RealPlayer chief: Subscription will work
Published: 31 Oct 2003 14:25 GMT
Is there any support left inside Real or outside for MusicNet (a joint venture between Real, America Online and several record labels)?
MusicNet, interestingly enough, is the second-largest online music subscription service. We own lock, stock and barrel in No. 1, and we're the largest single shareholder in No. 2. MusicNet, near as I can tell, has a very solid relationship with AOL...The reality is there will be a variety of services out there. For us, it's the best possible outcome: we're the 100 percent owner of No. 1 and majority owner of No. 2.
Is Apple's iTunes, which is gaining a lot of exposure, plus QuickTime, a threat to Real's software?
We have had a multidimensional relationship with Apple for some time...The thing Apple has to decide -- not for us but for the industry -- is whether it wants to be completely vertically integrated, in which only things invented in Cupertino are used and promoted on the Apple platform, or whether it wants to be a broader platform. It's hard when you have a single-digit share of the market, because you have a hard time figuring out how to grow your business. So I understand the lure of going in that vertical direction. But Apple's already lost things like Adobe Premiere on its platform.
Does it want the iPod to only talk to the Apple version of the store, or does Apple want to sell iPods no matter what method (consumers want to use to) connect to iTunes? So there's this Soviet model, or there's the open-market chaotic model, exemplified by the Web and by some aspects of Wintel. And Apple has to choose.
So it's better for you if they stay in that niche market?
Either way, it's fine. Apple makes fine hardware. If Apple opens it up so that other people can support, then that's good. If Apple stays "company down" on everything they do, then the market forces over time will render them into the kind of niche we've seen them in time and time again.
Is there much of a profit margin on digital downloads as opposed to selling subscriptions?
I understand the lure of going in that vertical direction. But Apple's already lost things like Adobe Premiere on its platform.
We think that the services model long term is a better deal for everyone...Our take on it is the business of selling tracks will be a low-margin business, with low barriers to entry and lots of people jumping in. The business model we've focused on with subscriptions as the centre will have the best long-term economics.
Previous
Did you find this article useful?
151 out of 334 people found this useful
Digg
Slashdot
Del.ici.ous
Stumble
Reddit
