Microsoft (MSFT.O) will not launch a product that competes directly with Apple's (AAPL.O) iPhone, Chairman Bill Gates said in an interview with Germany's Frankfurter Allgemeine Zeitung.
"No, we won't do that. In the so-called smart phone business we will concentrate solely on software with our Windows Mobile program," Gates was quoted as saying in the interview published on Wednesday. "We have partnerships with a lot of device manufacturers from Samsung (005930.KS) to Motorola (MOT.N) and this variety brings us significantly more than if we would make our own mobile phone," he added.
EU Drops Probe as Apple Equalizes iTunes Prices
The European Commission ended its antitrust investigation into Apple after the company agreed to reduce the price of music downloads from its iTunes website in the U.K., the European Union's antitrust regulator said Wednesday.
Apple said that within six months it will lower the prices it charges for music on its U.K. iTunes Store to match its already standardized pricing across Europe in Austria, Belgium, Denmark, Germany, Finland, France, Greece, Ireland, Italy, Luxembourg, Netherlands, Norway, Portugal, Sweden, Switzerland and Spain
Yahoo revises its browser-based MP3 player
The search company updated its application which plays MP3 files directly within the browser, this time allowing third party developers to use the functionality. Previously, it had been intended for use with 30-second samples of music tracks from its Yahoo Music site. However, now Yahoo is opening up the code to allow anyone to use the application for his own purposes.
Yahoo's player is also similar to a Flash application that it recently released on its beta site, Yahoo Next. The company explains that these are essentially the same application, however one uses flash to run, while the other employs JavaScript. The player's API is built completely in HTML, however the back end is in JavaScript. In addition, the developer has control over what the application uses as album art, the sequence in which MP3 files are played, and how the song should be titled.
Sony BMG Promotes Platinum MusicPass MP3 Card To Latin Market
Sony BMG is promoting its new Platinum MusicPass MP3 retail card with a new campaign targeting the Latin music market. MusicPass albums by Alejandro Fernandez, Calle 13, Jennifer Lopez and Camila are among the 37 Latin acts whose albums will now be available. The credit-card sized cards are available from BestBuy, Fye, Target and others. The cards not only contain the entire album encoded as 320kbps MP3 files, but also feature music videos, artist interviews, live tracks, documentary videos, digital CD booklets, lyrics, remixes and other goodies for $12.99.
Sony Stops Licensing Of Digital Streams As It Allows DRM-Free Music
The timing on this one may be something of a coincidence, but it's worth noting that at just about the same time that Sony is getting a ton of press for finally realizing that DRM doesn't make sense, the company has also told the Harry Fox Agency to stop licensing its music for digital streaming (via Mathew Ingram). As Ingram points out, this decision is really about the rather arcane details of copyright law and two (of the many) different license requirements that are out there. The RIAA labels have all been pushing (not surprisingly) for whatever combination of licenses that will bring them the most money. This isn't new, of course. We saw it in the battle over what licenses satellite radio had to pay. The same battle is now happening with digital streaming services. The Digital Media Association has asked the copyright board for a ruling saying that an audio stream should only be required to pay a performance license (as it's a performance) rather than a reproduction license (like for a product that's actually being distributed). Because of that, Sony has basically said it won't be distributing any more music for streaming until this is settled. It's likely the other labels will follow as well. I
Yankee Research Predicts Record Label Marginalization
The Yankee Group used CES to share an analysis showing two fundamental shifts are driving the music industry - digitization and direct-to-consumer transactions. As a result, Yankee says, US recording revenue has plummeted 25% or more since peaking at $14.6 billion in 1999.
Over the course of the next several years, Yankee Group anticipates that music industry revenue will begin to stabilize in the US, though at a lower level than previously seen. By the end of 2007, digital music revenue in the US grew to $1.98billion, and will reach $5.34 billion by 2012. However, artists will increasingly keep the lion's share of this revenue as record labels become marginalized. The report offers solutions:
- Abandon DRM; embrace watermarking: Record labels can't escape DRM, but by embracing watermarking, they will make it completely transparent to consumers.
- Leverage Anywhere Consumers: Record labels should encourage consumers to become legitimate distribution channels themselves and enable them to profit from it.
- Promote PC, not the phone: Wireless carriers must aggressively push the PC rather than the phone as the digital music distribution channel. The PC dominates music downloads.
This week in Las Vegas, thousands have gathered to pay homage to the pantheon of gadgets and software that is the Consumer Electronics Show. Hundreds of companies will pitch their newest devices, designed to wow. The breadth of innovation will astound us all. Throughout it all, there will be one frequently recurring theme: The content that is the foundation for so much of this innovation and experimentation is music.
Last year was a challenging one for the music industry, no doubt. But to those who may wonder about the relevance or the role of music companies in the digital era, the array of platforms for music at CES are a reflection of the enormous potential that gives us reason for optimism.
CES update: Real Networks wants to be a 'music dial tone' Requires login
That was the theme of my meeting late Tuesday with Rob Williams, RealNetworks' senior vice president of music. Williams was pitching the idea that his company's Rhapsody music service is going to become something he calls 'music dial tone,' accessible anywhere and everywhere, on multiple devices and platforms.
The idea that Williams and RealNetworks are pushing is that Rhapsody is going to be a standard offering for anyone who wants to deliver Internet music. His argument is that only RealNetworks has built the scale and the business model to support so many different platforms all at the same time.
Has the Steve Jobs reign of power ended?
As one BusinessWeek column points out, Steve Jobs was only able to win the studios over by increasing the amount he's willing to pay for films. According to the report, Jobs had once capped the amount he would pay for each movie sold at $14, but has agreed to the $17 fee larger retailers like Wal-Mart are currently paying. To make matters worse, the music industry has stood up to Jobs for the first time and has offered DRM-free music to Amazon even though Jobs and Company have been asking for such a deal for quite some time. Who would have thought this day would come? Not only did Apple seem like it would ride into the sunset with its iPod-iTunes connection, it seemed as though one company actually commanded the kind of power the film and music industry once wielded. In essence, both industries were at the mercy of one company for once and, well, it felt good.
Whether it's his pompous nature or his belief that he was invincible, Steve Jobs truly believed that he could demand anything from the movie and music industries and win out because of the immense success of his company. After all, what would indicate this mentality was wrong? He was able to keep music prices down to $0.99 even though movie studios wanted them increased and as the iPod continued to sell, the movie studios and record labels needed Apple. And while they still need Apple, the impetus to give in to Jobs' demands has lessened. Once again, we have entered into a situation where the music and movie industries have been able to gain the majority of control in the business and all Apple can do is acquiesce.
MusicGiants launches high-quality video service
The high-quality music download service is making the logical progression into high-quality downloadable video with the launch of VideoGiants.
Panel: Ads are more powerful for promoting artists than their own music
At an all-day Billboard Magazine event, the day's first speakers argued that background music has the potential to do more for an artist's popularity than major label promotions, radio, and dedicated video airplay.
Sara Bareilles is one example of this change. Because of her appearance in a Rhapsody commercial, sales of her recordings on iTunes skyrocketed. A single commercial took an artist from virtual obscurity to the desktops and iPods of millions. Latterman said that a single "music by" blurb at the end of a television show, commercial, or video game has the potential to single-handedly multiply an artist's audience by a factor of ten. In this case, it was the artist's fantastic iTunes sales generated by the commercial appearance that actually got her airplay on terrestrial radio.
Yankee Group Projection Offers Good News, Bad News
US-based digital music will remain high growth over the next few years, according to a recent Yankee Group projection. But the research firm noted that major labels will only realize a portion of the gains, and the recording industry will ultimately settle at a lower revenue level.
Just how high will digital formats climb? The Yankee Group projection called for digital revenues of $5.34 billion in the United States by 2012, up from an estimated $1.98 million in 2007. Of that pie, online music - mostly paid downloads - will grab about 80 percent of the action. "Although the addressable market for music phones will have grown to more than 266 million, only 9 percent of mobile users will actively use them as portable music players," the report indicated. Of course, markets like Asia and Europe have far different profiles, yet questions continue to linger on whether North American consumers will evolve in the same manner.
And what about major labels? According to Yankee, the big four will ultimately become marginalized in the process, thanks to strengthening direct-to-fan channels. "It's not just that the record labels are facing declining revenue; rather, the basic relationship between recording artists, record labels and consumers is in major flux," said Michael Goodman, director of digital entertainment at Yankee Group.
Anyone want to buy a music subscription service? Anyone? Anyone?
According to Silicon Alley Insider, Yahoo may be looking to sell its music subscription service. The move makes sense: Ian Rogers, the general manager of Yahoo Music, declared in October that he was done inconveniencing users with the digital restrictions labels required for online music subscriptions. Subscriptions simply haven't materialized as the profitable business model for artists, labels, and services alike that many had imagined. Freeing itself of the failed model will allow Yahoo to focus on free, ad-supported music. The only problem now is dumping the old service.
The only serious potential buyers are RealNetworks, though they may have fallen out of buyout talks already, and Napster, which continues to perform poorly and just recently began to shift its strategy away from subscriptions, too. Getting out of the subscription business is probably a necessary move for Yahoo, but the company may just have to settle for mothballing the operation. Good riddance.
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