If It Works for NetFlix...

I wonder how many among my vast legion of readers who scoff at the idea of streaming music subscription services are Netflix subscribers?

If they are, then they’ll want to read this well-reasoned assessment from Billboard analyst Glenn Peoples, who makes an excellent case from numerous angles re: why the Netflix model would work if anybody had the brains or means to apply it to music:

With Netflix consumers have proven they will rent content – even re-run content – and stream it from the cloud. They will pay for digital content they could get for free through illegal means. They will pay if the service allows streaming through multiple devices – including mobile….

If a music service can reach the scale of Netflix, it too can pay rights holders handsomely while continuously improving the product and giving subscribers a high level of service. In the first quarter, Netflix shelled out $192 million for the acquisition of streaming rights on top of the $377 million it paid to rights holders related to its subscription revenue.

I have had several occasions over the past couple of years to engage Glenn Peoples in some discussion about music delivery systems, subscription services, etc.  The problem usually is that Glenn’s side of the discussion is informed with facts, data, and astute analysis – while my side is typically “by the seat of my pants” and fueled by a tankful of attitude.

So it’s nice to see that we are in complete agreement on this particular analysis.  The music industry has much to learn from Netflix, and music “consumers” (listeners, users, fans?) have much to gain if the industry can ever have muster the fortitude to follow Netflix’ lead.

Netflix: A Subscription Model the Music Business Should Aspire To | Billboard.biz.

iTunes In the Cloud?

Amid reports last week that Apple is quietly lining up licenses for some kind of “cloud” service from the major labels, the debate about “access -v- ownership” likewise begins to show up in popular channels, like this post from Brad Hill at the Huffington Post:

That is really what the cloud represents: a different concept of ownership….

Most people dont like this deal, because it’s not true ownership. Drop the subscription, and you lose all your music, because it’s not really your music. I get that. But here’s the thing. It feels like ownership, and in the end, thats what counts to me and the minority loyalists who embrace music subscriptions. I feel like I own 11-million music tracks, because I can access them, transfer them, and listen to them as if I had bought them on iTunes.

Lets imagine I did buy them on iTunes. Id be at least 11-million dollars poorer right now — and believe me, I cant afford it. How much have I actually spent? Over 10 years, at $15 a month, Ive dished out $1,800 for ownership rights to a vast celestial library available anywhere, anytime.

via Brad Hill: Music Lockers vs. Subscriptions: Music Ownership in the Cloud Era.

Count me among the “minority loyalists” who continue to believe that “access” to $11-million worth of music for some nominal monthly fee is an infinitely superior model than chunking out 99c per track to own a very limited catalog (for “consumers,” anyway.  I’m still not convinced it’s a viable model for the creators.).

And the idea of “cloud-based storage lockers” — like Amazon introduced a couple of weeks ago, like Google is supposedly developing, like Michael Robertson pioneered a decade ago — likewise leave me thoroughly underwhelmed.

Here’s the simple fact that even Apple would prefer you not grasp quite yet:  all the music you could ever listen to in your lifetime is already stored “in the cloud” — i.e. on servers somewhere. The guardians of that vast library continue to dole it out to us in 99c chunks, and then think they’re doing us some kind of big favor by offering to “store” it for us remotely, so that we can have “access” to our purchases from “anywhere.”

Well, all of that is a crock, and it is only a matter of time before the music-listening public catches on to the fact — and subscription services catch fire.   Buy your stock in MOG and Rdio now.  Hell, Apple might still be a bargain at nearly $400/share.

Remember, 10 years ago, the “experts” were doubtful that music fans would actually pay even 99c for downloads – and now that is one of the most common ways that music is distributed.  There is only one constant in the digital era, and that is: habits change.