousand songs on their Ipod. They didn’t pay for a single one. How long do you expect people to pay for something that they can get for free. To top it off, much of this free music is easier to deal with than the stuff you have to pay for. Free, simpler and more convenient, V.S. x dollars a month/download/per play.
What I can’t understand is why would someone even start a business selling something people can get for free. But then again I drink tap water and avoid NYC’s toll bridges.