Today UK satellite Pay TV provider Sky announced a new music service which they will make available later in the year. The fact that the offering has been announced now before having a name, pricing structure, product tiers or software application confirmed, hint at the importance of this to Sky politically. Though Sky and their current sole content partner UMG explained that this has been in the pipes for some time and is a “happy coincidence” of timing with the BPI’s current activity, it none-the-less positions Sky as firmly on the side of the music industry without (yet at least) implementing enforcement measures like those of Virgin Media. This could even be part of an explicit longer term play to avoid the ‘stick’ of intrusive enforcement tactics by assuming the role of pioneering legitimate service provider ISP. A few weeks ago Ferghal Sharkey of BMR indicated that he expected to have deals to announce within weeks. So more pressure on Sky being first to press with their announcement to assume the ‘digital pioneer’ mantle?
But enough strategic conjecture, onto the service itself. Though details are partial at this stage it promises to be a multi tiered premium subscription service with a mix of streaming (to the PC) and MP3 permanent downloads. The number of downloads you’ll get depends on which pricing tier you adopt. It doesn’t appear (yet) that one of those tiers will be a unlimited or near-unlimited MP3 tier.
Sky’s offering is part of the Second Coming of music subscription services, and UMG were keen to stress the importance subscriptions are to the future of their business. Jupiter has always been a big advocate of subscription services, David Card particularly so. I have to admit to losing my faith a little over the last few years, but am certainly being converted again by the various new takes on the concept. Card just held his ground and let the market come round to his way of thinking.
Sky’s offering should come to market roughly the same time as UMG’s other big next-gen subscription offering: Nokia’s Comes With Music. The two should be well positioned to have minimal overlap: CWM is targeted at tech savvy individuals, Sky’s appears to be more targeted at households and families.
But can Sky succeed where Virgin (stores, not Media) and HMV failed and where Napster has under-whelmed? i.e. get Brits to pay for music subscription offerings in numbers? Well Sky has the unique asset of already having millions of households paying monthly fees for entertainment. Their target has to be to convert mainstream music listeners to digital music. But can Sky really hope to get Mondeo Man hooked on downloads? It’s a big ask, and if Sky are to succeed they’re going to need to leverage every ounce of relevant asset via strong integration across platforms, hardware (getting this into Sky boxes and the TV, not just PC) and other relevant content assets and relationships.
Digital music hasn’t yet converted the mass market and music subscriptions have failed to do anything meaningful (0.1% of Europeans paid for one in 2007). Sky can be counted on to market and cross-promote this thing until the cows come home. With that kind of promotion and (at risk of sounding like a stuck record) hardware integration, they might just open up a new audience to digital music.