Fortune Magazine (via CNN Money) has a rumors-are-rife story that Nokia (NYSE:NOK) is planning an online music service to rival iTunes. While there’s no confirmation on this from the company, it’s a move that is expected from Nokia and wouldn’t be the first time it had moved into the content portal space…it’s still backing the Ngage platform. Fortune writes that “Nokia CEO Olli-Pekka Kallasvuo will launch the new worldwide service Aug. 29 at a London event that will include live music at the Ministry of Sound nightclub. The new Nokia Web site will let consumers download songs to their PCs and transfer them to mobile phones and other portable music players, similar to Apple’s iTunes. Nokia is expected to let users transfer songs to non-Nokia phones using digital-rights-management software”.
This move has been linked to the incipient arrival of the iPhone in Europe (where it will hit later this year), but it’s more likely a reflection of the weakening power of operators in keeping their customers on their own portals (which has been hastened by the iPhone, admittedly). “Mobile music customers are gravitating away from portals in favor of other conduits. Research firm M:Metrics says that 85 percent of the 32.2 million people who listened to music through their phones from February to April in the U.S. and the EU’s five biggest countries bypassed operator portals.” If Nokia gets the service out in Europe in Autumn it should beat the iPhone, at least in terms of arriving first if not in terms of hype. Fortune suggests the new service will have “more than a million songs”, less than the current number on iTunes but more than Apple started with.
Sony Ericsson president Miles Flint also hinted the company was looking at the music-downloading business, which should surprise no-one. As this becomes more common it will benefit operators to offer as many different music portals to their customers as they can — they get kudos for “openness” and prevent any single portal from becoming too dominant.
Rafat adds: Nokia bought the assets of Loudeye last year, and has been threatening to launch the music service ever since. I hope they do something about the crappy battery life of their multimedia phone (the N95, for example, the one I have) before they wants us to use it on a five hour cross-country flight.