Jonathan Arber
Omniphone - a new approach to mobile music
Yesterday, UK company Omniphone officially announced the forthcoming pan-European launch of its MusicStation mobile music solution, in collaboration with Musiwave. The service will allow mobile consumers to download unlimited music to their device over-the-air for a weekly subscription fee. The MusicStation client application is Java-based (there is also a Symbian version), and will apparently work on 75% of handsets currently in the market.Comment: Omniphone certainly seems to have a healthy list of players on board. Its partnership with Musiwave, which will handle the music licensing and back-end platform, brings with it relationships with 35 operators in 25 countries, and it has already announced launches with Vodacom and Telenor. In addition, the fact that it is handset agnostic and optimized for lower-end handsets gives it a large potential market, and allows operators to market the service beyond those consumers with high-end music phones. MusicStation also offers a fairly impressive range of music discovery features such as a recommendation engine and community functions. The service is certainly attractive to operators for the reasons stated above, and because they can launch MusicStation as co-branded service, and run it in addition to, rather than in competition with, their existing digital download services. The question is, will it tempt consumers to part with their cash? £1.99 per week for unlimited music doesn't sound like much, particularly when you consider that the average full-track download costs £1. However, the difference is that MusicStation users will have to keep their subscription active in order to keep listening to the music they have downloaded. In addition, Europe is predominantly a prepaid market, and many users may be put off by the idea of committing £8 per month - particularly when you consider that average monthly prepaid ARPU in the UK is only around £10.The service also seems to go against increasing consumer desire for, and awareness of the issues around, interoperability. While subscribers can choose to pay an extra £1 per week to use the service on their PC, they are still heavily restricted in what they can do with the tracks they have downloaded. Indeed, this is one of the key problems facing the subscription model on both fixed and mobile platforms - it is inherently restrictive because of the need for consumers to renew their subscription every month (or week in the case of MusicStation). While providers of these offerings see them as a transition away from thinking about music as a product to be purchased, and rather as a service to be experienced, the indicators are that consumers don't currently feel the same way.Most press coverage of MusicStation has positioned it as a potential iPhone/iTunes killer - but we think this is a little premature as Apple has yet to announce details of an over-the-air iTunes service. While MusicStation certainly has potential due to a large reach in terms of devices and a range of attractive features, we still question whether a subscription service will be able to find favour in a predominantly prepay market.
