At least regarding digital distribution of music. Admitting a problem is the first step toward solving it, or just blowing it off:
That’s the lesson industry insiders are drawing from the surprise decision by Sony Music Entertainment and Universal Music Group (UMG) to sell their service, Pressplay, to Roxio.
“The marketplace has changed,” Sony Music executive VP Robert Bowlin says. “We are in the content business. We don’t have to own the highway necessarily unless it is strategic to do so.”
….”It’s pretty clear that want to step out of the management role and just hold an equity position,” Jupiter Research analyst Lee Black says.
For the major labels, their venture into digital music has proved to be a costly lesson as well. Building the business has been neither cheap nor easy.
Sony and UMG have pumped an estimated $60 million into developing Pressplay since its 2001 launch. A similar amount has been spent on MusicNet.
But the services have only an estimated 100,000 customers between them and virtually no name recognition among music fans.
….In making a deal with Roxio, owner of the Napster brand, UMG and Sony are looking to solve the problem of Pressplay’s lack of brand recognition.
Roxio plans to relaunch the digital-music service by early next year under the Napster name, which is still the most recognized among consumers for digital downloading.
….Roxio, which plans to retool Pressplay to make it easier to use before rereleasing it as Napster by March 2004, is expected to make a la carte downloads a feature in its service.
Plans to incorporate into the MusicNet service a greater focus on a la carte downloads are also in the works. [Billboard]
Inevitably, when the labels try to do the service themselves, their paranoia over “protecting” the content interferes with usability, marketing, and availability.