22 August 2011
Looking at online music sites with a Magnifier
Back in January, I was quoted on whether online music businesses could ever turn a profit for Media Week. I said at the time, the one to watch is YouTube... and well, in the last week Google launched Magnifier - it's new music discovery service. Magnifier works with Music Beta, Google's cloud based platform that allows you to upload your music collection and access it from any computer or Android phone. Awesome. It almost makes me want to switch from Apple to Android… almost.
Magnifier will not only introduce the user to new music, but it is also giving away free music every day that can be added to your Music Beta profile.
If Google can combine this with videos and live events… well… I bet Apple is already Ping'ing its team together to figure out a plan of attack.
Here's the comment I supplied to Media Week… keeping in mind that Spotify hadn't yet officially launched stateside. What are your thoughts on online music services? It's hot territory, and I'm keen to see what the rest of 2011 brings!
The one to watch is YouTube. They have the music video space absolutely cornered, and they have also added a music discovery and playlist feature, which makes for a killer combination. It doesn’t have the recommendation quality of Last.fm for example, but its very early days and it will undoubtedly improve with Google’s technology behind it. They also have offline element and video arm sorted – for example, the new partnership with Sundance Film Festival to make rental movies of Sundance festivals.
It would be tempting to say that the slick Swedish Spotify has the best business model to succeed, after all it claims to have more than 500,000 premium (paying) users at £120 per year per subscriber. However, Spotify doesn’t sit in the market alone, and it doesn’t sit in the US market at all – in fact, it’s goal posts of when it’s going to launch stateside has been moving around for years and was beaten to the punch by Rdio – a start up by the founders of Skype and Kazaa.
Spotify’s business model, with premium, unlimited and open models is sound, and something replicated by Rdo in the US (minus the open model), so both potentially have the ingredients for success and longevity. To be truly successful though, online music businesses need to look to a model that allows them to meet other needs of listeners, such as real world live events, exclusive content and offers and rewards.
If iTunes decided to allow streaming in the same way (outside of being able to stream radio as you can now), then others such as Last.fm, Spotify, We7 and Rdio would be in trouble. They not only have the most popular device, but they have the live event and capability to scale with the weight of the Apple brand.
Image credit: Magnifier
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