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Speculation arose this past week that News Corp.-owned MySpace Music is considering moving to a paid model, as the cost of free streaming is making its current model unsustainable. News Corp. digital chief Jon Miller expressed some interest in such a move in an onstage interview […]

22891v2-max-250x250Speculation arose this past week that News Corp.-owned MySpace Music is considering moving to a paid model, as the cost of free streaming is making its current model unsustainable. News Corp. digital chief Jon Miller expressed some interest in such a move in an onstage interview conducted by paidContent’s Rafat Ali in Monaco on Thursday, noting that he believes in the “freemium” music model conceptually, even if a practical and sustainable version hasn’t appeared yet. (The audio and video are out of sync, but the segment concerning MySpace begins around the 7:15-minute mark, with deeper discussion of MySpace Music after 12 minutes.)

But even if the freemium model does work for music — and I’m far from convinced that it does — MySpace is so far behind in terms of user interface and experience that it’s hard to imagine the company launching a compelling paid product. A primary reason Spotify has garnered attention is its user interface, and the emerging battle for the music subscription marketplace will likely hinge on a compelling user experience. Consumers already know plenty of places to find free music, and historically they’re only liable to open their wallets for a superior experience. MySpace, however, isn’t seen as a premium provider of anything — and MySpace Music is viewed as a place where clutter and advertising are tolerated in order to get something for free.

What could MySpace deliver that people would pay for? Neither charging to hear music that used to be free nor crippling the free service by taking away music from people’s playlists are very good options, and violate the 10 commandments of freemium. Building a premium ad-free desktop, browser-based or mobile service would merely put MySpace in more direct competition with Spotify — which is having its own troubles satisfying content owners — and other music subscription services that are still seeing more experimentation than customer traction. And for a company that’s already admitted it’s long stopped innovating, MySpace would have to overtake more nimble competitors to draw users to a paid music service while overcoming the perception that it’s a messy-but-free one.

Asked if MySpace Music is nearing profitability, Miller told Ali, “On an operating basis, it’s getting there, but no, because of the payments to the music companies,” adding that he considers a paid model “something to look at.” Fourteen months after MySpace Music’s launch, with the four major labels on board as equity partners, time appears to be running out for its free ad-supported model. It’s worth revisiting Om’s remarks from back then:

If this works, then that is a good statement for the future of the music business. And if it doesn’t, then it tells where the industry is going. In other words, this is a must-win move for the record labels, who are increasingly looking hapless and, well, unable to deal with change.


This article also appeared on BusinessWeek.com.

  1. [...] Would Anyone Pay for MySpace Music? – But even if the freemium model does work for music — and I’m far from convinced that it does — MySpace is so far behind in terms of user interface and experience that it’s hard to imagine the company launching a compelling paid product. (dead on re WTF are these people talking about freemium music model has anyone been paying attention to the last decade… Giga is right about being skeptical and unconvinced) [...]

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  2. The last people you want to be in business with the the record industry – it is the kiss of death.

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  3. [...] 0 tweets retweet » Consolidation appears imminent in the free streaming music sector, as MySpace is on the verge of acquiring social music site Imeem. A source with knowledge of the situation [...]

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  4. [...] que concilie uma oferta grátis com uma subscrição paga. Mas aí coloca-se a questão de saber o que é que o MySpace poderá dar aos seus utilizadores que os incentive a pagar. Certamente que não poderá ser o mesmo que eles já usufruem actualmente de [...]

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  5. [...] from someone who can effectively stop a launch singlehandedly. The trouble is, while free streaming doesn’t work well enough to please record labels, it sure does work for consumers — and taking away what used to be [...]

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