[HU]
Hopefully, we’ll be able to continue downloading free tracks from file-sharing sites for some time to come. But do free downloads mean that there’s no market for selling music through the appropriate or, shall we say, legal channels?
For
Apple Computer, which has sold several tens of thousands of iPods in Hungary, the iTunes downloading market is really picking up, but it’s a market that’s still far from mature. Internet penetration in Hungary remains among the lowest in the region, according to research firm GfK Hungária Kft, and illegal pirating of software is still high, though decreasing somewhat. Illegal downloads are especially high among home users, said Emanuele Massimo, general manager of Apple IMC Hungary, the local representative of Apple.
No survey has yet been carried out in Hungary to work how many of the country’s iPod owners are actually downloading iTunes onto them; but, in fact, it’s not just that people download tracks for free that’s holding back the downloading of iTunes.
“There are also legal aspects [i.e. royalties to music companies] and market size to consider. Unfortunately, we’re not yet ready to discuss the regional introduction of iTunes,” said Massimo.
Concerning iPod sales in Hungary, the Hungarian copyright association (Artisjus) adds a tax of up to 10% on iPod music players, which is among the highest such levels of tax not only in Europe, but worldwide.
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Sadly, this encourages many companies to cheat, which in the end leads to unfair competition and to lower Artisjus revenues. VAT also plays a role, of course,” Massimo noted.
Motorola has teamed up with Apple to form a strategic alliance, and two of the pair’s jointly developed mobile phones, the E1 and E2, have already been launched on the market. Customers can download direct from iTunes in countries where currencies and payment methods allow it.
“This is not yet possible in Hungary, however, as iTunes can be purchased only in euros in mainland Europe, so we’ll have to wait until Hungary joins the euro zone, said János Suga, country manager of Motorola Hungary Kft.
Most of Motorola’s new high-end handsets are music-capable phones with built-in mp3 players, such as the V3i, V3x, L7, and V360.
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There’s big potential in the music phone market, and the choice portfolio is rapidly growing. However, users are still reluctant to download from official sources due to fear of DRM [Digital Rights Management] and price issues, or just because they’re not in the habit of buying online,” said Suga. “
But this will change with time and the launch of new services.”
Of the Motorola phones, the V360 with a built-in mp3 player is one of the most successful, while the V3x is among the top-selling 3G phones in Hungary, according to Suga.
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Thus, on the local market, we’re well represented in 2.5G and 3G with music-capable phones,” he claimed.
Nokia, too, wants to cash in on the action. The company announced in August that it plans to buy Loudeye Corp. for $60 million in a bid to challenge Apple in the market for music downloads.
Greig Williams, managing director of
Nokia Hungary Kft, said it’s still too early, however, to speculate about the details of its music store.
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Our objective is to develop a non-proprietary global mobile music store that will be available in all relevant markets and countries,” he said.
Williams added that by acquiring Loudeye, Nokia will be able to offer a comprehensive mobile music experience to consumers, including devices, applications and the possibility to purchase music.
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Music is a key experience for all Nokia N-series multimedia computers and a wide range of other Nokia phones, and we want to provide the best possible mobile music experience for our customers,” said Williams.
Commenting on Nokia’s entry and other market developments, Massimo said it is inevitable there will be some convergence of mobile device functions in the future.
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What analysts and especially end-users should be cautious about, though, is that any convergence at all very often results in completely unusable, non-ergonomic devices,” said Massimo. “
We at Apple believe that the top priority is to give consumers a powerful, multi-functional and intuitive device that is still easy to use.”
For its part, Nokia aspires to deliver the best possible mobile music experience, and this means also providing the possibility to purchase music.
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We can achieve this by offering an integrated solution for people to listen, discover and purchase music anywhere, anytime,” said Williams. He added that people downloading music from the internet for free and then listening to it on their mobiles is not something he worries about.
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There are more and more people willing to pay for quality music, and also for the experience,” said Williams.
On the question of whether Nokia as a technology provider is also becoming a service provider, Williams claimed that the company’s focus is to offer consumers the best possible experiences, and to ensure the success of Nokia’s operator customers.
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In terms of music, the success of the whole industry depends on our ability to address consumer needs in a timely manner, which is something that drives both growth and demand,” said Williams.
Consumers have thus demonstrated their interest in digital music services, and Williams claimed that Nokia firmly believes the telecom industry should follow this trend and capitalize on the opportunity.
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This is a big and growing pie, with enough for everyone to share,” said Williams. “
For us, it means sales of more advanced devices; for operators it means increased data traffic; for the content industry it means more content sales and usage.”
Furthermore, Nokia is out to give people a choice about where they buy their music.
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Of course, we will support operators’ music stores, as well as third-party music services,” Williams commented.
Nokia’s top music phones are the N91 and 3250. These are specific models that enable listening to music, but the 5500 Sport and most of the other N-series models have music-playing capabilities.
Sony Ericsson, a company formed through a multimedia and mobile phone merger, will bring to market a number of new music-related models in the final quarter of 2006.
The W710 is a Walkman phone designed for people who enjoy working out and keeping fit. It has a built-in motion sensor for counting your steps and calculating how many calories you burn. The W850 is the first “slider” design phone from Sony Ericsson, with 1GB memory, bluetooth, 3G functionality and a 2-megapixel camera. The W950 is a combination “smartphone” and Walkman phone, with 4GB memory and a handwriting recognition function. Sony Ericsson does not offer music downloads.
One very interesting development is the emergence of a new legal service that looks set to offer music downloads for free. At the end of August, SpiralFrog signed an agreement with the Universal Music Group, the world’s largest record company, to make songs available for free from the latter’s formidable music catalogue.
SpiralFrog CEO Robin Kent said the music and video download service will be entirely ad-supported, and will not cost its users anything but their time.
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Offering young consumers an easy-to-use alternative to pirated music sites will be compelling,” Kent said. “SpiralFrog will offer those consumers a better experience and environment than they can get from any pirate site.”
SpiralFrog’s target audience, people between the ages of 13 and 34, is an advertiser’s dream, Kent added.
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This is the core audience we will attract by building a music-centric experience and destination that is second to none, legally delivering what the majority of users want. It’s content that advertisers are willing to pay for on their behalf.”
SpiralFrog will launch in beta later this year.
Source:
BBJ.humystro - 22. Sep, 00:39
