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HMV to Sell Digital Downloads
An anonymous reader writes "Sales of digital music downloads on sites like PressPlay and MusicNet have been a bust so far and for good reason. They cost too much, have too many restrictions and the palette of music you get to download is too limited. They have almost nothing to offer over what the various P2P networks give you for free. So why do record chains like HMV want to get in the game? Simple, these services cut out the middlemen and if they should ever succeed record retailers would be left out in the cold. Research shows there is a percentage of consumers who will pay for digital tunes if the conditions are right. They aren't now, but market forces will push them to improve the terms or die. PressPlay has already capitulated to some of these limitations. To protect their interests in the long term, retailers like HMV and Tower records have jumped on board and signed on with On Demand Distribution (OD2) - a company co-founded by Peter Gabriel to be a wholesaler of digital music tunes - to provide the music and the back end to their new services. HMV's service launches in September at five pounds at month (about 7 bucks), a price point which will mean nothing if the song selection sucks."
Somebody out there actually realizes that the current music business model will eventually fail. How refreshing it is to see intelligence in corporate America once more.
Computer Science is no more about computers than astronomy is about telescopes. --E. W. Dijkstra
I hate the concept of subscription models. All of these services want to rope you into month after month of fees. Everyone from Microsoft to music wants the luxury of a constant income stream.
I don't buy CDs every month, why would I pay to download songs every month? Same goes for software.
Let me come in, buy one or two songs for a buck (and give me my fair use rights to them), and maybe I'll be back in a couple months to spend more.
As it currently stands, the majority of dance/electronic music is only released on vinyl. However the CD dj is no longer a novelty, but the problem arises of finding music on CD. But the current amount of CD dj's don't warrant the need for widespread CD releases. It seems like a PERFECT idea to sell this type of music online, with the intention of people buring the music for their own use. You can't even find much new dance music on P2P networks, so there isn't a whole lot of competition. And I think that many DJ's would jump at this opportunity. You can buy or pirate pop/rock anywhere, but the dance music scene is no where to be found in many american outlets.
Only the meek get pinched. The bold survive.
How is this any different from EMusic, a company that offers entire albums for download at something like $9.99/month?
The World is Yours.
...we do start paying for music like this, and get mp3s in return, and the RIAA comes cruising along the networks and tags us for having "copyrighted content" on our computers?
Feel that power? That's mah MOUSING FINGER
What this means is they are not automatically either RIAA or MPAA friends. Good luck to them.
- Music stored available in multiple standard formats with multiple bit rates: OGG,MP3,FLAC,SHN
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A pricing structure starting at $10/month going up to $30/month based upon bit rates, not the amount of songs you download. At $10/month you only get to download 64kbps mp3's, $15/month for 128, working your way up to $30+/month for flac or shn downloads that are lossless.
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Every CD ever made period.
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Allow transfer to portables and CD's
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An intuitive web interface, instead of building some bulky windows client that does everything your computer already does: CD burning, music manager, etc; just have a well designed web interface that works on all platforms with all browsers.
Now if they can just figure out a way to pay the RIAA and the artists, we will be set!Honestly, I think the part many are missing is the fact that most people still need their music to reside on a physical piece of CD media before they can enjoy listening to it.
This is the real reason behind your statement (and consequently your logic) that you'll opt to go "buy a CD" instead of download a file.
There's an entire infrastructure built around the public listening to their music on compact discs - and no p2p network can change that fact.
The recording industry needs to address this before they begin trying to make money on downloaded MP3 songs!
As I've said many times before, a really good alternative for them would be building computerized kiosks that let the customer burn his/her own selection of songs onto a high-quality CD - and pay for it by the song. (Probably by taking a resultant printed receipt up to the counter/checkout lane with the shiny new disc)
This would eliminate the issue of requiring huge amounts of physical store space to display all the music. (Instead, they might have a tradeoff of a little bit of "back room" space taken up with a server containing all the digital data that makes up the music collection, and some boxes of blank media to reload the kiosk with when it runs out.)
I would think most retails stores would absolutely love this idea, as would consumers who can finally buy their own "custom mix" CDs - instead of paying for songs they don't like/want, just to get a few that they do. By tallying up exactly which songs sell best, the recording industry gets much more accurate feedback of what's "hot" and what's "not", too.
Selling downloaded MP3 music has only very limited appeal in a world where many people don't even own the tools required to move the songs onto media playable in their car/home stereo. (The rest of us do, but we don't always appreciate taking all the time/effort out to do so.)
Speaking as someone who hasn't bought a cd in almost 10 years, I was really suprised when I learned of EMusic. I am a fan of punk, ska & hardcore, and glady pay EMusic $15.00/mo in order to download their vast selection of music in that category. Granted, their other sections lack content, so my girlfriend gets upset when she can't find her newest pop album, but I am rather happy with the selection that they offer me.
I'm not even so concerned with "CD quality" not being good enough. I think it's plenty good enough for me. I know they have newer, improved fornats like DVD-Audio out there now, but they don't particularly interest me. I don't own multi-thousand dollar speakers or even an extremely expensive home stereo receiver, so I doubt it'll be that dramatic an improvement to my ears.
What I *would* like to see, though, is MP3s encoded at 256 bits, or at the very least, 192 bits. These are in very short supply on the free p2p networks, as 99% of people think "128-bit is good enough for me", and seem to value saving a little disk space over the improved quality. I can almost always tell a definite sound quality differnce between 128 bit and 192 bit + encoding. The 128-bit stuff just sounds "dull" or "lifeless" by comparison. You wouldn't necessarily even realize what you were missing if you didn't compare the same song, side-by-side, at both encoding rates -- but once you do, you'll never want 128-bit MP3s again.
Digital music downloads is what's known as a 'Disruptive technology'. Every industry has disruptive technologies that, when they appear, are not as good as what is currently in place, but end up improving to a point where they replace the original sustaining technology.
An example of disruptive technology is the 8" hard drive. The 14" hard drives were fast and stored a lot of data, but few of the disk companies bothered to make 8" drives when they came out because they were slower and didn't store as much data. Not only that, but they cost more per megabyte. But the market for Minicomputers demanded lower cost (even if it was higher cost per meg) overall drives, so they started improving. Only one or two hard drive companies from the 14" market survived the switch to 8" drives because they didn't see the benefit, and their customers didn't either, until it was too late.
The same thing happened again when the 5.25" HDs came out. Only a couple manufacturers of 8" drives stayed in business, and only because they spent money on the 5.25" drives well before they were good enough to sell, or profitable.
Finally, look at the excavating market: Up until the 1940s, steam shovels were all cable activated. They used cables to lift the arms and control the scoop, not hydraulics. When the first hydraulic dirt movers came out, they couldn't move anywhere near as much dirt and they cost more to operate, but eventually they became more powerful, safer, and cheaper to own and operate then cable operated stuff. NONE of the steam shovel companies that were in business in the 1940s survived past the 1950s because they didn't see the benefit of selling what they saw as inferior technology, which hydraulics definately were in the beginning.
This created opportunities for the startups to dominate the small hydraulics market unopposed until they were able to grow into and take over the domain of the cable operated steam shovel.
What HMV (and these other companies) are doing is learning from the mistakes of those companies. Digital music download is a disruptive technology to the sustaining technology of physical music purchase. It's not as high quality as CDs now, and it has lots of deficiencies, but they know that eventually, the market for digital downloads of music may grow to compete with and even replace physical media sales. That's not what customers want right now, but the market and technologies change, so 5-10 years from now, customers will demand this, and whoever is in the business first will have lots of advantages.
Remember, what the customer wants is not always best, and if you spend your life following the customers requests only, you'll eventually go out of business when a disruptive technology appears. It happened to the 14" drive manufacturers who listened to their customers (who weren't interested in slower, lower capacity drives), and it'll happen to the music industry that doesn't embrace and extend downloads.
For more data on this, read 'The Innovators Dilemma' by Christensen.
The downside was the price. I was looking to order some CD's from the "Ultra-Lounge" collection but they were only offered as digital downloads, and the price for the download was actually more than I had paid for some of the CDs from that collection that I had already bought!
If HMV can pull off this pay-for-download feature and actually keep prices good and cheap, then distributors will have good reason to be shaking in their boots. But if prices turn out to be unreasonable, then I'm concerned that HMV will be trying to merely squeeze out distributors while keeping prices unreasonably high.
Remember: right now artists get about 6 to 10 cents per song, up to a maximum of 10 songs, per album that is sold. That means most artists see a maximum of $1 from a CD that sells for over $15. And that's putting it simply: in most record deals with major labels that dollar goes towards recoupable expenses (production costs, legal costs, shipping, manufacturing, the whole bit).
A big price break here could cause consumers to purchase a lot more product, which in the long run is good for consumers and artists, probably works out well for companies like HMV, and the knuckle-dragging major labels will barely be affected at all. So as long as they can stick to offering cheap digital downloads, this is excellent news.
And for the record, I did make heavy use of these machines back in high school. I'd create mix tapes by a dozen bands I was curious about but hadn't yet heard -- the Sugarcubes, let's say -- and come back later to buy full albums by the bands I ended up liking. (Mind you, this was before the popularization of both the Internet and in-store "try-before-you-buy" listening.) Pretty much the same thing a lot of people use Kazaa/Gnutella for today -- a sampler platter. And the labels would opposed a CD-based version for all the same reasons.
Shame, really...
I subscribe to emusic, and have for a long time. Unlimited downloads, mp3 format. It's mostly not major label stuff, which is a good thing for me-- why should I support the RIAA?
The only drawback is sometimes they don't add music as quickly as I wish they would. Still, they've got enough music in there to keep me busy exploring new genres and bands at no risk to me but the downloading and listening time (and their transfer rates are so high that download time is negligible).
Up front admission: I work one of OD2's rivals. So if you like, take what I say with a pinch of salt.
OD's service, as well as ours, does not cut out the middle man. The labels still get paid. OD2 paid the labels for this content (albeit by offering shares in themselves, not with actual cash). The subscription fee you pay does, therefore, filter back to the label. I would be very surprised to see any minor label, let alone any independant band hhave content available.
OD2 are well known within the industry for offering Microsoft formats only (perhaps one of the reasons MSN have choose them to power the MSN downloads.
Their licensing model is a music "rental" scheme. The problem, for slashdot users, is this seems unacceptable to the "technical public". The normal public may well go for this, after all, 99% of people accept the video hire model, why not music hire. However, it is, in my opinion, still too limited. If I am going to pay for access I want more than 25 downloads per month. I'd happily pay £10 pcm for access to all of EMI's back catalogue. Maybe one day EMI will listen and go for it (and preferably use my code base *grin*).
However, the suggestion in the story that "these services cut out the middlemen and if they should ever succeed record retailers would be left out in the cold" is rubbish. The labels provide the music, of course they get paid.
You can get 192 kbit files which sound no better and even worse than 128 kbit MP3 it's all down to the encoders. The latest version of LAME for example produces excellent quality files if you're willing to wait longer for your encoding. I've seen alot of 128Kbit MP3's encoded with intensity stereo which should only be used with 96 kbit or less rates. Also MP3 files tend to lose alot of harmonics regardless of the bitrate used, newer formats seem to do better in this regard. I personally like the sound of OGG and whilst I generally feel WMA sounds worse than MP3 some of files I've heard have sounded very "warm". Finally, 192 kbit is 50% larger and hence will take 50% longer to download and remember there are an awful lot of people who don't have broadband.
This doesn't make any sense at all.
Why would a company sell you a mistitled song? What, somebody's going to stick the CD in and type in "Britney Spears" when it's clearly a Beatles song?
It's simple: You pay $2 for the song. The song is downloaded. Whoops - that's not it - you have a digital reciept showing you paid for the Beatles, and you got Burke Backarack. You email/contact retailer, give sale ID number, they go "Whoops - our bad", and they let you have the one you want. Why? Because they know if they don't, you'll tell your friends how they hosed you, and most companies don't like negative press (especially of a fledgling business model).
Because they want a steady stream of revenue, the odds are greater they'll check the songs they put up for sale to make sure they've got it right. To say they won't is (except for a few human mistakes sure to sneak in), to be honest, just a little silly.
52 Weeks, 52 Religions with John Hummel
All you have to do is play off the weaknesses of the current p2p models and they'd be set. Lord knows their's plenty of them.
1) Consistent high download speeds.
2) What you see is what you get downloads, ie; ensuring their quality (no cracks, loops, hiss, bogus files, etc).
3) Stable downloads. No "need more sources", "qued" and all of that BS.
4) No sideband search traffic or p2p downloaders sucking up my bandwidth.
The only reason why we use p2p is because it's the only option anymore, not because it's good. But to these three, you have to add:
5) Downloaders rights. You pay for a song/subscription, it's yours to copy, burn, etc. Some services erase your archive or it becomes useless if you quit their service. Funny, but I don't see the repo man coming after my T3 magazines if I don't renew. I bought it, it's mine.
If you combined these with a reasonable download price, and maybe some extra goodies thrown in for your patronage, then I'm betting you'd actually have a snowballs chance of grabbing a large share of the legal market. It'll happen eventially, but damn, they are seriously behind the curve.
You need a FREE iPod Nano
Until the record companies figure out how to make us interested they can lose all the money they want.
-- SIGFPE
Use a good LAME VBR preset. Even at 192 kbits, there is going to be a lot of wasted storage space and transmission bandwidth. There is no reason to encode dead silence at 192 kbits. I've been using LAME's --r3mix preset and getting 8:1 compression (on average) with excellent quality on my CDs. For crying out loud, VBR has been out for years.
Here's the kicker: 'But subscribers may only burn five tracks per month.' Hmmmm.....
'He who has to break a thing to find out what it is, has left the path of wisdom.' -- Gandalf to Saruman
Comment removed based on user account deletion
It seems so obvious... the problem is not that the music services make you pay, it's that they don't provide what people want.
I'm willing to pay, but what frosts me is the idea of paying for something that's NOWHERE NEAR AS GOOD as what I was getting for free.
I enjoyed downloading really weird stuff from Napster and AudioGalaxy. Are the Sonys and Vivendis of the world ever likely to provide Harry Champion singing "I'm 'Enery the Eight I Am?" Cab Calloway singing "Nagasaki?" Joe Venuti playing "The Hot Canary?" Raymond Scott playing the Clavivox? Charles Trenet singing "Fleur Bleu?" Kay Thompson singing "Eloise?" Bernard Cribbins singing "'Ole in the Ground?"
Or will they just have Britney Spears?
The solution is obvious. Let people upload and share material. "Electronic record store" is the wrong model. "Electronic flea market" or "electronic swap meet" is the right model. The only thing that needs to be changed from what Napster was doing is to do what flea markets do: charge a small fee to participants.
I have these items because other people that share my weird tastes were willing to provide them. Nobody has to wait for some executive to decide whether there's money in releasing them. If anyone thinks they have something that might interest someone, they upload it and if you're right, they download it.
This frees the service from all the cost of acquiring and converting recordings themselves.
Now, how much does sharing REALLY cost the record companies? There's not a doubt in my mind that a) the amount it affects them is tiny, almost lost in the noise; b) if it does represent lost revenues, it's a TINY loss; and that c) a solution along the lines of the "blank VCR tape tax" or the similar charge for home audio digital media could take care of it.
The other piece of the puzzle is micropayments. Why does EVERYONE want to charge me $4.95 and $8.95 and $11.95 per month? To cover the costs of charging me, or something? A jukebox will play a single song for a single payment $0.25. If we can put a man on the moon we should be able to provide an Internet service that delivers what a jukebox can deliver.
So, what you have a service patterned on the very successful Napster or Audiogalaxy, the only difference being that to access it, you need to charge $15 to set up your account, and every time you download a song, $0.25 gets deducted from the account.
There's no reason in the world other than pigheadedness why this couldn't work, and could be very profitable for music companies.
"How to Do Nothing," kids activities, back in print!
And so are the moderators who modded you up.
/. article a while ago about a small label hand burning CD's and mailing them to you for $4.95, shipping included. And making a profit doing it. $1 of that went to the artist. Assuming there are at least 10 tracks on the CD that's 50 cents per track. And that includes a physical CD, hand burning each CD, and mailing it. Large volume file downloads are practicly free in comparison.
The suggestion is for the the MUSIC COMPANY to sell downloads of the music they sell anyway. THEY HAVE THE MASTERS. It would take gross negligence for them to sell you a mislabeled or currupted song.
I ran some of the numbers. As long as they do a large volume of sales I think they could be rather profitable at 25 cents a track. The volume of sales and free publicity are guarenteed at that price. The bandwidth, 24-hour staff, and location costs combined are pennies per download. A few cents per download for the artists. Sell it as 80 downloads for a $20 subscription to avoid micropayments. And it makes a great gift-certificate.
Sceptical they could do it for a quater a download? There was a
At 25 cents a track for legitimate, high quality, and well indexed music, it WOULD be cheap enough to defeat P2P.
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- - You can't take something off the Internet! That's like trying to take pee out of a swimming pool.