Tag Archives: music downloads

I Love Music, but I Hate CDs

rip

I guess that by now, all music labels have already realized that music downloads and subscriptions are the only way forward to distribute music. CDs are dead, and rightly so.

Maybe because we just finished unpacking the shipment from KL in our new home in Shanghai, I just happen to realize how I hate CDs. I have hundreds of CDs purchased before the MP3 era, and while unpacking them, I could only feel  how useless was the task of putting them on the shelves in my study room.

For my next move I only hope I will have already got rid of all the CDs after ripping them all to my music library, (or alternatively legally download private copies of them with Bittorrent).

I do not think I will ever buy a Music CD again. The last music CD I bought was played only once while ripped to my library. 

R.I.P. Music CDs.

Online Movies 2019

uhd

In 2019, while Music downloads are mostly free, people is ready to pay for Movie downloads.

The Music industry has changed in the past ten years and artists make their work known by distributing it for free. Their revenues come from fans fees, live performances, merchandising, ad endorsements and downloads of live concert videos.

Movie producers maintain theaters as their main source of revenue, but they also cash on HD downloads, at a few dollars each, and TV-rights from Pay-TV broadcasters. TV movie channels have survived due to the high number of people that still find “zapping” as the way to discover what to watch this evening.

With set-top-boxes powered by 128 cores CPUs, 250 GB RAM and flash drives of  32 TB, fed by a broadband connection of 8 Gbps, the premium content is now delivered in Ultra-HD at 4320p with 20.2 audio channels and 60 frames per second. HDTV 1080p is the standard quality, except from some lower resolution user-generated-content sites at 720p.

The Immersive Game Consoles just announced promise to deliver a new genre of  immersive games, but also immersive movies and immersive communications within a 3D virtual reality environment.

TV shows continue to be ad sponsored, and also available streamed from the Net with the option to download them for only $0.99,  free from inserted and overlay ads. 

The cash cows for Pay-TV operators are live sport events, broadcasted in HD and Ultra-HD and enriched with interactive features like multiple-angles and “watch-with-friends”. 3D VR immersive live events broadcasts are not available yet, but it will come in the next ten years before 2030.

This post is a fictitious prediction of what could be written about online video and movies in ten years from now. I can not guarantee it will happen but I am ready to take bets of $1.29, $0.99 or $0.69

 

Mobile Music keep growing in Japan

Thanks to KDDI Lismo music service, 90% of the digital music sales in Japan comes from mobile, according to Wireless Watch Japan. The Record Industry Association of Japan (RIAJ) has reported 2007 figures, with total sales increasing for third year in a row, and with an spectacular 91% increase in Mobile Music downloads.

Quoting Music Media Watch, :
“Total music sales for 2007 in Japan came to JPY 466 billion (US $4.66 billion). While CD/DVD sales declined 4% from the previous year, digital downloads jumped up 41% to JPY 75.5 billion (US $755 million), comprising 16% of all music sold in Japan. Mobile downloads accounted for JPY 68 billion (US $680 million), more than 90% of the total figure for digital sales.”

Japan is the biggest mobile music market in the world, fifty times bigger than the German one. This raises 2 questions:

1) Would it be so successful if the RIAJ had imposed a tax on mobile phones to account for (or rather to legitimize) piracy?

2) Will the 3G iPhone be able to grab a significant share of this market? Will the iPhone succeed in Japan?

Is mobile music service a handset vendor’s business?




Apple with iTunes is selling music directly to the iPhone.

Nokia has their own music portal Ovi for music and games.

And we see Motorola acquiring companies to reinforce the music service it was offering in China, Taiwan and Hong Kong.

Interestingly mobile operators are not taking an active role to own the music service, and seem to accept that they will be bit pipes for mobile multimedia. Not only that, but operators that get exclusivity for iPhone are reportedly paying Apple a 10% revenue sharing of the voice and data traffic generated by iPhone users.

As handset become more open and intelligent (think Android and Windows Mobile), Internet on-line stores will have it easy to sell songs to mobile terminals.

Except iTunes, which existed before iPhone, will handset vendor’s stores have any chance to compete in the online music business?

How will Music Industry survive Internet?

The Music Industry can not keep fighting to preserve their status quo. Internet, mp3 and iPods have changed the way we ingest music. DVD/CDs are doomed to disappear. The music and film industry will need to adapt to survive.

A wonderful extensive article has been published by Wired: David Byrne’s Survival Strategies for Emerging Artists — and Megastars. This is the best informed article I have recently read on this topic.

This chart from the article shows the trend for the Music Industry both in size and in formats.

With the costs of recording, manufacturing and distribution going down to almost zero thanks to Internet and new technologies, the role of the music labels becomes very thin, and many will disappear. At the same time, live performances are not part of promotion any more, but a business in itself generating revenues for artists. Similar to the music model before the 20th century, where artist made money mainly with performances. Only that today there is merchandising, advertisement rights, and publishing royalties (for adding the song to an ad or a movie) to add to the money inflow of artists.

Internet help artists to have their works popular to a wider audience. Artists have only to adapt to the new business models. Labels will need some painful restructuring, just as other industries had before.

iPhone: Friend or Foe? Can Mobile Operators avoid turning into pipes?

There are two major conflicting trends in Telecommunications :

1) Internet driven: the intelligence and applications move to the end-devices (Smartphones, laptops, Servers…)

2) Telcos driven: Operators need to retain control of the Services delivered through their networks

On example of these two trends are: Skype vs IMS.

Skype corresponds to trend 1). The application is running on PCs or handsets, and the Service is offered directly by Skype, independently of the Operator that provides simply IP connectivity.

IMS (IP Multimedia Subsystem) is standardized by the telco industry – 3GPP and others-. It aims at providing multimedia services over an IP network, with the Service fully controlled by the network Operator that guarantees reliability, interoperability with other Operator’s networks and Quality of Service. Something that Skype can not offer, due to the nature of Internet.

So far, Mobile Service Providers (MSPs) have fought to retain control of their services and to own the customer, while opening their networks to Applications partners.  MSPs have been relatively successful in monetizing all premium content services delivered through their networks, including: ring-tones, games, wallpapers, logos, videos, TV-shows televoting and other SMS premium services. This business model is based on revenue sharing with Application/content partners.

While MSPs have successfully keept Service control, the usage of mobile Data Services has not gone into mainstream yet, mainly because the data capacity offered by GPRS/EDGE was too limited and charges were too high.

With 3G and HSDPA widely commercial in many markets, MSPs re-position their Data Services as Mobile Broadband with flat fees, volume capped to avoid congested spectrum.

Some Operators see the increase in data capacity as an opportunity to sell more premium content than before, including bandwidth intensive video applications, or music -e.g. KDDI selling music, Testra launching a Rich Media video service for 3G-. But some other MSPs seem to be giving up, as they accept a mere Internet Pipe role and give away the applications to Internet players, losing any option to monetize those applications offered through their networks. e.g. MS messenger, mobile Gmail, Google maps or even Skype for VoIP… and iTunes for Music.

Mobile Operators have a trusted billing relationship with their clients which should enable them to easily monetize any Services accessible through the mobile to the clients they own.
That was the theory over the past years. In reality, today Internet players are also building a trusted relationship and do not need the Operator anymore.

MSPs worldwide rush to sign exclusivity agreements for iPhone launch, but apart for the short-term gain of signing-up the higher-ARPU subscribers that will own an iPhone, Operators are giving Apple the full control of the applications .


iTunes songs will be sold over the MSPs networks, same as it is in fixed broadband today. What revenues will the MSP get from those songs sold by Apple? Zero.

With iPhone, Windows Mobile and Android coming into the picture, the situation is not likely to improve for MSPs.

Mobile Operators will get a higher demand for flat fee Data Access, which is already  good, but they can start forgetting about monetizing premium content, unless they seriously invest to reverse the trend.

Fixed Broadband operators with IPTV, are showing that the trend can be reversed. As Telefonica’s Imagenio IPTV Service illustrates, the Operator can play a key role in content distribution over their networks. Again, it requires vision and determination, as Telstra, KDDI or Telefonica have, to transform themselves and become a player in the entertainment industry.