Music will be a tough payoff for Facebook


Last week Om broke a big story on Facebook’s plans for music. A new dashboard will accommodate multiple third-party digital music services from companies like Spotify, enable music streaming while still in Facebook, and incorporate sharing, recommendation and syndication technologies like Connect and Like buttons. As Om describes it, Facebook’s scheme sounds cool, and music is a natural fit for the dominant social network. But is it Facebook’s next billion-dollar business? Not likely. Here’s why.

In my weekly update at GigaOM Pro (subscription required), I go into more detail on the challenges Facebook faces in monetizing digital music and look at the best way Facebook can cash in.

Image courtesy Flickr user corazón girl



This isn’t about being a next business market. It is about catering to the friends who post music all the time from YouTube. This is not irrelevant, and simply provides an equivalent experience to MySpace music, which is probably the only thing keeping it alive.

With near complete penetration, creating services and experiences that will keep users is critical.

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