Friday, October 12, 2007

Universal Music to Take the Reins - But Can they Reign?

BusinessWeek breaks more details on Universal's plans to try and wretch the power back from Apple. Basically, they want to build a consortium (comprised of the major labels) to launch a new tweaked model of music subscription service.

Universal Music Takes on iTunes: "While the details are in flux, insiders say Morris & Co. have an intriguing business model: get hardware makers or cell carriers to absorb the cost of a roughly $5-per-month subscription fee so consumers get a device with all-you-can-eat music that's essentially free. Music companies would collect the subscription fee, while hardware makers theoretically would move many more players."

This feels a bit like Microsoft telling all their device and subscription/DRM partners, "we're tired of waiting for you guys to make a market, get out of the way and we will do it ourselves". Now that frustration has moved further up the chain and the world's largest record label is saying, "I'm watching my business go down the drain and a guy in black mock turtleneck has got me over a barrel - get out of the way, we will do it ourselves".

Questions? Sure, I've got a few...

Q. What about the indies? How bad are they screwed in this scenario?

Q. DRM? I sure as hell hope not. If it doesn't play on iPods and iPhones, it doesn't play.

Q. How quickly does Napster and Rhapsody America bleed customers if this happens?

Q. Pressplay and MusicNet... anyone remember the fate of those major label subscription consortiums?

Q. Will they expose APIs so that they can syndicate this content everywhere, or are they going to drag everyone to a central "store"?

I'm sure I will have more thoughts on this over the coming days. What do you guys think?


Netvalar said...

Well with all the benefits out there to for the Indies to distribute thier music the major labels can do whatever and effect Indies very little. Syndication of music is still a very legal touchy scenerio and I feel the major labels won't do anything to help in that regards. In this day and age it is all about access to the most catalogues and it is becoming a better business deal to work with Indies for this instead of majors. I say good luck to them though.

Anonymous said...

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