XM+Napster has gone into Beta. I am a huge fan of XM Radio, and am also conversant the the virtues and values of Napster. I appreciate the value of being able to build a music library in Napster, which you can either listen to on-line or download to a portable music player. I buy tracks from Napster and load them to my Treo 650. I am the tricked out gizmo queen of the Jersey Shore.
However, I don’t understand what value the alliance between XM Radio and Napster brings to me, the ever hungry music consumer. Is it a way of increasing brand recognition for each product line? Creating pass-through sales? Ganging up to fend off Sirius and Real Player?
What’s the deal, in your opinion? What am I missing about this alliance?
I don’t get it either. I’m willing to go with a subscription model for satellite radio, because I get lots of channels besides just music. However, I am not willing to go with a subscription model for music downloads. If I hear something on XM that I like and don’t have, I’m going to get on iTunes and download it once for a buck (assuming I just want the single and not the full album, which I would probably buy the physical CD for instead of downloading the album through iTunes), not pay a bunch of money every month or the downloaded tracks stop working. Besides, the DRMed WMA doesn’t work with my iPod, though of course I could come up with workarounds, at which point I could let the subscription lapse anyway without losing the ability to play the music. But that’s a lot of work and will result in even more quality loss than just getting the thing from iTunes in the first place.
CBCD, looks like you hit most of the points that I could see.
First, looks like they are trying to get pass-through sales by making it trivial to buy songs you just heard while listing to one of the XM channels. Second, they feel that there are users that want portable devices that play both satellite radio and MP3, so they are encouraging device-vendors to create such devices. With these devices, they can build an XM+Napster brand as a one-stop-shop. Third, they are positioning to add enhanced services (e.g. record XM programs).
The press release indicates support for 70 XM channels, that’s a subset of XM, right? Not sure how many simultaneous downloads you can have nor am I sure what the cost is for this service. I suspect it is a cheaper than the services combined, but you get a bit less of each service? If that is the pricing, then this combo could also help gather subscribers from people that want both services, but don’t want to spend that much for both. For example, a new user buys a car with XM and uses the 90-day trial. He thinks, “Hey XM is great, but I don’t want to pay $15 a month for this – I am already paying $10 a month for MP3s”. Once people are hooked, they could upgrade to a more expensive and complete service.