It is certainly no secret that Apple has grown into the dominant music retailer. Nobody is even close to them in the digital realm. Amazon is a distant second.
This raises the question “Is there enough room for the Imeems, LastFMs and Spotifys of the world?” Good question. On the surface the answer would be yes, of course. There are certainly a number of different models that are emerging every day. I happen to really like Spotify. And with Spotify’s new mobile client, a subscriber would no longer need to buy any tracks from iTunes. Ok, so the tracks might expire when the subscription expires, but for heavy music consumers it’s a pretty good deal. Great interface. Great functionality. And well-crafted content licenses that can make it all possible, and I know from experience that breaking new licensing ground with record labels ain’t easy.
Imeem certainly has the users, but is in search of a viable business model. They’re in the position where they can turn on a dime and make the necessary adjustments to survive, provided that the labels cut them some slack. A story in the New York Times last week suggested that the majors are starting to see the light (see the post on my blog “Commentary: Are Record Labels Having A Sunni Awakening?”). But, as the saying goes, “in the world of the blind the one-eyed man is king.” Let’s hope that the record labels have eyes wide open finally.
But what is overlooked is that whatever “special” licensing agreements that Imeem and Spotify and their ilk have been able to hammer out, Apple can surely get as well. Apple is in the position to crush any and all competitors as they are in the perfect position of being on both sides of the transaction—providing the software and the hardware. And, of course, in spite of the coolness of the Spotify mobile app, will they be able to make it work on the Touch and iPhones? Apple could surely block them if they so desire. And that’s where Apple firmly holds the position of gatekeeper.
Let’s face it, Amazon MP3, Rhapsody, Napster, etc. are all mere afterthoughts in the minds of consumers. And I hope that Imeem and Spotify make it. But the major record labels created their own Hobbesian choice by having ignored the digital world for so long. It is way too late to dig them out of the hole. They’re slaves to Apple.