The four largest handset manufacturers in the world are setting up a music service with major music publishers. They hope to use the new product to compete with key features of the Apple (NASDAQ: AAPL) iPhone. According to the FT, Nokia (NYSE: NOK), Motorola (NYSE: MOT), Samsung, and Sony Ericsson will offer a flat-fee music service in Europe and Asia.
The new initiative will take music from Warner Music Group (NYSE: WMG), Universal Music, EMI, and BMG.
Although the service will not begin in the US, there is every reason to think that it will head here. The new "MusicStation" service will be preloaded onto phones.
Access to iTunes is one of the major selling features of the iPhone. The large handset companies have good reasons to want to make the iPhone less attractive. If its sells well in the US, it will almost certainly be offered overseas, and the big phone manufacturers will be waiting with features to keep its sales low.
Douglas A. McIntyre is a partner at 24/7 Wall St.
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Reader Comments (Page 1 of 1)
6-15-2007 @ 3:49PM
george said...
Did you think up the spin for this all by yourself?
Is there any competition for iTunes? Anywhere? At all?
Are you posturizing that a consortium of companies that couldn't create a music service on their own suddenly could together?
Are you still on the pipe?
The main focus of the iPhone is hardly it's music downloading capability but it is a nice way for Apple to enhanse their revenue stream going forward.
History shows us that the flat fee music download service concept mentioned has failed in the past and is typically propigated by technology stratigists who just don't get it.