Blog Post

The Money In Online Music

This story states the obvious: very few are making anything, for now. Reasons? Competition, marketing expenses, a faulty business model, slow-changing consumer attitudes and the use by some companies of music as a lure to sell other goods and services have all conspired to keep the business largely in the red.
“It will be at least three years before anyone can make a serious profit selling digital music,” largely because of the hold that Apple has on the market, says an analyst.
MusicNow, the digital music service now owned by AOL unit, is profitable, says Neil Smith. But that has a lot to do with being able to defray marketing costs across AOL’s huge user base, he says.