BMG JOIN THE BANDWAGON August 25 2000 dotmusic.com Whitney Houston, Santana available soon as downloads. BMG has become the latest record company to sell digital music online, leaving Warner Music as the only label not to join the Internet download revolution. 50 individual songs and 50 albums are going to made available, including some of BMG's biggest acts like Whitney Houston, Toni Braxton and Santana. Singles will be priced from $1.98 to $3.49 with albums at between $9.98 and $16.98. As with EMI's strategy, downloads will be sold through a number of Web-based retailers. BMG have not named their retail partners but say that they will include Internet branches of traditional record stores: a plan designed to prevent alienating the "bricks and mortar" shops that account for so many CD sales. Controversially, BMG's vice president of business development Sami Valkonen has struck out against flat-fee subscription services, oft-mooted since the rise of Napster. Whereas Sony and Universal are said to be collaborating on a system which will enable listeners to download huge quantities of tracks for a monthly charge, BMG are unlikely to tread the same path. "We don't really believe in the all-you-can-eat-model...it doesn't give you the advantage of mass customization that allows you to target certain music to certain customers", he said. "Also, our research shows us that customers will download all the music they want in the first two months and then not use it very often after that...they're being charged for something they don't get much value from." But as long as record companies continue to sell downloads priced as expensively as $3.49 for a single song, the all-you-can-eat model will continue to be highly attractive to customers. To compete with the likes of Napster, labels like BMG will have to prove that they too can offer great value. comment on this article e-mail this to a friend start a discussion [about i-drive] writing index thoughts dotmusic index Problems? Questions? Suggestions? Contact me: mail@tobyslater.com back to top back to home page

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