In a week of increasing noise from the digital music subscription sector,
Chicago-based FullAudio is fine-tuning plans for a revamped — and
renamed — service that adds unlimited tethered downloads and streamed songs
for $9.95 per month.
With analysts positioning FullAudio as a prime candidate for an
acquisition, most likely by Microsoft , the company’s
rebranded MusicNow service will join competitors in offering song downloads
for 99 cents each when it is launched on Friday.
The company is positioning the new MusicNow as a shift away from the
“search-and-browse” database model to a complete “entertainment experience,”
that will feature paid radio channels targeting a grown-up audience.
For $4.95 per month, the company will sell access to 36 radio channels.
A channel will let paying subscribers listen to premium radio stations or to
play on-demand relevant content like hit singles or programmed bundles of
music and entire albums.
FullAudio CEO Scott Kauffman made the announcement at the Digital Music
Forum in New York City, making it clear the company was targeting those
music fans who are willing to pay to avoid the congestion and intricacies of
the illegal file-sharing networks.
“Illegal file downloading services, such as Kazaa and Morpheus, are less
effective at meeting the needs [of busy consumers] since these large
databases of music require consumers to spend hours ‘hunting and pecking’
for individual songs,” Kauffman said.
“We’re going after the consumer with little time and an abundance of
money, not the consumer with little money and an abundance of time,” he
added.
FullAudio, which makes no secret of its tight relationship with
Microsoft, is revamping to compete in a crowded market of big-name
subscription services. MusicNow pricing appears in line with that of its
rivals and even includes concessions on download-and-own for consumers.
MusicNow from FullAudio will look very much like Listen.com’s Rhapsody service, which also offers custom
radio stations for $4.95 per month and a $9.95 monthly plan that allows
unlimited streams and access to burn songs for 99 cents. (Listen.com is
running a promotion on Lycos where subscribers can download and burn songs
for 49 cents each).
It appears all the competing services have settled on a price tag.
America Online’s just-relaunched MusicNet on AOL
service offers 20 streams and 20 downloads for $3.95 per month and an $8.95
per month plan for unlimited tethered downloads. A pricier $17.95 per month
option on the AOL service will allow users to burn 10 songs to a CD.
Pressplay, the service backed by
Sony, Microsoft and Yahoo , also offers radio stations
and unlimited tethered downloads for $9.95 per month in addition to song
downloads that allow for CD burning.
For FullAudio, which has licensing deals with all five major record
labels — Bertelsmann AG, EMI Recorded Music, Sony Music Entertainment,
Warner Music Group and Universal Music Group — the new sales strategy comes
amidst talk that the company would be a buyout target for a bigger company
with deeper pockets.
“We view FullAudio and Listen.com as possible takeover candidates. They
both have good technology but that doesn’t necessarily mean financial
success,” said Greg Lee, a research associate for Raymond James & Associates.
“Those services haven’t taken off and they’re absorbing major losses. With
Roxio’s plans for Napster coming along soon, it will be very tough for them
to survive alone,” Lee told internetnews.com.
Lee predicted the fee-based digital music landscape would soon be in the
control of the big-name tech firms and music labels. “The standalone
services all have very good products but they haven’t gained much traction,”
Lee said. This opens the door for the deep-pocketed companies, like
Microsoft, Yahoo, RealNetworks or AOL to gobble up the
struggling companies, he added.
