MTV has announced that they’ll partner with Microsoft, rather than Apple, to sell media over the Internet. Says MTV Networks Music Group President Van Toffler:
“[Apple Chief Executive] Steve Jobs has a point of view,” Toffler said. “ITunes is about a digital storefront for a la carte downloads. Our goal is to create a utopian music community that keeps subscribers coming back.”
This will, of course, fail miserably for two reasons:
The media that they’re selling won’t be usable with the devices that constitute 80% to 90% of the market.
Their “utopia” is subscription-based, which is a model that, when given a choice, consumers rarely choose.
Pronouncements like Toffler’s fascinate me. Is he really unable to see how this will end? And if so, is it ignorance or denial? Isn’t he in essence saying, “We know that consumers have spoken as clearly as they could, but we think they’re wrong”?
2 Replies to “The Way of All Utopias”
It will fail as Napster 2.0 did for the reasons you mentioned. Nobody wants to rent music. Buying music online is an impulse thing. Setting up a subscription and accepting a monthly tap on your credit card requires commitment, something the typical MTV viewer lacks (in spades).
The WMA device vendors are getting desperate to the point of outright attempting to clone the iPod and its interface but for whatever reason can’t seem to do it right.
Not only can’t they do it right, but, as this analyst points out, even if they could, Apple would still have a price advantage based on their tremendous market share and volume advantage. In most markets, the approach that would work for the WMA device vendors would be to offer something that Apple doesn’t, but in a market where compatibility is so important, that’s a far less effective strategy.