My colleague Thomas Husson, who covers mobile for Jupiter in Europe is at 3GSM and has been up late into the night blogging and forwarding mobile music news to me!
One of which is Jamba’s (home of the adorable (sic) Crazy Frog) announcement of their mobile music download service. They expect to launch with a quarter of a million tracks and though there are question marks over complete major label participation at this stage, what intrigues me most is this quote from COO Markus Berger-de Leon:
“We’ll look at everything. We have to explore credit card options and so on if we want to compete with iTunes and Napster.”
Do they really expect to compete head on with PC download and subscription services? Are they even able to? If I had seen this announcement 6 or 9 months ago I wouldn’t have given the question more than cursory consideration, but there are a couple of factors which give me pause for thought.
Firstly, mobile operator over-the-air music download services are clearly having a lot of success in number of tracks downloaded. Granted, lots of them (in some instances close to half) are provided free of charge (often as sweetener in bundles) but the scale of adoption indicates clear consumer demand. (Some operators claim greater number of downloads than 2nd and 3rd tier Internet download stores). Don’t get me wrong, I’m not suddenly a convert, the demand for free music here may be no different than the demand reflected by file sharing, but consumers are clearly willing to download relatively poor quality audio tracks to playback on their mobile phone.
A second big factor inhibitor for mobile music downloading is the storage capacity of handsets….and this is what makes the Jamba announcement stand out for me. They say:
“Jamster will sell songs on a per-download and rental basis, using a delivery and DRM platform it has built itself. The service will be dual download, enabling consumers to buy or rent tracks via mobile or PC.”
If that means (and they are still at the ideas stage so the decision hasn’t yet been made) a full music subscription service that allows consumers to swap tracks in and out on their handset with no extra cost as part of their subscription then that is a great way of circumnavigating the limited capacity issue. A great near term fix until handset capacity is raised among the installed base.
Jamba also have another asset here – their controversial business model for mobile content is a subscription model, so their customer base is already in the mindset of paying in advance for content they haven’t yet chosen. This is a major hurdle that Napster et al are still trying to guide consumers over on the PC platform.
A final aspect worthy of note is the dual-delivery approach. Typically this is a tacit acceptance that mobile music tracks are of such inferior audio quality that a full quality WMA version is needed to assuage consumers. However the interesting possibility remains that if Jamba et al were to sell direct to consumer on both platforms that the scale reached via mobile customers might enable them to become major players in the Internet download market.
Which begs the question “Can mobile and Internet downloads co-exist?” Well that just and so happens to be the topic of discussion for a panel in Jupiter’s forthcoming Plug.In digital music seminar in London. Watch this space for more details.