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Ten Dollars for That Music Subscription? No Thanks!
August 27, 2005
Thomas Mennecke
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99 cents a download. $14.95 for unlimited rentals. $8.00 and upwards for a full album. On a global scale, music subscription services are doing well. Although using a plural may be pushing it - as iTunes is by far conducting the most business out of all sanctioned music services. With its trendy iPod music player, downloading the occasional $0.99 download is within the budget of many.

Comparative to file-sharing networks however, sanctioned music services such as Napster and Rhapsody continue to struggle. While iTunes is a commercial success with its 500 millionth download since its conception, it still pales in comparison to the billions of files traded per month over file-sharing networks.

There are several reasons why approved music services have not quite broken the P2P dam. It has been argued approved music services are still lacking in the catalog department, despite having over 1 million songs in their arsenal. Still, they contain what most people crave; which is top 40 pop music. Despite this flaw and many others, it appears the bottom line is the all mighty dollar.

Or Euro, Yaun or Pound.

Indeed, the hesitation surrounding the mass entry into the approved music service market is all about money. Although we don't necessarily need a data firm to conclude this, researchers at Park Associates interviewed MP3 player owners from around the world, specifically in China, the US, the UK, France and Germany. The study asked MP3 player (stand alone players, CD MP3 player, computers, etc) owners what they would be willing to budget on digital music on a monthly basis.

The country in question depended on what its people were willing to spend. Interestingly, all nations in the study had a sizeable portion of respondents willing to spend nothing per month on digital music. In France for example, 40% of those questioned were not willing to spend any money on digital music (a majority.) However it the UK, 62% of respondents is willing to pay up to $10.00 per month on digital music.

While respondents in each country varied on what their monthly digital music budget would be, one thing was clear; very few individuals were willing to spend more than $10.00 a month on digital music. Only 10% of German respondents were willing to spend 10 dollars or more, while only 2% of UK MP3 owners would spend that amount.

The study makes the point that Yahoo!'s new low cost music service may cut a sizable niche in the digital music market if the competition's price remains constant. In the long run however, it remains to be seen whether Napster, Rhapsody, and particularly iTunes will change their policies especially if their market share remains intact.

This story is filed in these Slyck News categories
File-Sharing/P2P Related :: Statistics/Analysis
Authorized Music Store :: Other

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