Thursday, May 6, 2004
Industry Analysts Ponder Sony's Music Store
Posted by Jason Dunn in "ARTICLE" @ 02:00 PM
"Stand-alone software, which can be downloaded for free from the site, is needed to purchase tunes from the e-store. That could be a turn-off for consumers, according to Jarad Carleton, an IT industry analyst with Frost & Sullivan in Palo Alto, California. "Downloading software to order items from a store is a barrier for any company because, after a while, consumers get tired of having to download different software from different sites," he told TechNewsWorld.
Carleton said he finds Sony's move puzzling. "Now we have numerous companies in the legal music download business from Amazon (Nasdaq: AMZN) to Walmart to MusicMatch to Napster," he said via e-mail, 'I have to say that I don't see the value proposition for creating yet another place to purchase music -- other than those titles that Sony sells from its own site that have been published by its own label are going to have a higher profit margin than if they were sold via a third party music download store.' "
Looks like we're in for some ugly times as consumers. I think what we'll see happy is a proliferation of online music stores, likely a dozen or so before the end of the year, most will survive through 2006, but by 2007 we'll see mergers/acquisitions of collections. By 2008 there will only be a couple of online music stores because the market will have demanded that things are made simple, and hopefully by then the DRM will be tied to people, not to hardware. Studios like Sony will realize that they're better off renting their catalogue to a consumer music sales company, and leave it at that - and other music studios will follow suit. And there you have my predictions for the future. ;-)
Carleton said he finds Sony's move puzzling. "Now we have numerous companies in the legal music download business from Amazon (Nasdaq: AMZN) to Walmart to MusicMatch to Napster," he said via e-mail, 'I have to say that I don't see the value proposition for creating yet another place to purchase music -- other than those titles that Sony sells from its own site that have been published by its own label are going to have a higher profit margin than if they were sold via a third party music download store.' "
Looks like we're in for some ugly times as consumers. I think what we'll see happy is a proliferation of online music stores, likely a dozen or so before the end of the year, most will survive through 2006, but by 2007 we'll see mergers/acquisitions of collections. By 2008 there will only be a couple of online music stores because the market will have demanded that things are made simple, and hopefully by then the DRM will be tied to people, not to hardware. Studios like Sony will realize that they're better off renting their catalogue to a consumer music sales company, and leave it at that - and other music studios will follow suit. And there you have my predictions for the future. ;-)
