This stunning chart needs to be put in some context to understand the true nature of the upheaval facing what I like to call the “Dinomedia”:
2) FREE can actually work, with a little creativity: “How Girl Talk mashes up the Music Biz”.
3) Sony’s new “idea” to launch a me-too Music subscription service priced the way they are proposing is 1) Doomed, and 2) fails to take the reality of the above chart into account:
“Sony believes its huge userbase and retail presence can help its subscription music service succeed where countless similar services have failed.
The Basic tier of service — which will cost $3.99 per month in the U.S. — gives users a set of curated music channels with the ability to fast-forward and rate songs. That’s very similar to what users can get for free from Pandora and countless other Internet radio stations, as well as the free music channels on digital cable TV systems.
The Premium tier — $9.99 per month in the U.S. — is the same price as countless other subscription services (Rhapsody, MOG, Rdio, Microsoft’s Zune Pass, and so on) but doesn’t have any mobile story [yet].”
Their retail presence?! Really? That is exactly the portion of the music business that is dying completely. I thought Denial was usually one of the earlier stages of the “5 Stages of Grief” model…
Why can’t they understand that they have next to NO PRICING POWER left? (Again: Many cannot be bothered to STEAL their product anymore…).
That they are much better off gaining whatever Attention Pie/eyeballs/earballs they can for their music ecosystem (and make further back-end sales there later on, similar to what ONE LONE, yet innovative DJ is able to do)?
For example, what if Sony were to do something bold, and price the “Premium” subscription at $1/month, no contract. That would put it in the complete impulse purchase, don’t-need-to-think, will-likely-never-cancel-for-any-reason category.
What if they could thereby garner 100 Million users, who would be spending about $1.2 Billion, in other words…about 20% of what still is left of the global music industry?!
At that price, could they get 200 Million users? One would hope so. Given that Apple is expecting to sell 40M+ iPad tablet computers costing $499 and up this year alone…
Wake up, #Dinomedia, before it is forever too late…