Europe's Legitimate Music
Download Sites Rush To Beat iTunes
London, UK - Feb 5, 2004 (PRN): The
European music download scene will turn around in 2004. Many consumers who have routinely
downloaded for free will become resigned to paying for legitimate services. Portals will
benefit first; Apple's iTunes and Napster will win in the long run.
"Attempts to stop illicit
downloading in Europe have failed so far," said Forrester Senior Analyst Rebecca
Jennings. "But commercial sites just need to be patient as the market gradually
changes. In 2004, a combination of legal action by the music industry and expansion of
legitimate services will cause a watershed in the download market."
Privacy law has stopped anyone from going
to jail yet, but Forrester believes that the threat of a lawsuit is enough to make
consumers consider legitimate downloads. Also, several dozen sites already sell legitimate
downloads in Europe -- from portal offerings like MSN Music Club to retailer sites like
Fnac. OD2, the service powering many of these, already has nearly 0.5 million registered
users, according to the IFPI. More launches are planned: Apple's iTunes should finally
reach Europe this year; Napster is expected, too; and Coca-Cola's January launch --
although hit by technical difficulties -- shows that even consumer goods brands want to
get in on the act. New features increase the attractiveness of paid-for services.
Also, the UK's Wippit allows consumers to
continue their peer-to-peer behavior without violating digital rights, and firms like
Tiscali Music Club allow downloading to devices like portable players. In the longer term,
new devices like the Windows Portable Media Center will allow consumers to download and
watch videos and interviews as well as music tracks.
The various distributors are all trying
to establish early-mover advantage in the embryonic European commercial download market.
Portals will take an early lead, Coca-Cola will fizz, but most consumer goods firms will
fall flat, and iTunes will bite back.
"In the lull before Apple and
Napster get to Europe, portals like MSN and Tiscali will take the lion's share of the
nascent market," Jennings added. "They benefit from strong brand names, high
audience penetration, significant marketing and cross-promotional capabilities, and -- in
the case of ISPs -- an established billing relationship. However, those that retain
unwieldy, inflexible services -- such as requiring purchase of credits before songs can be
downloaded -- will be hit in the longer term once easier-to-use competitors come along.
Big-bucks marketing campaigns, a deal to sponsor the official UK music chart, exclusive
tracks, and competitions for hot tickets to events like The Brits will make Coca-Cola's
offering succeed -- assuming the launch-day problems aren't repeated. But there will be
little room left for other consumer brands. Those tempted should pay heed to Unilever's
and Procter & Gamble's ill-fated ventures into the teen portal market a few years ago:
Who remembers Wowgo or Swizzle now? But over time, Apple's ease of use, seamless linking
with the hot iPod, and enormous brand traction will see it overtake many of the smaller
services in Europe -- as has happened in the US. Napster may give it a run for its money
in the ease-of-use stakes but will suffer from lower brand awareness in Europe."
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