Why Starting a Legal Online Music Vendor Is Tough

Hodejo1 writes "Former MP3.com CEO Michael Robertson offers commentary at The Register saying any attempts to build a sanctioned digital music site today is doomed from the outset. 'The internet companies I talk to don't mind giving some direct benefit to music companies. What torpedoes that possibility is the big financial requests from labels for "past infringement," plus a hefty fee for future usage. Any company agreeing to these demands is signing their own financial death sentence. The root cause is not the labels — chances are if you were running a label you would make the same demands, since the law permits it."

Comments

Business logic or monopolistic cartel?

[StrategicIrony]

Just because I'm allowed by law to charge someone whatever I wish for the fruits of my business, this doesn't mean I would, or that I should. I would go out of business very rapidly.

However, if I ran a cartel, controlling a monopoly share of a highly desirable resource... then I guess I understand where they're coming from.

But... wait... aren't monopolies illegal for this very reason?

Re:I tried and failed

[Technician]

But there is one, inescapable truth - Internet piracy is mostly to blame.

It's a common scapegoat, but missing the mark. Percieved value and retail price are an order of magnitude out of place.

Instead of wasting money on a shiney disk with about 45 minutes of stuff along with one good song, I can buy a DVD for half the price.

I can carbonate water at home and add my own flavoring and sugar, but I still purchase fountain drinks for the convience.

CD's are now the oposite of convience for more money. Downloads go right on to an MP3 player. CD's have to be found if still in print, ripped and put on a player.

Online is a-la-carte. CD is a canned package.

Some compainies wanted to make and install in store CD burning kiosks. Guess who killed that in the bud?

For an industry who doesn't listen to their consumers, they sure scream P-P a lot for their lack of adjusting to the market.

If you scream P-P enough, will the death of your scapegoat really fix your root problems?

Some people are offended by my blacklist system.

This would be mostly your best customers. Those who don't listen to music don't buy CD's. Those deeply into music purchases CD's and shares copies of out of print stuff or the one good song on a CD. Blacklisting them is a great way of killing the biggest part of your business. Thanks for providing great evidence the industry doesn't understand the market.

Much of the industry is selling pig in a poke packages. I bought the DC Talk album Supernatural because our church performed Red Letters, and I enjoyed the choir rendition. I hated the album, even the good track. I'm not into acid rock. Needless to say, once burnt, twice shy.

How many times have you bought an album because you only heard one song and then didn't like the rest of the album at all?

P-P expands music horizons. Most of the time when I bought albums, I heard it from friends first. (I quit buying entirely when the industry started dropping the nuke bomb on some unlucky few as a protest.)

My peak buying days was when I was in the military while in my peak piracy days with cassette tapes. The industry doesn't understand their consumers or the market.