Doomed from the start
There’s no shortage of people lambasting the recording industry for keeping their business model firmly behind the times. The ability to download music online seems to have presented the industry with a challenge it simply can’t accept. They have a hammer that’s been serving them well for a very long time, and by god they’ll bash away at this problem even though it no longer in any way resembles a nail.
I’m not going to rehash the arguments or the history here, but needless to say, the recording industry has very firmly clung to the the premise that no matter how much money you pay, they must retain control over what you do with that music.
Enter a new business model that is doomed from the start. Lala.com presents a model that is essentially a rental scheme. I found out about this site via Slashdot and Michael Robertson. Lala has a large number of songs on it (over 5 million) that you can search, listen to from start to finish once, and then add to your playlist for 10c. Once the song is on your list, you can play it whenever you like.
Here’s the catch: you can only listen to the song via the Lala website.
Ok, that’s not entirely true, you can (sometimes) pay more money and buy the track in mp3 format, but the new business model Lala is going for is clearly listening to your 10c tracks via their website. They get to control everything because you stream the music. You can’t put it on any devices or burn it to CD.
So why is this doomed from the start? To be fair, I’m sure there would be some people who would be happy to pay such a small amount of money to be able to listen to their music from any Internet-connected computer, but I’m not one of them.
I generally listen to music in several places using different devices. In the car, I’ll listen to music on the radio, on CD, or on my iPod. At the gym, I’ll listen to their music or my iPod. At parties, I’ll listen to music from a stereo via an iPod, CD, or yes, a computer. And sure, sometimes I’ll listen to music at home or at work from a computer. The vast majority of my music-listening is done via a little plastic disk or a little portable music device.
Now, there’s some criticism of the restrictions forced upon you from online music stores like iTunes. iTunes lets you download music, but the files contain DRM that restrict what you can do with it. According to the website, you’re allowed to burn it to CD as many times as you like, and copy it to as many iPods as you like. You can only put it on up to 5 computers though. Not much of a restriction – who has more than 5 computers?
Lala on the other hand won’t let you burn to CD and won’t let you put a track on a music device, but they’ll let you play it on as many computers as you like (via their website). For me, that means I can no longer listen to my music in the car, at the gym, or anywhere without an Internet connection. That’s a deal-breaker for me, and I’m sure for a lot of people.
The argument is between consumers who want to be able to purchase something without strings, and record companies who want to control their rights and insist that you’re only buying a license to play the music they still own. Launching a website that tightens control over what you can do with the music is stupid. It’s giving people the exact opposite of what they want. Mark my words, this idea will fail, and it will fail hard.
Update: Ars Technica, Wired, and CNet have written about this beta of Lala.com now as well. The general feeling seems to be similar to my own – they’re unsure of the 10c streaming model. Also, see the comments section of this post for a reply from one of Lala.com’s employees.
I think you have a problem with your argument. You claim consumers want to be able to purchase something without strings and yet you also point out that lala also sells MP3s, which are exactly that. Now, somehow because there is another option: pay a lesser amount for streaming from anywhere prior to purchasing the MP3 that somehow something is being taken from the consumer. And we let you upload your entire collection to make it accessible anywhere. Oh and we also sell CDs.
So what, exactly are we giving consumers that is the exact opposite of what they want? Perhaps you want to argue the price is wrong? Well that is your prerogative, but then you should have written a different post. Oh, one more thing. If you pay 10 cents for a song on the web that amount gets deducted from the MP3 price. So, again, I don’t get your argument, but then I work at lala.
Oh, and yes you “heard” about this from Michael Robertson. Perhaps it is possible he has some stake in this with his obviously competing site, mp3tunes.com? Given that perhaps one should take his comments with a grain of salt?
By the way, we will (nearly) always have the MP3 associated with the web song. The site is in beta and not yet released. Content is being added every day. If any of this requires clarification, feel free to contact me by email.
Hi Geoff,
Thanks for your input. I stand by my comments, and here’s why.
Yes, you can by mp3s from the site. I did mention that fairly early on in my post. If the sale of mp3s is your primary aim, then that’s fine, you’ll directly compete with the likes of iTunes and Amazon music. But let’s face it, it’s clearly not your intended business model.
I understand that you’re still in beta, but one could easily be forgiven for thinking MP3 is not always going to be an option. Take the first search I did for example; U2. There were 272 tracks, and two MP3s. If I’m wrong, and by the time it goes live there’ll (nearly) always be an MP3 option, then I apologise. I can only go with what I see. Again, that’s clearly not how you’re differentiating yourself from the other online stores though.
Perhaps calling the idea “the exact opposite” of what consumers want was a little misleading. My suggestion was that while consumers are asking for less boundaries on what they do with their music, your site’s unique model – the one referred to in big letters that sets it apart from the competitors, its innovative feature – restricts them even more. That seems like the opposite to me.
Is the price wrong? I don’t know. But it doesn’t matter how low the price is if nobody wants the product. I wouldn’t use it but I’m only one consumer. Maybe my finger is miles away from the pulse, but I doubt it.
As for hearing about it via Michael Robertson, it’s true, all true. I even read his piece before looking at lala.com. Hell, he even refers to his site in a positive light in his article. I am, however, able to form my own opinion, and I seriously don’t think people would be willing to purchase music (for whatever price) that they can only listen to while sitting in front of their computer.
Look, if I’ve offended you with my opinion, then I’m sorry you feel that way. The purpose of my post was to suggest, in no uncertain terms, that I think the 10c listen-to-it-when-you-want-but-only-on-my-site model is not a good one. I can’t imagine using it, and I don’t really know anyone who would. If you want to compete directly with Amazon’s 89c DRM-free tracks by offering your own 89c DRM-free tracks, then good luck to you. I hope you get a big chunk of their customers to switch to you.
Damian Brady
Hi Damian,
No offense at all and thanks for taking the time to check it out. A couple more notes. You are right that all you have go on is the site and I freely admit that everything is not yet fully baked. We are working on it though!
We seriously, deeply want to provide consumers with what they want, when they want it. There are obvious restrictions placed on what we can do by the industry, our costs, technology, etc. But we really do believe we can create a GREAT experience for consumers and will do everything we can to realize that. And if all the pieces aren’t there at once and we catch flack for it, well, that’s life. We also recognize that this model won’t work for all consumers (at least not today). That is fine, we just hope and believe that there are enough out there for whom it will be great.
But to clarify. Our intention is absolutely to have an MP3 for every song for which we have a license. So far we have all the deals to get these, but, sadly, not yet every MP3 on line. We will!
Now, we push the 10cent song because (1) it is new (2) it reflects our vision of the future (3) we think it will work great for LOTs of music listeners (but certainly not all). Personally I use lala all the time and NOT just because I am an employee. It happens to be convenient for me to listen to on computers very frequently and I love lala for that.
Best,
Geoff
Hi Geoff,
Honestly, it’s great to see a company taking an interest in what is written about them, particularly on a seldom-visited blog like my own!
I did have a suspicion that there were industry forces restricting what could be done. It’s fairly unlikely that someone is going to suddenly be able to launch a site with much cheaper repeatable downloads with no DRM. It’d take a big change in thinking by the record companies. Amazon and now the MP3 downloads from Lala are a definite step in that direction.
If the intention is to have an MP3 for every song, then that’s great. Hopefully this will attract a lot of consumers for you. I still think the 10c track will have limited uptake, but for your sake, I hope I’m wrong.
On another note, one thing that would definitely pique my interest is if MP3s can be bought by residents of other countries (I’m Australian). Currently there are few if any (legal) DRM-free MP3 options for anyone outside the US. Again, that’s probably something that’s out of your hands to a large extent.
So good luck, and thanks for visiting!
Damian
“Not much of a restriction – who has more than 5 computers?”
*raises hand*