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$20 Million Dollar Experiment to See if You'll Rent a Song for 10 Cents

A music experiment will soon begin with the ambitious attempt to reinvigorate people to buying music online. For just 10 cents you'll be able to select a song to add to your Music Locker to play whenever you like. These aren't obscure or unknown Indie bands like those you'd find on Amie Street, but include nearly the entire music library of the major record labels. This upcoming service has a big backer which might just surprise you.

Here's how the innovative site works. Over 5 million well known songs are browsable in a web layout. Songs are ranked by the number of listens they have received - similar to the strategy MP3.com invented 10 years ago. Each song can played one time in its entirety with the built in flash player. Subsequent plays are limited to 30 seconds. Next to every song is an "Add" button which for a single credit will add the tune to your personal collection. Credits cost 10 cents and each new customer gets 50 credits for free.



Once a song is added it is accessible from your "My Collection" area where it can be listened to an unlimited number of times. The songs are not downloadable so they are not useful for portable players or your mobile phone. There is also no ability to play the songs on Internet radio, game console and DVR devices (like Tivo) as you can with the Locker from MP3tunes. These 'web songs' are trapped in a tab of your browser.

While the advertisements talk about "buying" songs it is more akin to a rental model. The songs and the permission to play them are stored on a remote machine by a company that may discontinue the service at anytime - like a landlord who can change the rules whenever they feel like it. The first time I wrote about this issue I gave the example of the Coke Music store going flat. Then the Virgin Music store ceased operation and most recently the MSN Music Store announced they would pull the plug on August 31st and all purchased songs would go into the coffin as well. If Microsoft, the richest technology company in the world, cannot keep their store going that indicates you need to expect any store to be in jeopardy of shutting down.

The financial backers of this dime-a-song rental concept might surprise you - major record label Warner Music Group. They quietly invested $20 million into a company called Lala late last year (2007) when they devised this strategy. At that time they also agreed to put printed advertisement for Lala into 25,000,000 CDs in exchange for the right to greater ownership. (WMG also sells CDs plus digital tracks through Lala - a concept I first tried with limited success.) Lala has raised a substantial $34.7 million in investment money to date. At the time of this writing, the service is not yet public but it will be eventually at Lala.com's main page.

Will people pay ten pennies for a restricted web song with pseudo ownership? I have serious doubts. People prefer free stuff on the net and there's plenty of it. You can get full length streaming versions of U2's Pride on Napster, Imeem or even better your choice of 6 videos from YouTube for free. So what would convince someone to buy the Lala version?

WMG and Lala's song rental is an admirable concept with a solid design and interface. And it is a positive sign to see the major labels agreeing for songs to go into a personal locker area - (albeit a highly restrictive one). But any locker needs to be open to the world via an API so the music can flow to the car, phone, portable player as well as multiple PCs like we have at MP3tunes. A successful model needs to give more to paying customers not less to compete with free and the omnipresent black market of piracy.

You can try this dime-a-song rental concept before it is publicly launched via this "hidden URL". Let me know if you think people will pay 10 cents to rent a song in the forum.


--MR
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