last100 » Warner Music

Vodafone Music’s DRM-free move makes Apple and Nokia look bad

Steve O'Hear — Thu, 12 Mar 2009 15:08:13 +0000

Vodafone, which currently operates music download stores in over 20 countries, is to become the latest company to jump on the DRM-free bandwagon, announcing this week that it will soon be transitioning its music catalog away from the copy-protected WMA format to standard MP3s. Additionally, customers will be able to covert their existing Vodafone purchases to DRM-free versions at no extra charge, unlike Apple’s current iTunes arrangement where users wishing to ‘upgrade’ are effectively asked to pay twice.

That’s the good news as far as Vodafone is concerned. The bad: only three of the four major record labels are on board – Universal Music Group, Sony Music and EMI – with Warner, for now at least, refusing to join in the fun, and the whole DRM-free deal only applies to a la carte downloads not Vodafone’s MusicStation all-you-can eat subscription service.

Although DRM-free music downloads via the PC are just about the norm these days, until recently the majority of ‘over-the-air’ mobile offerings still employed some form of copy-protection technology. How times are changing. AmazonMP3 was recently chosen as the default music store on the T-Mobile G1, the first device running the Google-led Android mobile operating system, and the e-tailer has a similar arrangement with Palm for its upcoming Pre smartphone. Meanwhile, in January Apple’s iTunes Store completed its lengthy transition to a DRM-free format, including adding 3G ‘over-the-air’ music downloads to the iPhone sans DRM.

Nokia missing in action

As a side note: all of this DRM-free love is making Nokia look decidedly out of touch. Just yesterday, the handset maker announced that its music download store and ambitious ‘Comes With Music’ (CwM) all-you-can-eat subscription service is rapidly expanding to include more countries and support on three new music-focused phones, yet both the Nokia Music Store and CwM heavily rely on DRM. Although copy-protection technology is probably a necessary evil for CwM, at the insistence of the major record labels who, along with Nokia, are nervously moving into very new territory, for a la carte downloads it just doesn’t make sense. Until the Nokia Music Store drops DRM, I suspect more tech-savvy customers will continue to shop elsewhere, even if that means putting up with the inconvenience of ’side-loading’ music to their phone via a PC.

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A year after launch, free music service Qtrax has all four majors but questions remain

Steve O'Hear — Thu, 12 Feb 2009 13:29:21 +0000

Twelve months ago, free ad-supported music download service Qtrax launched in a blaze of controversy, most notably claiming it had support from all four major record labels, which was news to them. Qtrax is going after the holy grail of music, free and legal downloads, and so it wasn’t surprising that the company faced a licensing uphill battle. A year later and all the “t”s have been crossed and the “i”s dotted: EMI, Warner, Sony BMG and Universal Music are on board, reports AP, and a relaunch is planned for next month. However, a few questions remain.

At the original launch, Qtrax claimed that the service would support the iPod, which sounded like pie in the sky since Apple doesn’t license its copy-protection technology to third-parties, and the Qtrax proposition in heavily reliant on DRM. Users need to be connected to the Internet to authorize the tracks they play, as well as ‘phone home’ other data such as play count in order for the labels (and artists) to be compensated fairly from the pool of available ad revenue. The AP article makes mention of iPod support still being on the cards. Baloney.

Beyond iPods, Qtrax says that a large number of smartphones and mp3 players are supported — users can transfer downloaded tracks to said devices but they’ll need to re-sync them once a month in order to see advertisements and send back that crucial listening data. However, no where on the site can I find which mobile devices are compatible, aside from mentions of Windows Media DRM.

There’s also the question of whether Qtrax’s necessary but kludgy approach really has reached the holy grail as it introduces a level of inconvenience that may turn users away. Instead, ad-supported streaming services, with no download required, might have a better future. Especially as Internet access – even on the go – becomes increasingly ubiquitous.

And then there’s that advertising pot. Will it be bigger enough to satisfy the majors in the long term? Qtrax doesn’t feature audio ads but banners only, which I suspect won’t command a very high rate.

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We7 signs Warner Music for ad-supported streaming and MP3 downloads

Steve O'Hear — Thu, 14 Aug 2008 15:02:39 +0000

Why are ad-supported models such a hard sell to the major record labels? “It’s simple”, answered Steve Purdham CEO of We7 in a recent interview with last100. “They are worried that if they leave the iTunes model, the revenues they get will be diminished”.

At the time, Purdham’s company, which offers ad-supported streaming and downloads, didn’t have a single major on board. That was just over six months ago, and how things have moved on.

In early March, We7 unveiled its first major label partner, Sony BMG, to offer free streaming of its music catalog to We7 users in the UK. And just today the company announced a partnership with a second major label: Warner Music UK.

The Warner agreement is two-fold, covering on-demand streaming (ad-supported), supplemented by full paid-for MP3 downloads. “We7 users will be able to listen to full tracks and albums on an unlimited basis at no cost, and also create playlists, share their favourites and embed songs into their personal webspace”, according to the press release. In return for this all this freeness, users will have to listen to short, targeted audio adverts before each streamed track.

Alternatively, for an ad-free experience users can opt to purchase any Warner track outright via We7’s integrated download store, similar to the current arrangement with Sony BMG. Tracks are to be offered in the MP3 format, compatible with virtually any digital music player including iPods. Aside from individual songs, We7 and Warner will also offer “album bundles with additional tracks, videos and interactive booklets.” Warner Music’s content should be available on We7 before the end of October.

It seems that Warner’s deal with We7 is more evidence of that the major label is willing to experiment with new business models. After starting legal action against another ad-supported music service, U.S.-based imeem, in May 2007, Warner Music Group dropped the lawsuit two months later in favor of a “strategic partnership”. More recently, the company announced that it had signed onto Nokia’s forthcoming all-you-can-eat music subscription service, “Comes With Music“.

Disclaimer: We7 was recently a last100 sponsor.

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Warner Music jumps on-board Nokia’s all-you-can-eat music plan

Steve O'Hear — Tue, 01 Jul 2008 12:07:06 +0000

Three down, one to go

Nokia continues to cozy up to the music industry, announcing today that Warner Music has signed onto ‘Comes With Music’, the company’s all-you-can-eat music subscription plan. The major recording label becomes the third of the Big Four to have agreed a partnership with Nokia, following earlier deals with Universal Music and Sony BMG. The remaining major holdout is EMI.

Announced last December at the annual Nokia World conference, “Comes With Music” will enable customers to buy a Nokia device with a year of unlimited access to “millions of tracks”, and – rather surprisingly – get to keep any downloaded tracks once the twelve month subscription period ends. The only way to then continue accessing the service, however, is to purchase a new “Comes With Music” device (see our follow-up report).

In a press release, Edgar Bronfman, Jr., Warner Music Group’s Chairman and CEO described ‘Comes With Music’ as “the first global initiative to fundamentally align the interests of music companies with telecommunications companies… Through this innovative service and business model, all parties are equally driven to create the best and most comprehensive music offering designed to meet the ever-expanding consumer appetite for music and music-enabled devices.”

While Nokia’s Tero Ojanperä says: “Comes With Music enables people to access great content, provides artists to wider exposure with new and existing fans, and creates new revenue for all stakeholders.”

On the issue of exactly how much new revenue Nokia is generating for the major labels, the company isn’t giving much away – and why would it? Amid reports that Nokia may actually be prepared to lose money on ‘Comes With Music’ in return for securing the major labels’ support and aggressively entering this new market, the company’s music boss Liz Schimel told Reuters back in April: “I can assure you that we are looking out for everyone’s interests in creating these new business models, including our own.”

‘Comes With Music’ is expected to launch in the second half of 2008 on a range of Nokia devices in “selected territories”.

Nokia also announced today that Warner Music is making its catalog available to the Nokia Music Store, the company’s “over-the-air” and PC-based a la carte music download service (see last100 coverage).

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Wal-Mart ditches DRM at a cost

Steve O'Hear — Tue, 08 Apr 2008 13:49:59 +0000

When Wal-Mart first starting selling DRM-free music through its online store, we had one major complaint. Alongside those iPod-friendly MP3s from EMI and Universal Music, sat copy-protected tracks from the two remaining major labels that were only compatible with PCs running Windows and supported PlayForSure devices. A sure way to confuse customers and create a very poor shopping experience, we concluded.

Along with a redesign of the Wal-Mart online music store, the “world’s largest retailer” has finally ditched DRM completely but at a cost. Rather than successfully negotiating licensing deals with the DRM-free holdouts – Sony BMG and Warner Music – Wal-Mart has sacrificed music from those two labels completely (tracks from Sony BMG’s Neil Diamond seem to be the exception, reports Wired).

So why has Wal-Mart relaunched its online music store – DRM-free – without waiting till it could offer music from all four major labels? As Insanely Great Mac notes, the retailer is likely holding out for much more favorable terms, and by relaunching early is calling Sony BMG and Warner’s bluff. The majors are renown for demanding very favorable terms, which often involve substantial upfront costs and/or equity. If you’ve ever wondered why iTunes doesn’t carry DRM-free tracks from all four major labels (yet), there lies your answer.

Aside from having a half full catalog, the new Wal-Mart online music store still suffers from another major demon: the site requires Windows Internet Explorer running on XP or Vista — no Mac or Linux customers allowed.

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What’s next? Madonna in my corn flakes?

Daniel Langendorf — Tue, 08 Apr 2008 01:31:37 +0000

Record labels sure seem desperate these days to get their music in your hands any way they can. What’s next? Free music in your corn flakes?

Samsung, the No. 2 mobile handset maker, has signed a deal with Warner Music that will put Madonna’s upcoming album “Hard Candy” and video for the single “4 Minutes” preloaded on its F400 music phone.

Granted, the F400 comes with Bang & Olufsen speakers, but come on. What will any of the players gain here?

Will Madonna sell more Samsung F400 phones?

Will Warner Music sell more Madonna (or music from its catalog) just because it’s on the latest Samsung music phone?

Will Madonna sell more albums and ancillary content because she’s so cutting-edge mobile?

What’s Madonna demographics these days anyway? Aging pop fans with disposable income willing to buy yet another cell phone? Do the world’s youth even care about the Material Girl, even if she does say this next album “will kick your ass?”

In case you are one who does care, Madonna’s “Hard Candy” will be released April 29 — and the F400 is already available in the U.S. The F400 will be released in “early June” in France.

In other markets, carrier Vodafone and Warner Music have an arrangement that will make the new music and other content from “Hard Candy” available exclusively to Vodafone mobile customers prior to its general release.

But don’t expect Madonna in your corn flakes. At least not yet.

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