Music On microSD: I Can’t Believe the Labels Fell for This

Forget buying an album on a USB stick, SanDisk (SNDK) just convinced the big labels to release (DRM free, thankfully) music on a 1 GB 15mm x 11mm x 1mm microSD card. And then they convinced Best Buy and Walmart to sell these things. Check out slotMusic for more.

I wish wish wish I could see the power point presentation SanDisk used to pitch everyone on the idea.

The New York Times says a source puts the album price at $7-$10, which is amazing given that the retail price of the SanDisk microSD card alone is currently about $8.50. Included with every purchase is a USB converter, which adds more to the price. Sure, profit margin is built into that price, but it still doesn’t leave much for the labels. My suspicion is the price will be higher, perhaps even more than actual CDs.

USB drives seem like a much more reasonable way to distribute music. All computers support USB, and they’re a lot harder to lose than a fingernail sized flash drive. But the people behind slotMusic are betting that mobile phones, many of which have microSD slots, will drive sales. Buy the album at Walmart and listen to it as you leave the store.

Except that won’t happen, since free on-demand streaming music is also available many phones with a browser through services like iMeem and, later this week, MySpace Music. Hell, I can watch virtually any music video ever recorded with my iPhone on Youtube in about three clicks. A much better business model is to sell mobile users the song as a download if they like the stream, or an even higher-margin ringtone.

Get one of these while they last, because they’ll be collectors items by this time next year. The future of music is free streaming and (also free, eventually) downloads, not physical media.

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Comments

[MrGoodtunes:]

Michael, your $8.50 for 1 gig microSD is high. Look here:
tinyurl.com/49d2j2
and you'll see the current price at Amazon for twice as much, 2 gigs for $1.59, which is more like the actual retail price and still above actual cost for manufacture. And let's face it, it's probably easier for the average CD buyer to rip songs from CD as it is to rip from microSD. And, when a song costs less than a buck, why bother stealing music?

2008 Sep 22 09:13 AM