Is there a future for subscription music services?

“once people realize that they can consume unlimited music for the same price, they begin exploring related songs and bands, checking out recommendations from friends that they never would have bothered with otherwise, and so on.”

Tim Quirk, VP of music programming for Rhapsody

It’s a nice thought but it hasn’t happened yet and it’s not likely to happen in the future unless there’s some real changes made in how subscription services are marketed to consumers. You’ve heard me on this before. Up until now there were only two models for music, the free and ad supported stuff on radio or music you bought or owned. Subscription services change all that in a new way. While consumers “rent” content all the time from theaters, cable companies, netflix etc, there’s also a lot of other stuff sold on dvd. This is not binary, rent or buy. It’s going to be both side by side but the first step to making this mainstream is to educate and evangelize the market. Rhapsody hasn’t done that yet and until they do few folks will ever discover the benefits of the service. Unless someone makes this happen sooner as opposed to later, it’s hard to see the long term future for these types of services ever capturing any real share of the mass market. Of course, there’s always the rumor that Apple might get into this game. One thing’s for sure, Apple entering the market would solve the consumer education issue. Of course, that might not be the result REAL is looking for here.

ISVs will help decide success for mobile platforms

Once upon a time there was a high tech product built by a really cool company. It came to market with great fanfare and consumers anxiously awaited the release. While it totally changed the accepted status quo in terms of elegance and the way things worked, it was higher priced than almost all of the competing products and more than one review emphasized the fact that competing products could do essentially what it could do with greater cost savings. While the device came with software that could perform some useful stuff, there were lots of things lacking in what they could do, although the things they did, they did with elegance and style that could not be matched. The hardware was unlike anything anyone had seen before but also had some curious choices in terms of keyboard, memory and expandable storage… The product was refined over time and it went on to become a pretty great success.

While that may sound like I’m referring to the iPhone, I’m actually referring to a product that went on sale 25 years ago, the first 128k Macintosh. There’s a lot of similarities but one of
the main differences was that Apple allowed third parties to build for Macintosh and that made all the difference. It’s what led to Excel (which was first developed for the Mac) and allowed MacWrite users to gain access to more sophisticated word processors. It created whole new products such as MORE! that could not be done at any cost on a DOS machine of that era and led to creation of entirely new cottage industries such as desktop publishing.

Each time I used the iPhone early on, I loved the experience and I praised the design but also ran into limitations. I wanted to play games and use RSS readers offline. I wanted a Slingbox client and the ability to view PowerPoint documents and in general, a better handling of Office files. I wanted my email and calendar to sync with Exchange wirelessly. All of these things were delivered by third parties over the last few months and have made the platform richer and more usable.

The first Macintosh ultimately succeeded because Apple overcame some of the biggest hardware issues quickly (remember the Mac Plus?) but more importantly, built an eco system, that never had the most applications, but always had the best of breed. If Apple customers would have gotten the Mac Plus but still had only MacWrite and MacPaint to fall back on, the story would have turned out in a very different way.

The next 18 months aren’t going to be defined by the core capabilities of mobile platforms alone. It’s going to be about how those platforms are extended through the use of software to create new experiences and offer new services to users and revenue streams to developers and carriers.