By Richard Menta - 9/17/01
PressPlay (formerly Duet) announced they would be up mid-month only days before the attack on the WTC. It only makes sense that didn't happen, the record industry has curtailed all events for the next few weeks as seems proper. Still, it is an important moment in the online music world as the first half of the industry's answer to Napster is ready to offer digital music for sale.
Friday as rescue workers dug frantically to find more survivors, the other half of the industry's offerings, MusicNet, quietly announced that they too would be open for business in the coming weeks, aiming for an early October debut. Soon the music that we have been trading for years now will be available as an official product - albeit at ridiculously high prices.
Relative to the recent events, our rants against the music industry and the cartel actions they have forced upon both the consumer and the artist seem trite. I guess when you put everything in perspective, the price tag that someone puts on the wares they sell is just that, a price tag. MusicNet and PressPlay are nothing more than wares.
But life goes on, and musicians who watch tens-of-millions of dollars come in for their work only to see a few pennies of that money have to find a way to pay the bills and support themselves. Consumers who want the music of all their favorite artists, but who can only find room for six of them a year because prices are too high, want a cheaper solution. Cheaper means free right now thanks to Napster and its clones and the question is will digital music continue to be free or will it evolve into pay? If it does evolve into pay, how much?
PressPlay and MusicNet cost too much
As we have pointed out in several articles in the past, the prices and conditions of ownership that MusicNet and PressPlay offer are a poor deal for the consumer (see MusicNet and Duet: Downloads Expire After 30 Days ). First of all music is rented, not purchased. A CDs worth of music will cost $20 per year to possess, which is more than a standard CD costs in stores. After the year, you can purchase additional time for another $20 a year, bringing the total cost for that CD to $40. Stop paying at any point, and the music expires leaving you with nothing.
Furthermore, neither service has access to all music. PressPlay only has the music of Universal and Sony. MusicNet offers the music of AOL Time Warner, EMI, and Bertelsmann. To be able to choose music from all five labels means you need to subscribe to both at about $240 a year. The average person to date spends about $90 a year on CDs.
The music available on PressPlay and MusicNet also exclude the music of hundreds of independent labels. All that music, as well as the music of the five major labels are available for free on Napster clones. These clones have become so popular, they presently take six out of the top ten downloads on CNET's Download.com site.
At the proposed prices it is difficult to fathom how PressPlay and MusicNet will be able to compete. There are quite a few people who feel guilty about getting music for free from Napster clones and who would consider purchasing the same music at reasonable prices for piece of mind. The problem is MusicNet and PressPlay do not offer reasonable prices. Even former MP3.com CEO Michael Robertson predicted failure for these services and this came after MP3.com was acquired by Vivendi Universal, making him technically a record industry exec.who should have been towing his new company's line. He didn't and has since chosen to move on from the digital music industry he hoped to create.
Unless MusicNet and PressPlay radically revisit their pricing scheme or until they eliminate the Napster clones, we think their products are doomed too. Of the two choices, eliminating the Napster clones is by far the most challenging, a task possibly beyond the grasp of the worldwide record industry.
Many Napster clones have wisely set up operations overseas away from any negative US court rulings against Napster. The Record Industry Association of America (RIAA), with the help of their international counterpart the International Federation of the Phonographic Industry (IFPI), plan to stop these Napster clones. But in a world where a third world country like Afghanistan is watching hundreds-of-thousands of its citizens flee to the borders for fear of US retaliation, it's hard to see many countries putting file trading over national security on the top of the to-do list. The major European and Asian countries will eventually act first, but that may only chase Napster clones to countries with significant economic uncertainties and a desire for technology business that has the potential to create jobs and funnel in money.
Scary times are on the horizon. Overseas? Well, let's just say that governments have bigger worries than chasing Napster clones right now. Chief is how recent events will effect the world economy, a big question mark as stock markets across the globe drop precipitously. If they want to be more than a future trivia question on Jeopardy, PressPlay and MusicNet better start taking a cleaver to their prices and product restrictions and learn to serve the consumer, not the conglomerate.
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