Wednesday, September 06, 2006
EMI Leaps to SpiralFrogSpiral Frog snared its second music publisher in EMI for its ad-supported music download service. The EMI deal also gives SpiralFrog the rights to publish lyrics online.
Creating an ad-supported service that lets users read lyrics makes sense, because there's not much of a business model to jeopardize. The market for selling lyrics is negligible, while the demand for free lyrics servers has always remained strong despite the music industry's protestations.
But the details in a Reuters article only reinforces my belief that the download service will only further erode (though not by much) music industry revenues while doing little to combat piracy.
Users have to view a 90-second advertisement while downloading each file; files expire after six months; and the tracks can only be transferred to portable devices that are compatible with Microsoft's WMA (Windows Media Audio) digital rights management standard.
So no iPods, no burning to CDs, DRM, and a short life span. These downloads have more strings than a harp, and most people would prefer to pay or pirate than have all these conditions on their music.
The Reuters article adds that the wholesale cost of downloads is 60-70 cents each. So how much will SpiralFrog charge advertisers for each ad? $1? Would anyone pay that?
Since Napster and RealNetworks are having problems making a free listening service pay for itself, I'm betting this frog will be quickly fricasseed.
By John Gartner at 02:32 PM | Comments (2)