Instant Music Stores?

Discussion in 'MacRumors News Discussion (archive)' started by MacRumors, Dec 16, 2003.

  1. macrumors bot


    Apr 12, 2001
    #1 reports on an upcoming service to be offered to businesses by Loudeye Corp in partnership with Microsoft.

    The new Digital Music Store service from Loudeye and Microsoft will allow companies to quickly launch their own online music stores. Two early customers of the new service include AT&T Wireless and Gibson Guitar Corp.

    The file format offered, of course, will be Windows Media 9. Loudeye will act as a middle man, allowing companies to launch services without going through negotiations with record labels and the process of creating the infrastructure required.

    In related news, Destra has relaunched their music download service in Australia also based on Windows Media. (Note: Destra's service is unrelated to Loudeye).
  2. macrumors regular

    Jul 22, 2002
    NOVA, or Northern Virginia to the lay person.
    I awlays wanted my own music store. Where do I sign up?
  3. macrumors 6502a

    Jan 20, 2002
    Washington DC USA
    If Apple doesn't make any/much money on iTMS I don't see how Microsoft can. Loudeye would cut profit margins even more.
  4. macrumors member

    Jan 4, 2003
    You Too Can Do This!

    Wow, you too can open your own online music store. Just list a whole buncha links into iTunes music store.

    Of course, you won't get squat in revenue from it, but either are the big players.

    Plus, you better hurry before your corner Texaco convenience store beats you into the market. Rumor has it that they are opening an online music store too.

    Hurry, don't be the last one on the planet without your very own music store!
  5. macrumors 6502

    Feb 22, 2003
    this sounds dangerous. Giving more companies the tools to create their own online music stores... using wma files.

    But I'm not too concerned because I believe itms is going to blast after the pepsi and maccas promotions. And if worst comes to worst, I'm sure apple could teach the ipod to play wma files. I seem to recall steve saying they were considering all available options, but just didn't see the point right now of allowing other music store downloads to go on the ipod.

    edit: are there any articles on wma vs aac vs mp3 for sound quality? I encoded some stuff on the pc at work on wma on the best setting and it was horrible. I had to assume I had an old program or wrong settings.
  6. macrumors 68020


    Nov 8, 2003
    New Zealand
    There are going to be some big failures towards the end of this year as companies record big losses from down loading music
  7. mvc
    macrumors 6502a


    Jul 11, 2003
    As they said at the end of the .com boom - "what's the business model?"

    Its all over again!

    Lots of me-too stores sprout up now, each trying to flog off some custom hardware/software to justify the loss-leading song downloads, but three years from now there will only be a handful of major stores and lots of kids closets full of cheap no-name mp3 players with no music to download.

  8. macrumors 68040


    Feb 26, 2003
    around the world
    In the end only a very few will survive. And Apple will be one of them. I am sure.

    Because there business model is based on selling hardware - iPods. Thats where the profit comes from. Not from the store.
  9. macrumors regular

    Jul 1, 2002
    San Francisco, CA
    Where does it say that Microsoft needs to make a profit? Like any monopolist, Microsoft can lose money on their media store indefinitely (see "extracting rents"). Microsoft wants to turn Windows Media 9 into a "de facto" standard and squeeze out MPEG-4/AAC, Apple QuickTime, and Real Helix. This is known as vertical foreclosure and is a type of monopoly maintenance.

    They've already squeezed out their own previous versions of their Media Player through the use of "optional" security updates which force upgrades/introduction of their Media Player 9 DRM as well as changes in the EULA.

    The court has not yet ruled on whether or not this particular instance fits the legal definition of monopoly maintenance. Because Microsoft is a convicted monopolist, they are supposedly prevented from entering into markets that already have adequate competition (which IMO this certainly qualifies)*. Given the political situation, I doubt action will come in the United States. I imagine the European Union's reaction will depend on how Microsoft enters the market--for instance, will they strong arm OEMs to include the Windows Media music store icon on the desktop by default? Will the music store be activated automatically by software update**?

    Microsoft hasn't been successful lately at foreclosing markets: internet service (v. Yahoo, AOL, EarthLink), airline ticket sales (v. Travelocity/Sabre, Orbitz, etc), game consoles (v. Sony and Nintendo), PDAs (v. Palm and now Linux), cell phones (v. Symbian and now Palm), embedded (they were doing well until Linux entered), enterprise servers (Linux has won, Windows 2003/IIS is a niche product), enterprise apps (too many competitors to list)... So I'm not going to start running around saying the sky is falling just yet.

    In any case, even if the attempt doesn't work, I doubt Microsoft will make a penny until they've squeezed out Real and Apple. (Don't count out Real. One of the big "selling" points of LoudEye/Windows Media 9 is the distribution of content onto cell phones where RealOne Mobile is doing very well.***) In the meantime, they can disguise losses by folding R&D and some marketing budgets into their OS or Enterprise divisions--both of which make a hefty profit.

    The FUD machine is in full force and has been bringing up the spectre of Apple's proprietary past every time iTunes Music Store and the iPod get mentioned. I think this may be a good thing because it'll force Apple to open up their DRM to other parties to counter it as soon as iPod or iTunes Music Store market share start slipping.****

    And even if Microsoft forecloses this market, I can still eek out some enjoyment. Given the estimated potential size of the downloadable music market (est. $1.25 billion next year), I have no doubt that Microsoft has some plans to screw over LoudEye in a couple years and I'll get to see that unfold. I'd bet it is somewhere along the lines of how they screwed over Stack or Sybase.

    * This reminds me of the origins of Unix. Most of what we call Unix is in the public domain because AT&T was a monopoly at the time and could not make money out of the code they created so distributed Unix without any copyright. This particular monopolist, OTOH, has much less federal oversight and they live and die by their proprietary software.

    ** I'm going to pre-empt all of you who are going to point out that this is how Apple introduced iTunes Music Store. Apple is not a monopolist, legally or economically. Remember, monopolists are forced to play by different rules because they have an unfair advantage (see again, extracting rents).

    *** Just a personal note: I saw a commercial for mp3 ringtones and thought, "Is this most compelling argument that some marketer could think of for bundling a music player with a cell phone?"

    **** No, this hasn't happened yet. In fact, some of the retail channels for the iPod are dry. Yeah, great for Apple, but bad for me. I want to see Apple open up FairPlay and make a fair playing field.
  10. macrumors regular


    Jul 22, 2002
    New Jersey
    You must first consider...

    Microsoft does not want Apple gaining any marketshare in any way, shape, or form, whatsoever.

    iTMS & iPod are opening the doors to just that type of thing.

    What M$ is trying to do is flood the internet music buying service / experience with GARBAGE. This is an attempt to basically smother the competition (if you can't beat 'em smother them enough to distract).

    They can afford to loose tons of money due to Windows.

    I can see them putting ads in all versions of Windows sold.... or at least links for this disservice.
  11. macrumors regular

    Jul 22, 2002
    NOVA, or Northern Virginia to the lay person.
    I have a bad feeling that all these music stores and players, and their incompatibilities with each other, are just going to seriously confuse people. Music download formats should be as standardized as VHS, DVD, and CD audio media. Each music player manufacturer should be responsible for making their hardware work multiple popular formats. I think we are a long way away from that happening.

    In the mean time, Apple should market their portable music player and music store as the most simple and powerful combination available (because it already is).
  12. macrumors regular

    Sep 20, 2003
    This is not going to work.
    It's going to put companies in the hole even faster now. And it's going to make Microsoft richer.

    So the companies don't ....

    wait. I don't know..could this work? Do all operating costs go to this Loudeye-Microsoft partnership, while the company makes whatever profit comes out of it and pays for the service?

    Don't know if there's much money to be made, if at all. But I think in the long run, this could work out very well. They help you make some money, while you help them make some money. The essence of business. And with Loudeye-Microsoft offering this service to many companies, it could be very good for them.

    Leave it to Apple to be innovative, leave it to Microsoft to be profitable.

    Cheers to them. Creating more competion for Apple...there's been a lack of that lately :D
  13. macrumors 68000


    Sep 8, 2003
    Tampa, FL
    Technically things aren't standard anymore since the introduction of consumer writeable formats....VHS is VHS true...but DVD isn't DVD to consumers..there's DVD+R/RW and DVD-R/RW for video plus DVD-RAM for data....there's CDs of many, many formats other than strictly audio uses including VCD.....I agree that there should be a level of standardization but sometimes that dooms you to using crappy formats...I'd hate it if .wma **** encoding was the standard...AAC is much better...even the dated MP3 is better and far more universal....oh and NON DRM'd! Oh and don't you just love how they say CD-R's may not play in everything? I haven't come across a single player that it doesn't work in...I guess it's possible, I mean my mustang's CD player doesn't seem to like some of them as much when I try to eject them, but I hardly see that being a problem with the CD-R since the discs that have slight problems were windows discs...the mac discs work perfectly and are the same media...indeed, things are messed up though...

    punter, all my experience with WMA encoded audio has been terrible...I have not come across a single song encoded in WMA that has sounded good...
  14. macrumors 68030


    Sep 18, 2003
    London, UK
    Yes, but wasn't iTMS turned off in preferences by default? Therefore Apple was covering its back? My new PowerBook (which came with iTunes 4 pre-installed) had the Music Store turned off and there was no sign of it unless I went to the preferences. Although, maybe that has something to do with the fact that I'm here in the UK...

    Me too!
  15. macrumors regular

    Apr 19, 2002
    Death by a thousand cuts

    I'll quickly reiterate the previous mentions of trying to force any format other than WMA out. Saturate the marketplace then hope you're licensing deals with hardware providers makes up the difference as far as revenue goes (remember Microsoft makes a tiny amount for each WM9 license it sells via portable players).

    The only incentive I can see for people to even open these stores is to attract advertising dollars for their special interest portal site. Amazon profit sharing for music downloads basically. Every small niche business can now incude a catalog of music that fits their customer base, similar to how you'll find New Age, Ambient at a candle store or Punk/Hip-Hop at a skate shop or bargain bottom bands at 7-11.

    It's an interesting concept but it seems to be overkill in the implementation.

    Wouldn't it be easier to just provide an API and a partner code the way Amazon does it? You can sign up, get your code, create your list of songs and for every click-through/download you get a couple cents. How much room for competition on prices can there possibly be? The margins are nearly air-tight as it is.
  16. macrumors regular

    Mar 23, 2002
    Yes, it might be a ploy just to make WMA the dominant download format. Once you control the medium, the money is sure to follow.

    Everyone keeps mentioning how Apple does not make any money on iTunes but that might not be exactly true. Maybe they only make a penny per song which is enough to start a business. I doubt there would be as many competitors if there were large negative profits. (though one can write business loses off one's taxes)

    I think Apple should counter with the same instant store that uses AAC files instead of WMA or do something to encourage AAC use. Maybe build it into the quicktime infrastucture or something. Apple was the dominant player in the home PC market in the begining. Then they were forced out by cheaper more widely used alternatives (and dirty tricks). The same thing might be happening again.
  17. macrumors newbie

    Jul 18, 2002
    Wouldn't it be something if the iPod WAS the format of choice and followed in the footsteps of the industry standards such as VHS, CD, DVD etc?

    I'm guessing that 99% of current/potential music player owners won't care about the format the music is in, they will just want to know that it works as well as popping a CD into a discman regardless of whether they're listening to a AAC, MP3 or WMA file.

    If they can make sure the DRM offers the same choice and security, I'm sure Apple will support any format that becomes dominant.

  18. macrumors 6502a

    Sep 16, 2003
    Akron, OH
    I think this is what Apple needed to do last summer. Get companies to create their 'own' music store (in looks only) and that will directly be linked to the iTMS servers.
  19. macrumors 65816


    Sep 1, 2003
    And don't forget that all these downloads will be in craptacular WMA format which because people are sheep think is the industry "standard," with the "but it's Microsoft it's gotta be good, right?" [loud buzzing 'wrong answer' sound]. Morons.

    Not that I'd want my iPod to play crappy WMA this isn't going to help say the soulless unthinking Windoze followers who could be fed a plate of crap by M$ and ask for a heaping seconds. Those owning iPods and enslaved to that platform (or potential buyers) will wonder why they can't download music from these services and play them on their iPods.

    It's a potential mess.
  20. macrumors newbie

    May 3, 2001
    Providence, RI
    How does Microsoft make so much money?

    They never put out any competing products. They just put out sabotage machines that ruin the entire market.

    It's like, "if I can't have it, no one can."

    I say if this comes to fruition, then Apple should dedicate itself to producing a completely compatible office suite for Windows and sell it for $19.
  21. macrumors 604


    Jul 16, 2002
    back in NYC!
    Thank the Lord....

    My grandmother wanted to start her own music store. :rolleyes:

  22. macrumors 65816


    Jul 24, 2002
    South Orange, NJ
    The same 2 problems.

    Well, looks like this suffers from the same 2 problems that ANYTHING from Microsoft does:

    1) It makes a bunch of totally unreleated and hard to find things instead of centralizing them.

    2) It requires you use their proprietary spyware.

    ... and to think that companies will use this under the guise that it's a good practice!

    The problem with this plan, specifically, is that we now get to have a bunch of little independant music stores with the same rent-like DRM that requires a user have WM9 (on Windows). *Yeah!* I can't wait to be suffocating in a mire of horrible DRM practices!
  23. macrumors 603


    Apr 21, 2003
  24. macrumors 6502

    Feb 22, 2003
    Side note:I found one web page that analysed MP3 vs AAC vs WMA.
    (go to the second page, it explains the results)
    AAC killed it. The author of the page plays down the problem with WMA as a "curious " dropoff at 14kHz. Wow the graph makes WMA look stupid.

    And that would explain why symbols sound pathetic under WMA.
  25. macrumors 65816

    Oct 24, 2003
    AAC is the way to go not WMA.

    Microsoft = WMA
    Dolby = AAC
    Which would you want??

    MS must be planning to lose even more money then other music stores if it's going through a middle man. So it just goes to show you going this route they don't care how the music store works just as long as they have one and it snuffs out other Music Stores.

    This just another reason that shows MS doesn't give a damn about the end user experience.

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