This past Monday, I moderated a panel at the Digital Hollywood conference in Santa Monica, California. The topic: Establishing the personalized mobile music experience. While the panelists didn’t reach any earth-shaking conclusions, it became clear that mobile is definitely the final link in the evolution of music’s transition from a product-based business model to service-based future. Once we have ubiquitous access to music on mobile devices, the revenue model will rely on access, not ownership. But, wait a minute, aren’t we already there with Nokia’s Comes With Music and Omnifone’s Music Station? Not exactly, we’re close, but no cigar.

On paper, they both seem like great deals. You buy a designated music-optimized handset from either Sony-Ericsson or Nokia & you are then permitted, over the next 12-18 months to download as much music as you like, at no extra cost. Even better, both services allow you to permanently keep a quantity of your downloaded music. So why aren’t customers buying into these offerings in more significant numbers?

Both services seem to have trouble resonating with consumers. According to figures released last week by Music Ally, there are 107, 000 subscribers globally, with the strongest uptake in emerging markets. Omnifone hasn’t released any user numbers and have been unusually quiet recently, the last announcement on their website was last April.

The apparent inability of Nokia and Omnifone to message their value propositions to their target audience has resulted in an underwhelming uptake of either service. This is truly an unfortunate turn of events. Both companies have crafted excellent services, offering mobile customers a cost-effective way to access and acquire a substantial music library. Omnifone takes the experience further, allowing fans to manage their libraries via their PCs. Both services deserve a second look and they may both be helped by an unlikely benefactor, Spotify.

Its meteoric success has created an unprecedented consumer awareness of the advantages of a well-executed music service. Pandora and Slacker each present excellent offerings, but neither provides for instant gratification, the on-demand delivery of the song you want immediately, at your fingertips. With the introduction of Spotify’s iPhone application, mobile music has finally moved to center stage. Omnifone and Nokia need to exploit the halo effect afforded by the public’s love affair with Spotify. They need to simplify their message; focus on their strengths, there’s room for robust competition in this nascent marketplace.

While I’m admittedly a big fan of Spotify, I have great respect for Comes With Music and Music Station. They deserve the chance to find their audience; I hope they make the most of it now.

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