Digital Hollywood: Music Industry

The “Music Industry Innovates into Future — From Digital Downloads and Subscriptions to Digital and Internet Radio” panel: The home media server is the next, nearest-term thing according to this panel. When asked what they would buy with $1000 for Christmas, they mentioned a number of devices that they think will be compelling: Omnify, Linksys, Lyra, Prismiq. These devices will enable music consumption in ways not easily available today (i.e. come home and call up the latest Billboard Top 10 on your stereo).

Another theme that persisted is the diversity of models and digital music solutions that will be available. Downloads v. subscriptions v. advertising supported — all variations were supported by different members of the panel. eLabs’ Susan Marks mentioned that the economics for streaming subscriptions and downloads are different, with downloads being more lucrative to labels and therefore will preferred by the industry.

An interesting exchange regarding subscription v. downloads occurred. Amanda Marks from eLabs believes that download stores will far outstrip subscription services in the near-term. Mr. Wolpert didn’t directly respond, but later in the discussion he mentioned that RealNetworks is “extremely” pleased with subscription levels on Rhapsody. He commented that the acquisition looked very speculative when announced, but is now a big win. It’s clear that Rhapsody is central to Real’s offerings going forward.

Interesting panel comments:

Amanda Marks, eLabs — Windows Media 9 is dominating the market (in her view).

Richard Wolpert, RealNetworks — Roster of big players (Apple, Phillips, Palm, Nokia) that are actively not supporting WM9.

Kelli Richards, Independent Consultant — Phillips is strongly anti-WM9 due to Microsoft’s onerous licensing strategies.

Jim Van Huysse, AOL Radio@ Network — Music & Mobile: We’re dabbling now, but nothing near-term.

Jacob Kaldenbaugh, founder and senior analyst at Harvest Equity Research is guest blogging the Digital Hollywood Conference. Check out the full coverage on dedicated conference page.

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