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Summary:

Half a year after formation, the music subscription service spun out of Omnifone is readying to go at the unlimited-access opportunity – but all such hopefuls will be challenged to go against Spotify.

massey

Rara.com, the unlimited-music subscription service spun out by Omnifone, has appointed a Coca-Cola business veteran as its first CEO, as it begins this summer to vie for a slice of the emerging segment.

Nick Massey spent 13 years at the drink-maker in a variety of business roles, before spending the last three years as chairman and CEO of the  Cadogan Venture Management investment vehicle.

Rara.com was formed in December after Omnifone lost several contracts for its pioneering cross-platform, mobile-centric unlimited-music service MusicStation. Omnifone decided to focus on being a B2B provider, spinning MusicStation’s customers out in to the new entity.

Massey tells paidContent the outfit is “still in launch phase”, so he isn’t disclosing user counts. A full launch is expected this summer.

After the success Spotify has had in the new unlimited-subscription segment, any rival service will, frankly, find it challenging:

  • Mog sold to Beats Audio for relatively small money.
  • We7 flipped to more of a radio model before essentially giving up and selling to Tesco.
  • Rdio isn’t shouting about user figures yet either.
  • Only Rhapsody, which has been going for a decade, is holding a candle to the Swedish firm, and it has had to buy Napster’s subscribers to keep apace.

So Rara.com will need to bring something different to the table…

“Rara.com targets a different consumer,” Massey tells paidContent.

“While services like Spotify focus on those who always know what they want to listen to, Rara.com caters for the consumer who feels like listening to music, but doesn’t necessarily know exactly what they want to listen to.

“We provide a very easy to use, hand-curated service, with channels and playlists providing music to suit every mood.”

That is the same thing each of Spotify’s rivals, including Rdio, say. Spotify, whose “What’s New” homepage curation is lightweight and not well thought of, tends to say that its curation is best executed by user-created playlists and by new third-party “apps” inside its desktop application.

One way Rara.com may be able to compete is by striking bundling deals with hardware manufacturers and larger paid services – an area in which Omnifone’s MusicStation excelled but in which Spotify has not had much success.

“Marketing is clearly going to be a very important area in delivering Rara.com to consumers across the world,” Massey adds. “We will be announcing more on our plans in the near future.”

The firm is likely to seek fresh capital to propel its go at the opportunity. “Rara.com will continue to raise funds as needed while we develop and grow,” Massey said. Omnifone CEO Jeff Hughes told me in March: “Omnifone doesn’t currently a stake in Rara. My guess is there will be a fundraising round.”

With Spotify having resourced itself with around $188 million in funding, and rumoured ready to take another $220 million more, fundraising for Rara.com would absolutely be my guess, too.

Update: A Rara.com spokesperson added: “Rara.com has been privately funded to date and will look for additional investment as and when appropriate in future.”

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  1. Dan Ketterick Wednesday, July 18, 2012

    Hard to hear if it’s worth ra-ra-ing about if you can’t even see what tracks are available without hitting a paywall.

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