MobHappy

Ringtones Are Not Mobile Music, and Vice Versa

A BusinessWeek article about rap group Public Enemy was in my RSS reader this morning, its description saying "The hip-hop group sees wireless music as a way to air its radical views -- and make a little money". The group's Chuck D has been involved in digital music for a long time, through the Rapstation site and other efforts, so I thought Public Enemy might be up to something interesting.

If they are, they didn't share it with BusinessWeek. Apparently they've got an album that's been out for a while, and this week -- get this -- they'll sell ringtones from it. Even taking into account BusinessWeek's generalist focus, passing this off as innovation in mobile music is a bit over the top.

Part of the reason that mobile music has failed to take off quickly has been that people with vested interests blur the definition of what it is. Ringtones may be musical, and they may be played on a mobile device, but ringtones aren't mobile music. And mobile music isn't ringtones. It's more than a question of semantics, it's an issue of purpose. Music is entertainment; ringtones are expression. Kids don't buy ringtones just because they like they way they sound, they buy them because of what they say -- messages like "look, I'm cool, I've got this ringtone like the other kids", or "look, I'm cool, I've got this unique ringtone".

Blurring the two causes problems: take, for instance, Sprint's recently launched music store, which delivers full tracks to phones for $2.50 each. Some people justify the price by saying people will pay a premium for being able to download songs anytime, anywhere, then finish it off by saying, well, if they pay $2.50 or more for a 30-second ringtone, $2.50 for a full track is a bargain. It's hardly a bargain with the standard going rate for PC downloads at 99 cents per song, and $2.50 per track makes $18 CDs look cheap.

But it's not a bargain when you consider the premium price of a ringtone over a PC download is for the personalization aspect -- in essence, it's more valuable to many people to project an image about themselves than to entertain themselves with a song. Treating mobile music in the same regard as ringtones won't work, nor will basing the price of one on the other. They're both musical, yes, but thinking of them as similar media with similar uses and similar goals will result in failure.

Apple Could Sell 10 million nanos in Q4, Report Says

The latest fuel for the nano-ROKR fire: a research note from an investment bank saying that Apple might sell 10 million iPod nanos in the fourth quarter of the year. This is based on information it's gotten about Apple's nano build orders for the quarter, which exceed 10 million.

Makes you wonder what the estimates for ROKR sales are...

More Musical Greed

One of the most innovative online music initiatives in recent times, has been the subscription model. Services like (new) Napster, Yahoo and Rhapsody offer you as much music as you can cram onto your hard drive for a fixed monthly subscription of between $5 and $9.95 a month - provided you keep paying your subscription.

I'm not going in to the pros and cons of subscribing vs "owning" (whatever that means these days), as both models have their supporters. Not as many as them that support, "free" but you can't have everything.

But whatever you think of subscription, it does seem that the music industry should be praised for once, for allowing something new to happen and exploring new business models.

But then greed has kicked in, rather predictably. The arrangement under which these services have been working is only a temporary one - in place since 2001.

By way of comparison, the deal that the National Music Publishers Association (NMPA) agreed to charge for Internet Radio is 5.25%. The deal agreed for downloads is 8.5%. The deal that they've proposed to the Digital Media Association (DiMA), which represents the main subscription companies is .......17% of revenues - double that they levy for downloads.

I suppose you could argue (and I'm sure they are) that in the case of a smaller pie, they want a bigger slice. But what about the companies who have gone out and created the market in the first place and handle all the tech, billing and the customers? In other words, the real wealth creators in the value chain.

Talks have broken down now, after DiMA counter-offered 6.9% of revenues, which is a very wide difference.

So what's next? The NMPA must think that they have Yahoo et al over a barrel, as now they've launched the service, it would be difficult to withdraw it, both from customer care and an investment write-off point of view.

It needs someone over at the NMPA to think big, long term and in the spirit of partnership and interests of their members to rescue this. But my take-out is that if you try to do a deal with people who treat partners like this, don't launch something on the basis of a temporary deal.

Source: CNet News