| After more than a year of false starts, the commercial online music services may be finally ready to rock. As AOL finally readies the launch of its online music service, other commercial Web players such as Pressplay, Full Audio and Listen.com’s Rhapsody are rolling out new interfaces and planning marketing campaigns in the hopes of convincing consumers that it’s better to pay for music than steal it.
THE COMMERCIAL ONLINE music business could get a boost in its profile if AOL finally launches its subscription song service later this month or early next month, according to people familiar with the situation.
The online service is a backer of MusicNet, owned by Real Networks, AOL’s Warner Music Group, BMG Entertainment and EMI Recorded Music, which rolled out on RealOne Music in December 2001.
AOL has long planned to include MusicNet as a premium offering to its huge subscriber base, but held off until the service overcame technical problems and became more flexible in the way consumers could use the service such as allowing people to buy and “burn” songs. (Burning refers is the process of copying a downloaded track to a recordable CD, which can then be played on any CD player.)
AOL plans to offer three tiers of the service, called MusicNet on AOL, to members: a basic tier would allow people to listen to streaming music and download a select number of songs; a more expensive tier would allow unlimited downloads; and a tier including unlimited downloads and CD-burning, sources say.
An AOL spokesperson would only say that the company is “on track” to launch the music service this quarter.
It’s unclear how AOL will market the service to its dial-up members — streaming digital music sounds best through a high-speed Internet connection — but the arrival of a mass market player could go a long way in educating mainstream consumers about legitimate digital music and, as a result, grow the burgeoning market, industry sources say.
“We need AOL to lead the market,” said Seth Oster, spokesman for Pressplay, the joint venture of Vivendi Universal and Sony Corp. “We want other other strong players to succeed.”
Since launching in late 2001 the various subscription music services have vastly expanded their song databases to include artists from most, if not all, of the 5 big recording labels as well as many independent companies. They’ve loosened restrictions, allowing unlimited downloads, CD-burning or the ability to transfer songs to portable devices.
But they’ve had little luck in attracting big numbers of paying customers or wooing the tens of millions of mostly young people who use the free, unauthorized networks like KaZaa.
There’s no accurate subscriber counts, but research analysts estimate anywhere from a total of 300,000 to 500,000 people are paying for music services on the Web.
Now the legit services are making some some aggressive moves to get people to subscribe and buy songs online.
On Thursday, Listen.com’s Rhapsody, an independent Internet service, cut the cost to buy and burn a music track from 99 cents to 49 cents as part of a 6-week promotion to win new subscribers. Customers need to to subscribe to Rhapsody, which charges $9.95 a month (after a 3-month trial at $4.95 a month). Rhapsody is also offering a free trial until Feb. 21, although people who want to buy the 49 cent tracks need to subscribe. Rhapsody subscribers get access to an unlimited number of restricted song downloads (meaning they can’t be transferred to portable devices) and 50 programmed radio stations.
“For the market to move forward, we need to clearly establish the value proposition,” said Rhapsody spokesman Matt Graves. “This promotion is one way to do it.”
Starting tomorrow, Pressplay will launch Version 2.5 of its service, adding interactive radio features and Billboard charts dating back to 1955. Pressplay charges $9.95 a month for unlimited streaming and downloads and $17.95 a month for unlimited CD-burning.
And in March, Full Audio, an independent music service distributed by Charter Communications, Earthlink and Microsoft, will roll out a new “channel-centric” interface that bring more of a personality and attitude to the service by letting users select categories of music that most interest them, company executives said. (MSNBC is a Microsoft-NBC joint venture.)
“All the digital music services are still oriented around a database paradigm,” said Full Audio’s chief executive Scott Kaufman. “We’re putting the human element in to connect with individual listeners.”
Like the others, Full Audio doesn’t disclose its subscriber numbers, but its customers tend to be older (average age 44 years) and salaried professionals, “the demographic that will initially drive growth of paid online music,” said Kaufman.
Analysts who have been critical of the commercial music services’ earlier efforts say the price promotions and new features are good news for consumers.
“The services are becoming more aggressive about figuring out what features and pricing works,” said McNealy.
The tweaks and improvements to the legit music services come as the recording industry intensifies its anti-piracy campaign. The music industry is suffering a painful decline in CD sales and revenues, blaming digital piracy as the primary reason for the drop.
The International Federation of the Phonographic Industry, a global trade group representing the major labels, said it had begun warning large companies in the U.S., Europe and Asia that employees are are illegally downloading music on company time. Recently Verizon Communications moved to block a federal judge’s ruling that it turn over the name of an individual subscriber accused of illegally downloading music.
But even with a threatened piracy crackdown, there’s still a challenge to convince music fans to try the online services.
“They’re getting a lot better,” wrote Jupiter Research analyst Lee Black in an e-mail. “But they have done little thus far to position their value against file-sharing services, such as their reliable downloads, accurate song information, no advertising and virus-free services.”
Pressplay’s goal this year is to begin marketing the service offline, in addition to boosting its programming content, said Oster. “We need to tell our story that not only are there legitimate online music services, but they offer quality, reliability and are worth paying for,” he said.
Source: MSNBC | |
