French telco Neuf Cegetel, the country’s 2nd largest broadband ISP is set to introduce a music subscription service in partnership with Universal, who’s parent Vivendi Universal just happens to have a controlling stake in Neuf’s parent company SFR.
Subscribers to Neuf’s triple play offer will get unlimited access to Universal music of one genre of their choice. This being music subscription that means DRM protected downloads that expire when the subscription expires. For an extra Euros 4.99 subscribers get a further eight genres.
This is bold attempt to kick start music subscriptions in France, but it won’t be an entirely easy sell. Firstly, even though Universal are the world’s largest label, they still only account for a little over a quarter of European music sales. The Raison d’ętre of music subscription services is unlimited access to music. Leaving out three quarters of all music from the offering goes against that basic premise. Furthermore, as Jupiter’s old music analyst Aram Sinnriech used to be fond of saying, music fans are label agnostic. When it comes to the majors in particular, they’re interested in the fans, not the labels. However, let’s assume that this is simply catalogue available at launch and will follow the lead of fellow French Universal offering e-Compil and will offer other label’s catalogue.
Even with broader catalogue though, and even though the bundling tactic is a smart one, Neuf will be breaking the mould if they sign up significant numbers to the premium service. At the end of last year just 0.2 percent of European Internet users paid for a music subscription service. Napster found life so tough in the UK that they recently scaled back operations and retreated to Germany where they were experiencing some unexpectedly positive, yet still modest, adoption. Real (the company behind the leading Rhapsody service in the US) have considered the European market so lame that they have opted instead for a premium radio service.
Music subscription services are fantastic concept, unfortunately they are an alien concept to most consumers and it is a long sell. Also, for every 2 steps forward, Steve Jobs can punch them right back with a ‘rental’ jibe.