Will Today's Music Fans Buy What Nokia Is Selling?

Nokia (NOK) now has three of the Big Four labels signed on for its upcoming “Comes With Music” service, which is expected to launch later this year. EMI hasn’t signed up yet, but apparently it is planning to. Although the terms of the deals are unknown, Nokia has reportedly paid the record companies millions of dollars for the right to offer some of its songs for download, and will build some of that cost into the price of Nokia handsets. Not surprisingly, Warner (WMG) boss Edgar Bronfman Jr. is full of visionary enthusiasm for the project:

Nokia’s Comes With Music service will be a significant step forward in the evolution of digital music. It’s the first global initiative to fundamentally align the interests of music companies with telecommunications companies.

Who knows, maybe this time all of Edgar Jr.’s pronouncements about a revolutionary step in digital media will actually come true — unlike, say, his similar pronouncements about the benefits of a merger between Seagram and French media conglomerate Vivendi (VIVEF.PK), a deal that would eventually vaporize billions of dollars in shareholder value, along with a substantial chunk of his Montreal-based family fortune. But let’s not dwell on that. And I’m also not going to mention how Edgar has repeatedly pledged that he has “gotten religion” about the need for progress in the music industry, only to repeatedly demonstrate the exact opposite whenever it comes time to actually do something.

In any case, I think the hoopla about 'Comes With Music' is misplaced, for a number of reasons — but the biggest is the fact that the music streaming through those Nokia handsets will still be effectively crippled or handcuffed in some of the usual ways. While users will be able to download the songs to a PC, and (in what I admit is a fairly revolutionary move) will be able to continue listening to them after the year-long deal is over, they won’t be able to burn them to a CD without paying extra, and won’t be able to move them to a portable player at all.

In other words, the labels are doing their darndest to move the clock backwards, and they clearly see mobile handsets as one way of accomplishing that. A decade or so ago, this would be like Warner signing a deal with Panasonic to offer music through the company’s stereo receivers, but forcing you to pay extra if you want to record that music on a cassette tape to play in your Walkman. Oh, and after the year-long deal expires, you have to buy a new stereo — er, Nokia handset — in order to get access to any new music through the service.

Will the new generation of music fans buy what Nokia is selling? I could be wrong, but I don’t see that happening.

Disclosure: None

Comments

[bbzz24]

so if i get it right use nokias on ebay will be sold as 'comes without music'. that still is a marketing strategy.

[tenoce]

I don't know what is the case in the more developed countries, but I have here a market research done by Coca Cola's Fanta brand about the youth attitude towards the music consumption in Hungary (Fanta Trend Report).
It says that 93% of the youth consumes music through MP3, and only 52% via CD's. Again, note that Hungary is less developed than WE or US! This for me would mean, that the MP3 rate would be even higher in those regions. This also means, that today's does not need the CD burning capability. They will use the digitized music only, and skip the CD. What Nokia needs is to have more and more consumer electronic companies to build a hardware ecosystem around its phones (receivers, docking stations, etc. compatible with the phone music playing capabilities) like Apple did it around its iTunes-iPod portfolio.

[K. Lewis]

This appears to be another attempt make money by selling something people aren't buying. Why is it so impossible for the media companies to just look at how people are consuming their products and build a paid, open alternative to the folks who'd rather not steal?

Access to an infinite, open, media library is ALREADY there if I want to illegally download the content. The big media companies simply need to build the store where the people already shop, so to speak.

[tenoce]

Because, as one of the main principles of mainstream economy says: Due to the mankind's mentality, there will be always waste. Should there be "an infinite, open, media library", people would misuse it. That is why subscription based services could give a good "Golden Middle". However due to the before mentioned attitude, this can be only introduced with some additional limitation (DRM). Otherwise it would not work.
As communism could not work either.