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MacBytes
May 11, 2005, 02:42 PM
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Category: Tunes
Link: RealNetworks drops 21%, Napster plummets 30% on Yahoo music news (http://www.macbytes.com/link.php?sid=20050511154244)

Posted on MacBytes.com (http://www.macbytes.com)
Approved by Mudbug

PlaceofDis
May 11, 2005, 02:44 PM
i guess the subscription market is rather fickle right now, wonder how much all three would drop if Apple entered the market with subscription service?

Blue Velvet
May 11, 2005, 02:46 PM
We are convinced this is the way you should be listening to your music.

Not 'we are convinced that this is what our customers want'.

The arrogance of that first statement is breathtaking.

Alukardo
May 11, 2005, 02:50 PM
Meh.

If the subscription model does take off, Apple can simply offer it along its usual service.

I'm surprised the music majors aren't catching on about how potentially easy it is to abuse a subscription service.

PlaceofDis
May 11, 2005, 02:53 PM
Not 'we are convinced that this is what our customers want'.

The arrogance of that first statement is breathtaking.

i know, thats the music labels and greedy folks for you though, they push the model that will make the the most money, not what is neccissarily what the consumer wants

Nickygoat
May 11, 2005, 02:55 PM
Their prices are right to drop- Yahoo is far more serious competition than Apple is in this market. Yahoo has very strong brand recognition and an installed subscriber base. If I was a Yahoo subscriber for $7 a month more I'd do it too. $15 would make me think a little bit. What surprised me from that article was that Napster only has 410,000 subscribers and Real 1 million? I find that suprisingly low for Napster and high for Real.
Apple isn't really the competition in this field - they're eating each other.

Sun Baked
May 11, 2005, 02:57 PM
Can't wait until they find a way of including commercials into the mix... :p

Daveway
May 11, 2005, 03:20 PM
and AAPL dropped enough for my broker to sell. :( :mad:

MarcelV
May 11, 2005, 03:23 PM
...What surprised me from that article was that Napster only has 410,000 subscribers and Real 1 million? I find that suprisingly low for Napster and high for Real....

The 1 million include the SuperPass subscriptions and that's around for a few years. So, it is not just the Rhapsody subscribers.

shamino
May 11, 2005, 03:25 PM
Can't wait until they find a way of including commercials into the mix... :p
I wonder if Microsoft mandates such a provision in their DRM system. For all you know, they may provide the ability to secretly upload commercials into your portable player along with the purchased songs. They can even tie the comemrcials to the DRM decryption key, so the songs break if you delete them.

Of course, this, by itself, is not really a problem. If someone offered a subscription service for free, in exchange for 15 seconds worth of commercials after every 2-3 tracks, a lot of people (maybe even myself) would probably go for it. This, after all, is very close to what you get when you tune in to an internet radio station.

Of course, record-labels' greed is far too great to allow this. They would insist on monthly subscription fees in addition to the ads. You'd have to be insane to scubscribe under those terms.

SiliconAddict
May 11, 2005, 03:29 PM
Many record label executives prefer the subscription approach, Leigh said, because consumers are more likely to sample songs from relatively unknown artists, a phenomenon that helps the industry create more moneymaking stars.

What a complete load of BS and they know it. I'm willing to bet Leigh couldn't keep a streight face when he said that. :mad:

SiliconAddict
May 11, 2005, 03:30 PM
I wonder if Microsoft mandates such a provision in their DRM system.

They don't. :rolleyes:

shamino
May 11, 2005, 03:57 PM
They don't. :rolleyes:
How would you know? As far as I know, you can't get the developer docs for Microsoft's DRM with signing an NDA.

I did not say that they mandate commercial-insertion. It's obvious that they don't, because it isn't happening.

I'm asking whether they have this capability in their DRM system (in order to support services that want it), and if they require portable players to support the capability in order to be fully "Windows-DRM" compliant.

SPUY767
May 11, 2005, 05:20 PM
Yahoo is going to flounder because right of the bat, by choosing PFS, they alienated 70% of the market.

coolfactor
May 11, 2005, 05:23 PM
Yahoo is going to flounder because right of the bat, by choosing PFS, they alienated 70% of the market.

What is PFS?

Fender2112
May 11, 2005, 05:23 PM
I think Apple should go ahead and offer a subscription service. There is nothing to be lost but a lot to gained. It would also put an end to all of this quibbling about who's going to take down Apple. :D

bluebomberman
May 11, 2005, 05:43 PM
What is PFS?

Plays For Sure

J-Squire
May 11, 2005, 06:41 PM
Yahoo is going to flounder because right of the bat, by choosing PFS, they alienated 70% of the market.

What other choice do they have???

I don't understand this comment. What was the alternative? Apple has refused to license FairPlay DRM to other music providers, so they have no choice but to go with WMA and Janus. Janus is a good technology is you have no option but to go with WMA.

I think this is a major announcement and could have the potential to rattle Apple's cage more than any competitor so far. It is the first option that seriously undercuts Apple. You can purchase single tracks for 79c.

How are these other companies getting such good deals from the record labels!?? Apple is the industry giant, yet they seem to be the least favoured supplier.

dejo
May 11, 2005, 07:24 PM
What other choice do they have???

If there are no choices, then it's called a monopoly...

mkrishnan
May 11, 2005, 07:41 PM
Dunno, though, it seems like a very economical package. Although any subscription plan that doesn't have iPod support is...well... Yeah. Nice on paper.

I don't know how I feel still about the burn-to-CD issues. I do like being able to burn CDs....

macnulty
May 11, 2005, 08:05 PM
and AAPL dropped enough for my broker to sell. :( :mad:

why would he sell after the stock dropped?

macnulty
May 11, 2005, 08:11 PM
If there are no choices, then it's called a monopoly...

Nope, not a monopoly. There is choice - WMA and providers or Apple and its' hw/sw offering. You can choose one or the other but the ability not to mix is not a monopoly. Anymore then not being able to mix any other competitive packages or formats.

stcanard
May 11, 2005, 08:34 PM
i guess the subscription market is rather fickle right now, wonder how much all three would drop if Apple entered the market with subscription service?

Kind of expected this. After all with the hardware lock-in both sides are using, this was only going to affect the WMA services -- do they really think people are going to drop their $500 iPods, and buy $500 <hmm, what are the other ones called anyway> just because this service is a little cheaper?

jettredmont
May 11, 2005, 09:33 PM
why would he sell after the stock dropped?

Because many stock brokers work on a "window" philosophy. They expect a stock to trade within a certain "window" of prices, which generally they expect to rise over time (otherwise why be investing in that stock?). If it falls out of the "window", either on the upside or on the downside, it means that the stock is not acting as they expected and so they generally drop the stock immediately, and perhaps investigate and get back in on the stock once the "unexpected" action has ceased (with an adjusted window, of course).

The nice neat little side effect of "drop first, investigate later" is that the broker gets a nice trading commission in most cases.

dejo
May 12, 2005, 12:01 AM
Nope, not a monopoly. There is choice - WMA and providers or Apple and its' hw/sw offering. You can choose one or the other but the ability not to mix is not a monopoly. Anymore then not being able to mix any other competitive packages or formats.

I never said there wasn't any choices. I said "If there are no choices..."

solvs
May 12, 2005, 12:59 AM
I use Yahoo as my home page, but I've had a lot of issues with their services. Especially on FireFox. I don't like subscriptions, and am happy with iTunes (for what little I use it's music service), so I doubt I would be using this at all. I don't think I'm the only one who feels this way.

Real and Napster have a lot more to worry about than Apple.

macidiot
May 12, 2005, 01:40 AM
What other choice do they have???

I don't understand this comment. What was the alternative? Apple has refused to license FairPlay DRM to other music providers, so they have no choice but to go with WMA and Janus. Janus is a good technology is you have no option but to go with WMA.

I think this is a major announcement and could have the potential to rattle Apple's cage more than any competitor so far. It is the first option that seriously undercuts Apple. You can purchase single tracks for 79c.

How are these other companies getting such good deals from the record labels!?? Apple is the industry giant, yet they seem to be the least favoured supplier.


There have been plenty of other heavy hitters attempting to get share. Dell, Wall-Mart, Microsoft, etc. Yahoo is essentially offering the same thing as Napster, Real, and Misfit but at a slightly lower price. Which, if it is any success, will be quickly matched by the others, negating the advantage.

The bottom line is, do any of these services work with the iPod? Until there is any sort of competition on the hardware, the music stores are a moot point.

The problem with Misfit's strategy is that is coming at it the wrong way. The iPod sells songs, the songs don't sell the iPod. Unfortunately for misfit, since they are largely a software company, its all they can do.

And its doubtful that Yahoo is getting any sort of pricing advantage vs. Apple. There is a different, lower pricing scheme for rented music vs. bought music. If Apple offered a subscription/renting service, they would likely receive similar discounted pricing models. Any other differences in pricing would be due to Yahoo et al. selling at a loss to build share. Its not like Napster and Real are making any sort of significant profits...

macidiot
May 12, 2005, 01:52 AM
Because many stock brokers work on a "window" philosophy. They expect a stock to trade within a certain "window" of prices, which generally they expect to rise over time (otherwise why be investing in that stock?). If it falls out of the "window", either on the upside or on the downside, it means that the stock is not acting as they expected and so they generally drop the stock immediately, and perhaps investigate and get back in on the stock once the "unexpected" action has ceased (with an adjusted window, of course).

The nice neat little side effect of "drop first, investigate later" is that the broker gets a nice trading commission in most cases.

Why in the world would anyone use a broker that practiced this? Let alone let a broker execute trades without first getting permission from the owner of the stock? Now if there was a stop loss in place, I suppose that would make sense. But it sounds a lot like churn to me...

Not to be harsh, but its your stock and money. No way in the world would I let some salesperson working on commission control it. If you aren't savvy enough to handle individual stocks, buy an index fund and forget about it. And if your not smart enough to learn or care about what your actually doing with your money... email me. I have some beautiful bridges around New York City I could sell you... :D

840quadra
May 12, 2005, 05:06 AM
I use Yahoo as my home page, but I've had a lot of issues with their services. Especially on FireFox. I don't like subscriptions, and am happy with iTunes (for what little I use it's music service), so I doubt I would be using this at all. I don't think I'm the only one who feels this way.

Real and Napster have a lot more to worry about than Apple.

I agree.

There are many on here that would much prefer owning music as opposed to renting it. PlaceofDis (sp?) had a good point on the thread that preceded this one, in regards to the fact you can rent, listen to the entire track on this service, and later buy it on Itunes, or elsewhere. I don't pirate, and HATE the idea of it, I want to give the artists the money for me owning it, not some record company for renting it. I wonder how much money an artist sees from this service anyway?

I am still deciding if I like this idea for my needs, or if I will stick with the mini preview clips.

What would be cool, is to make the Itunes music store play full song tracks on a small subscription service, so those of us on the fence can listen and scan entire songs before we buy. I doubt that will happen though.
:(