Mobile Music Announcements
a look at the avalanche of recent announcements
11/08/2004 by Leigh Phillips
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In the two weeks since Apple announced it was working with Motorola to develop some so-far-extremely-light-on-the-details digital music player/mobile handset hybrid, it seems like virtually every other major European stakeholder in the mobile sector -both operators and handset manufacturers - has said: "Me too! Me too!", announcing their own vision of the mobile music future.
And no wonder, market research group IDC recently predicted that revenues from mobile music will rapidly grow to �7bn in 2005, making music the second largest mobile data revenue category after information services. On the other hand, another market research group, the UK's Ovum, reckons mobile music downloads (excluding ring-tones, streaming and other mobile music formats) will only grow to �800m by 2008.
As there were two such announcements today alone, we thought we'd do you all a small service and give you a brief recap of the announcements in recent days.
Ericsson, TeliaSonera, and Sony
TeliaSonera Sweden announced on Tuesday its M-USE service, developed by Ericsson in cooperation with Sony Music, available via TeliaSonera's Swedish mobile service Telia Go.
The service allows users to download original music recordings as real-tones, polyphonic ring-tones, and music clips from the Sony Music and Warner Music catalogues. The service also offers an Amazon-style personalisation feature that suggests other music the user might like, and in the press release announcing the service, the companies noted that local as well as international content was expected to be a selling point.
Ericsson takes the overall responsibility for the music service, including content aggregation, digital rights management (DRM) and platform development. The service is integrated, hosted and managed by Ericsson.
Meanwhile, in June, TeliaSonera in Finland launched Sony's StreamMan music service (server technology provided by Alcatel). As with audio streaming to PCs, the service sends music to handsets over the mobile network. The Nokia 6600, the Ericsson P800 and Ericsson P900 are the first handsets that are compatible with this service.
Important to note here is the fact that this, so far, is a fairly minimal offering, and yet, as Sony has in recent weeks announced it's 'iPod killer', the Networked Walkman Hard Disc 1 (NW-HD1 - with a 20GB capacity, which, when using Atrac3 Plus at 48 Kbps encoding, can store 13,000 songs - 3000 more than the 40GB top-of-the-range iPod), the company has clearly set its sights on Apple and portable digital music. The NW-HD1, the Walkman brand, the Sony Music catalogue and Sony's partnership in Sony Ericsson are a natural combination. Expect some Sony Ericsson one-upmanship over the Apple-Motorola announcement sooner rather than later.
O2, MTV
O2 Ireland announced today its own vision for the mobile music future: music downloadable over the O2 network, but storable on a separate digital music player device - the first mobile music service in the country.
The new service enables customers to select, retrieve and store music via their GPRS-enabled mobile handset onto a specially designed digital music player, or DMP. O2 has signed up the Warner, Universal and BMG record labels, as well as the Association of Independent Music (AIM) the alliance of independent UK record labels. This is notable in that independent music makes up a much larger proportion of European record sales than it does of American sales, and Apple, which has so far largely hit every digital music target it has aimed at, made the mistake of launching its European iTunes operation before ensuring it had indie musicians on board. O2 hasn't repeated that error. Further record companies are expected to come online in the coming months.
Customers connect the digital music player to their handset via infrared, and select the 'get new music' option to view a menu of track listings. Customers then select a track and choose to either hear a free 30-second clip or purchase the entire track. The track can be listened to as it is downloading and once it has been downloaded the digital music player can be unclipped from the mobile handset and used as a regular personal music device. Up to 70 tracks can be stored on the 64MB memory card for as long as they are required, and customers may choose to download the music files to their data card, which can then be transferred to a PC for additional storage. Customers can also purchase additional memory cards.
Although pricey at �299 for the DMP, especially for a DMP that can only store 70 songs, the choice to make the tracks transferable to any other device, via a PC, is exactly what consumers want. They'll pay for digital music, but they want to be able to play it wherever they want when they own it. Furthermore, the tracks cost approximately �1.50 to download - perhaps a perfect price point for mobile music. Only slightly more expensive than a track from any of the PC-oriented music download sites, the price reflects the premium people are willing to pay to be able to download any song they want on the spur of the moment while on the move. You're in a store and you hear a song you like? You don't have to wait to get home to download it. You're at the beach and you think a Manu Chao song would go just perfectly right now? Go ahead and download it.
Smarter still, is the partnership with MTV - the brand, ne plus ultra, of youth and music. Exactly what this means in practice, and what synergies result remains to be seen.
The service will be available in Ireland, the UK and Germany sometime this year.
Nokia, Loudeye
B2B digital media solutions provider Loudeye announced this week a multi-year agreement with Nokia to develop an advanced wireless digital music platform for mobile operators worldwide.
This agreement includes a multi-million dollar commitment to Loudeye for development fees and defines a global collaboration framework between the companies. Additional details regarding the collaboration, as well as the platform and its availability, will be announced at a later date.
Of course, what we have here is the fact that while Nokia and Loudeye have absolutely nothing anywhere near being ready to announce, in a week of announcements they had to say something. Loudeye recently bought OD2, the financially troubled white-label music download store that services the online music shops of a number European brands, including Coca-Cola, HMV and Tiscali. Nokia, of course, is the global handset leader, so expect some fairly major handset announcement in the coming months. The main concern of mobile operators with the Apple-Motorola deal is that the Motorola handsets will allow the uploading of iTunes tracks directly from the PC to the handset, bypassing the operators completely. Will Nokia go down the same road, allowing the upload of tracks from OD2 sites to the handset via the PC, or will Nokia be more friendly to the operators, along the lines of O2's DMP?
Hutch 3G UK
Going one step beyond, but not necessarily with a service that matches the iPod-esque zeitgeist, UK 3G mobile operator Hutchison 3G UK, branded as "Three", announced last week that it had teamed up with record company BMG to launch a mobile video jukebox enabling Three customers' to stream music videos direct to their video mobiles.
Customers will be able to both watch and hear music video releases four to six weeks in advance of the single launch. With Three's music video chart, customers will be able to choose from around forty, full-length music videos, with up to five new releases going live on the service every week.
Music videos will be priced at �2.30 (�1.50) and will be available to either QuickPlay (stream direct) or to download to the handset and can be played for as long as the customer chooses. Alternatively, customers can buy an Unlimited Entertainment Add-On for �15.18 (�10) per month, which will allow them to access unlimited music and entertainment over the course of a month.
This is an extremely expensive option, and given that the market for buying music videos (on DVD, and before that VHS) is minute compared to audio sales, it is unlikely the kids will be willing to fork over a whopping �2.30 for a video on a handset, especially considering that videos themselves are essentially promotional devices for the music itself. At the same time, Three recently announced a mobile video service whose business model is closer to that of traditional broadcast television, with subscribers being able to access advertising-supported videos for free. Interesting...
Others
T-Mobile in Germany meanwhile launched its Mobile Jukebox in May, which offers 90-second specially edited versions of songs. Currently a maximum of three such songs are storable on the handsets.
In July, Norway's Telenor announced the launch of full-track mobile music download services from mobile media solutions provider Chaoticom. Part of the Telenor djuice suite, the direct-to-mobile music download service enables users to access original full tracks on a wide range of mobile phones running on the Telenor network. Subscribers can listen to their music without interfering with incoming call reception or other calling services.
Orange UK and the Czech Republic's Eurotel have also picked the Chaoticom mobile music service.
And that's it so far, so, despite the summer normally being a cool period for major corporate announcement, summer 2004 has really marked the kick-off for the mobile music sector. It's still very early in the game yet, with a great number of the announcements having only been made in the last few days in reaction to the Apple-Motorola bombshell. None of the business models are set in stone, and are all very different from each other.
The field is wide open.
Digital Media Europe: Features & Editorials - Mobile music - a look at the avalanche of recent announcements
Posted by Craig at August 12, 2004 02:28 PM