Paying for downloads and receiving streaming music for free through ad-support makes sense because that is how the world is structured now - if you think about radio as streaming.
The problem with downloads now is that there are only two options - pay or piracy. Ad-support offers a third option. This option will appeal to those who are cash-challenged, eg. young people - the biggest consumers of music. Those who can afford it may choose to buy the music they like, although they may go the ad-supported download route for testing and sampling. If you think about how much time people spend listening to music (ad-supported music monetizes time) the music pie is a big tent under which lots of options can prosper.
The problem with Qtrax is that it is not an ad-supported download service. Like Spiralfrog, it gives tracks to users as payment for spending time on the website. The economics won't work for them and the effectiveness of the ads won't work for their advertisers. History teaches that paying an audience to spend time with an ad never works.
Qtrax are claiming they will play on the iPod in a couple of months , I have to wonder if they will use DVD Jons DoubleTwist Ventures reverse enginneried DRM .
And from what I'm gathering they hook into Gnuttlea and filter the content on Qtrax .
This model may work and if it doesn't I wonder when the labels will investigate the collective licensing model like that proposed by the EFF.
Tech For Novices
· 1 year ago
See the Yahoo AP news article "reproduced" by us for a laugh !
Bob
· 1 year ago
If I can't listen on my Blackberry then nevermind.
Boris M. Silver
· 1 year ago
If this grows, someone will make a nice DRM hack to make your music portable (a lot of college kids have a hack for the Ruckus player), although it would probably just be easier to download it strait on an illegal centric P2P service like Limewire.
I think this is just one more wall falling and eventually everything will be DRM-free (hopefully). The market force is too strong.
"I want to be able to play the music in any device (sonos, pc, mac, iPod, Blackberry, etc, etc)." Couldn't agree more -- question is how do they throw advertising or some sort of monetization around you transferring/moving your music around.
fredwilson
· 1 year ago
Advertising in a download seemes foreign to me
a 15 second spot every three songs on a free on demand streaming service does not
It might be that I grew up with and love radio and am totally used to that experience
Fred
twillerer
· 1 year ago
It seems like this is a lame attempt of the labels to take the control back from a. consumers, and b. apple.
And, I agree: streaming should be free and downloads should cost (and on that model, I prefer something like eMusic).
fredwilson
· 1 year ago
Amazon mp3 is a good alternative to emusic
I wish both of them well as they are indeed the best way to buy music online
Fred
JonathanMarks
· 1 year ago
I agree that the DRM route is totally flawed. I think the type of ads will become an issue. If they are dynamic ads that are in context many people won't mind. But the old model of interruption ads is also getting difficult to sell to people under 30, at least in Europe. My interviews with kids in different parts of the world indicate a willingness to pay a small monthly sub for access to music (feels like free) as part of a phone subscription.
Hank Williams
· 1 year ago
"My gut tells me that files should be paid for and streaming should be free and ad supported. Curious what you all think."
There is no market for audio internet ads at the present time. My gut tells me this will not change. Even if it did, CPMs would likely be exceedingly low, requiring huge inventory *and* huge sell through to succeed. I think no one beyond apple can gain critical mass to achieve both of these (and they wont bother). I suspect Even Last.fm will fail at this inside CBS, though we will never see those numbers broken out. But there is no market for national audio advertising (on or off the internet), and local requires to much inventory and an aggressive on the ground local sales effort.
fredwilson
· 1 year ago
Hank
Radio advertising is moving quicky to the web
Last year over 100mm of radio ads were sold and run on the web
That's a market and its growing quickly
We have a play in this market with targetspot and from my vantage point the market is real, growing, and attractive
Fred
Andrew Wise
· 1 year ago
Speaking from a competitor to Qtrax, I was pretty impressed or even shocked when they made the announcement they had support of all 4 majors, and over 25 million songs, but as we seem to peel away each layer of this onion, it gets worse and worse.
Building a network around advertising is akin to what radio, TV, newspapers, ...everyone in the media business has done for ages. The problem, however, is that all of these media players are having one hell of a time keeping their audiences listening to ads. So for Qtrax to rely solely on advertising, we definitely think it's a step in the wrong direction, but since they ARE our competitors, we applaud them for paving new ground for other players in the industry.
But the key thing everyone is missing, ie the Ruckuses, Spiralfrogses, etc. is that you can't expect people to use your free product, if it doesn't compete with the already free product, Limewire that's out there now. And to tell me you can't compete with free, is ridiculous, ...just look at the bottled water industry.
DanRunion
· 1 year ago
So I pay for access to the music, don't get a file, but can play it anywhere, and on anything?
Sounds like a winner to me. Actually the fact that I don't have a file on my machine that I need to backup is a value add.
phoneranger
· 1 year ago
OK. Will ad-supported music services like SpiralFrog and Qtrax make it? Maybe not. They have to work in a uniquely challenging environment with finicky self-important consumers on one side and 'problematic' suppliers (i.e. labels) on the other. But how easy will it be to be an ad-supported TV network, radio station, newspaper, magazine or anything in the near future? It's the brand advertising model that's broken. Martin Sorrell has been critical of internet 'business models' of late. I wonder if he's got one of his own that'll last until 2010?
medyum nisa
· 1 year ago
Couldn't agree...
davidporter
· 1 year ago
Generally agree on last point, esp for radio-style streaming b/c (1) it is largely promotional (rather than substitutional) vis-a-vis music acquisition, and (2) it represents a "lesser form" of content access since end user lacks full interactivity (and even on-demand streaming is "lesser" today without ubiquitous broadband access). I think that this suggests the higher volume / lower ARPU model of advertising.
vadadean
· 1 year ago
All "free" P2P services must face reality and compete against "free" piracy. By burdening the consumer with ads, DRM, and the lack of iPod play, Qtrax seems to be a poor competitor to piracy.
The more generalized notion of advertiser dollars creating a broadcast model for P2P can work but it must serve the user's desire to be entertained, informed, or socially rewarded. Traditional ads tend to interrupt these needs rather than satisfy them. This is exactly where we will be experimenting.
I'd like to challenge the notion of streaming vs. downloading. As bandwidth and storage costs become negligible, downloads simply become persistent caches for cloud content.
Paul
· 1 year ago
I read about Qtrax in the newspaper, downloaded the software and to be quite frank I haven't a clue how the hell it's meant to work. I've never even heard of peer to peer downloads before, and the site doesn't explain how it works whatsoever. To make things worse when I opened it, an article was displayed within the songbird window about Oracle Application Server, whatever the hell that is! Total disaster.
Gerald Buckley
· 1 year ago
Fred, it sure looks like someone let the cat out of the bag prematurely. The solution had all the right bits - intrigue, buzz, high hopes/expectations.... but they left one important bit out... The signed agmts with the labels.
They may have some kind of iPod solution in their back pocket. It might even be DVD Jon's FairPlay crack. Whatever it is... it's doomed to fail as, at it's heart, it relies on DRM of one kind or another or a hobbled play on a proprietary platform that is renowned for trumping the jailbreakers.
It can't scale given the current economies and lack of streaming.
BTW, their media relations person never phoned me back. Am thinking they're circling the wagons.
All Comments
The problem with downloads now is that there are only two options - pay or piracy. Ad-support offers a third option. This option will appeal to those who are cash-challenged, eg. young people - the biggest consumers of music. Those who can afford it may choose to buy the music they like, although they may go the ad-supported download route for testing and sampling. If you think about how much time people spend listening to music (ad-supported music monetizes time) the music pie is a big tent under which lots of options can prosper.
The problem with Qtrax is that it is not an ad-supported download service. Like Spiralfrog, it gives tracks to users as payment for spending time on the website. The economics won't work for them and the effectiveness of the ads won't work for their advertisers. History teaches that paying an audience to spend time with an ad never works.
Check out the Ad-Supported Music Central blog: http://ad-supported-music.blogspot.com/
Thanks
Fred
And from what I'm gathering they hook into Gnuttlea and filter the content on Qtrax .
This model may work and if it doesn't I wonder when the labels will investigate the collective licensing model like that proposed by the EFF.
I think this is just one more wall falling and eventually everything will be DRM-free (hopefully). The market force is too strong.
"I want to be able to play the music in any device (sonos, pc, mac, iPod, Blackberry, etc, etc)."
Couldn't agree more -- question is how do they throw advertising or some sort of monetization around you transferring/moving your music around.
a 15 second spot every three songs on a free on demand streaming service does not
It might be that I grew up with and love radio and am totally used to that experience
Fred
And, I agree: streaming should be free and downloads should cost (and on that model, I prefer something like eMusic).
I wish both of them well as they are indeed the best way to buy music online
Fred
There is no market for audio internet ads at the present time. My gut tells me this will not change. Even if it did, CPMs would likely be exceedingly low, requiring huge inventory *and* huge sell through to succeed. I think no one beyond apple can gain critical mass to achieve both of these (and they wont bother). I suspect Even Last.fm will fail at this inside CBS, though we will never see those numbers broken out. But there is no market for national audio advertising (on or off the internet), and local requires to much inventory and an aggressive on the ground local sales effort.
Radio advertising is moving quicky to the web
Last year over 100mm of radio ads were sold and run on the web
That's a market and its growing quickly
We have a play in this market with targetspot and from my vantage point the market is real, growing, and attractive
Fred
Building a network around advertising is akin to what radio, TV, newspapers, ...everyone in the media business has done for ages. The problem, however, is that all of these media players are having one hell of a time keeping their audiences listening to ads. So for Qtrax to rely solely on advertising, we definitely think it's a step in the wrong direction, but since they ARE our competitors, we applaud them for paving new ground for other players in the industry.
But the key thing everyone is missing, ie the Ruckuses, Spiralfrogses, etc. is that you can't expect people to use your free product, if it doesn't compete with the already free product, Limewire that's out there now. And to tell me you can't compete with free, is ridiculous, ...just look at the bottled water industry.
Sounds like a winner to me. Actually the fact that I don't have a file on my machine that I need to backup is a value add.
The more generalized notion of advertiser dollars creating a broadcast model for P2P can work but it must serve the user's desire to be entertained, informed, or socially rewarded. Traditional ads tend to interrupt these needs rather than satisfy them. This is exactly where we will be experimenting.
I'd like to challenge the notion of streaming vs. downloading. As bandwidth and storage costs become negligible, downloads simply become persistent caches for cloud content.
They may have some kind of iPod solution in their back pocket. It might even be DVD Jon's FairPlay crack. Whatever it is... it's doomed to fail as, at it's heart, it relies on DRM of one kind or another or a hobbled play on a proprietary platform that is renowned for trumping the jailbreakers.
It can't scale given the current economies and lack of streaming.
BTW, their media relations person never phoned me back. Am thinking they're circling the wagons.