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Saving the music biz?


By Scott Bradner


Obliviously I am going to write about Apple's new music downloading service.  As a Mac fan and someone who has been whining for quite a while about the inability of the music industry to reason their way out of a wet Kleenex, how could I not do so?


With a level of hype that far exceeds its market share, Apple Computer launched its on-line music service at the end of April.  After the launch, the coverage was generally fawning with Fortune mag deserving an award for its cover picture of Apple prez Steve Jobs listening to an iPod stuck in Sheryl Crow's waistband, with a screaming headline claiming that Jobs plans to "save the music biz."


Well, so far, so good.  A week later Apple announced that more than a million songs had already been downloaded using the service.  (The Apple press release announcing this fact included the obligatory statement from a music company executive who said that he would have considered the service a success if it had sold a million songs in the first month.)


Two dozen of those million were from me. (Some classic Johnny Cash and the three "exclusive" Bob Dylan tracks.)  The system worked just as one expects from Apple, completely intuitive and fast.  The system even figured out that I was in Ottawa Canada when I signed up and told me that the service was not available in "your country" yet unless I had a credit card with a U.S. address.  The wonders of staying with geographic-based licensing in an Internet world.   


A million songs in a week when the system only works on a computer that has less than 3% of the market.  This seems to indicate that there just might be a business in this stuff after all.  Apple's service is not the only one around but as far as I have found itŐs the easiest to use and as the model that makes the most sense.  Of course, it might just be that Jobs succeeded in getting the music folk to sign up just because Apple has such a small footprint, less risk that way.  And there is some risk. It was only a few days after the service started up that instructions were floating around the Net on how to rip off the songs after they have been downloaded.


But the point is not that a few people, maybe even a lot of people, will cheat.  The point is that a whole lot of people seem to be willing to be honest.  I do not think that honesty is a special feature of Apple computer users so I expect the same will be true with Windows users when the service expands to them later this year.


I do not know that Jobs will save the music biz, but he may make them think for a few nano seconds and figure out that suing their best customers for billions in damages may not be the best business model.


disclaimer:   There may be a class at the B-School covering the business model suing stones to get blood, but I did not check and the above business advice is mine alone.