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|iPod vs. Zune vs. Rhapsody, Part 2|
|As I opined in Part 1, I am a fan of the subscription music concept, even though the market-dominating iPod/iTunes system eschews it. Although Rhapsody, Yahoo! Music, and other subscription services have been slowly growing, the popularity of the iPod suggested a general lack of consumer interest in "renting" music.|
Microsoft's upcoming Zune might change that. Although it's late to the party with a generally "just ok" player to be built by Toshiba, the Zune has one key feature that the iPod does not: the ability to share and exchange music wirelessly with other Zunes. I think this could be a big deal, a step way beyond instant sharing by two people splitting a set of earbuds.
In order to work within the music publishers' need for copyright protection DRM Microsoft is also going to be launching a subscription music store of its own. A subscriber would then be able to zap songs wirelessly to other Zune-owning subscribers without the publishers losing out.
There are two drawbacks. One is that the new Microsoft service will reportedly not be compatible with the existing PlaysForSure standard used by Rhapsody et al, an ironic and annoying move since PlaysForSure is Microsoft's own "standard".
The other is that this wireless feature sinks or swims according to the network effect. The most oft-quoted example of this is fax machines. These were more or less useless extravagances until a tipping point was reached where enough other people had them to make them convenient, then essential. The Zune wireless sharing feature is more or less useless until a number of your friends also have Zunes. This can cut both ways, as it did with the fax machines. Once a beachhead is established it can encourage people in your circle to get Zunes to take part in the fun. But you might end up being the dork with the Zune while all your friends have the latest iPods, which in the world of geek/youth fashion, is death for the new product.
Where does this leave Rhapsody and co? They might be able to put enough pressure on Microsoft to merge the new Zune service with PlaysForSure so that everyone can participate. This would be good for Zune in making it an obvious MP3 player choice for all the existing customers of the services, but runs against the idea that Microsoft want to have a tightly integrated offering like iPod/iTunes to make things as simple and reliable for the consumer as possible.
Rhapsody is fighting back with some strong partnerships of its own. It's working with high-end home digital music adapter maker Sonos to simplify delivering music to the home, and with SanDisk (who have quietly grown their MP3 player sales to become number two after Apple) on a co-branded Sansa Rhapsody.
|Related Technorati tags: iPod iTunes Rhapsody Yahoo PlaysForSure Zune Toshiba SanDisk Sansa|
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