This article in Business Week gives some really interesting insights into where the digital music market is likely to go over the next year or so. Analysts have been tipping subscription based services as being the next big thing. This isn't being supported by the reality yet. None of the existing subscription services from Real, Yahoo or Napster have really taken off in a way that suggests they will challenge iTunes dominance.

There is still a hot debate on "rent vs buy" that continues around subscription services. There was a similar debate a few years ago about whether anyone would pay for digital music. I still believe that in the same way that the iPod and iTunes took paid downloads into the mainstream, the service that will do the same for subscriptions has yet to arrive. If the above article is correct, it won't be another service from Apple that does this, unless Google or Amazon gets into the market.

I think that they are all missing the point slightly. The issue with the subscription services is not in who is offering them, how much they cost or even in the fact that you never own the music. It is how they are bundled and billed for. A standalone music rental service is too expensive for all but the most avid music fan. In my opinion, the killer music subscription service is going to come bundled with other entertainment. It might also be a "family" style service rather than being aimed at individuals.

The cable operators need to offer a bundled entertainment service where you pay for the music subscription in the same way that you pay for channel packages. Satellite channels can't do this because they don't offer fast web connectivity to the box.

Most of the next generation set top boxes will effectively be computers with USB or equivalent connectivity out of them so you can load up your MP3 player with music, video or anything else. The beauty of this solution is that it is entertainment focused and you don't even need a PC. I don't think that this will happen immediately. The roll out of the set top boxes itself will take a long time. However, if I worked for any of the major labels, I'd be courting that kind of service as a good long term revenue stream. 

What do you think? Would that kind of service interest you?

A good point but surely we are in fact moving to a model whereby the device is agnostic and the actual media is as you rightly say entertainment based rather than media/format based. 
With the increase in bandwidth for wireless connectivity increasing year on year i feel that eventually we will all pay for streaming from a central store or remote hosted content platform and be able to connect wherever we are including the home, and listen, watch and search for our entertainment content on our device of choice be it a STB or an iPod or even a multi format gateway device such as the next generation games consoles will be offering. Then no one but the originator would actually own the content but would pay by the "stream" rather than pay by the file. All we need is for someone to create a file agnostic search and streaming service utilising a similar idea as RSS and then you access them and pull whatever content you wish on whatever device you wish. 
And if anyone could add their content to this repository and set their own pricing they would not be at the mercy of the major media owners and could build relevance around like for like communities. Now thats a service i could really see taking off.
Do you agree or do you feel this is all too far away into the future?

On 22:25:32 15 August 2005 JoniMallett wrote:

Hi Giles

Well, well -  it's simply natural progression, is'nt it? Reading the article, I found it funny that Apple, are not diving in there - quoting from the article "Apple seemed unlikely to make a move  until a rival began forging inroads into its music empire". Have they felt the need to cease trendsetting and risk taking?

Personally it's a great idea! Especially for new artists and non commercial music - it opens up so many opportunities for them and for the potential listener. 

I'm sure we have all been in the position of wanting to listen to new music, but not quite 100% sure of whether it's all we reckon its cracked up to be, least this way we can buy a "bundle" of new music, listen to it, and then make that decision of whether we want to own. It beats going into HMV, buying a bundle of CD's, then standing at the refund till the following week, and making up reasons as to why the following CD's were unsuitable to our ears!

Sure, we all want to own, but there is so much new music coming out, and that has been and gone, were does one start when browsing through the millions of titles and artists that are on offer.

On 14:19:24 15 August 2005 GilesBlackburn wrote:

This article in Business Week gives some really interesting insights into where the digital music market is likely to go over the next year or so. Analysts have been tipping subscription based services as being the next big thing. This isn't being supported by the reality yet. None of the existing subscription services from Real, Yahoo or Napster have really taken off in a way that suggests they will challenge iTunes dominance.

There is still a hot debate on "rent vs buy" that continues around subscription services. There was a similar debate a few years ago about whether anyone would pay for digital music. I still believe that in the same way that the iPod and iTunes took paid downloads into the mainstream, the service that will do the same for subscriptions has yet to arrive. If the above article is correct, it won't be another service from Apple that does this, unless Google or Amazon gets into the market.

I think that they are all missing the point slightly. The issue with the subscription services is not in who is offering them, how much they cost or even in the fact that you never own the music. It is how they are bundled and billed for. A standalone music rental service is too expensive for all but the most avid music fan. In my opinion, the killer music subscription service is going to come bundled with other entertainment. It might also be a "family" style service rather than being aimed at individuals.

The cable operators need to offer a bundled entertainment service where you pay for the music subscription in the same way that you pay for channel packages. Satellite channels can't do this because they don't offer fast web connectivity to the box.

Most of the next generation set top boxes will effectively be computers with USB or equivalent connectivity out of them so you can load up your MP3 player with music, video or anything else. The beauty of this solution is that it is entertainment focused and you don't even need a PC. I don't think that this will happen immediately. The roll out of the set top boxes itself will take a long time. However, if I worked for any of the major labels, I'd be courting that kind of service as a good long term revenue stream. 

What do you think? Would that kind of service interest you?

Giles, I notice that some of the satellite music services are become more 'on-demand' right now, so I think it may not be as long as you think.

Of course, a key question is mobile player integration, and that's where the next fight will no doubt turn up: the player market is expanding rapidly, and consumers become less and less technology savvy, and less understanding of things like DRM as you widen the market, so there may well end up being a £25 player (similar to the Shuffle) that integrates directly to such a box, like my iPod does in its dock...