On 9/12/2008 the UK outlet for tech guru cnet.com published a review by Nate Lanxon of the new online digital music retailer, Passionato.com. The article lavishes praise on what amounts to a an online retail site that, compared to iTunes, simply provides more information about classical music recordings and an additional download format beyond standard MP3 (but only for selected recordings). Unfortunately, the review completely misses the bigger (and far more important) issues discussed here from a few weeks ago on the topic of why digital music retailers are conspiring to herd the cows that are listeners into the same old pen: buy it or nothing. However, instead of merely composing another rant post, I contacted Passionato.com for some more info.
In particular, I wrote to Passionato.com asking if they had any plans to allow on-demand streaming via monthly access fees or if purchasing tracks for download will continue to be the only option customers will have to enjoy music. Rob Gotlieb, Passionato’s Director of Marketing & Business Development, Europe, responded via email the next day with the following answer:
“Our research told us that classical music lovers are usually collectors – they take great pride in their music libraries. These collectors don’t like the subscription model, in which music is basically ‘rented’ as opposed to being actually ‘owned’. What’s more, most subscription services are always required by the major record labels to have strict DRM (digital rights management) controls which prevent music from being liberally transferred to other devices or burned to CD…We believe that based on where the industry is in terms of interoperability, it’s the best deal for the customer – and that’s at the heart of everything we do. Whilst a subscription model may be effective for sites offering a broader range of genres, it wouldn’t provide any benefits for classical music aficionados.”
First, I sincerely appreciate Rob’s answers; however, if this accurately represents the organization’s approach to digital music distribution then I don’t expect them to fare well in the long run. The DRM issue is something that is slowly fading into the distance as consumers demand less restrictions. Granted, there will be plenty of bumps along the way, but DRM free music is a likely to come about sooner than later. As a result, online distributors who are pushing labels toward usage rights that allow streaming are going to be in a much stronger position than their competition in a few years.
Next, it is good to see that Passionato conducted some market research but to form a business model around an existing consumer market for a start up in a field experiencing rapid decline in revenues isn’t exactly something that might inspire confidence. Furthermore, larger distributors (like iTunes) can always swoop in and steal your client base and catalog away if you make any real money with the model. Nevertheless, the real issue here is if the business plan is built around an existing audience of aficionados, then how does the company plan on actually building an audience.
Lastly, to refer to an on-demand streaming subscription model as being something that is more effective for other genres practically drips of elitism and look how well that has worked out for the classical music business. Classical music consumers should demand more options and better treatment from online distributors. Make noise, complain, and be heard. Ultimately, the power is in the hands of the consumer so stay after online distributors until they realize you aren’t satisfied with one measly side dish of mashed potatoes.
Follow-up questions inquiring about these issues and requesting additional details about the organization’s market research have been sent to Passionato and I’m looking forward to posting their response when and if it arrives. In the meantime, let’s conduct some home-grown market research with the following poll:
Postscript: Not to challenge a review from a fine group like cnet, but my experience with the Passionato.com website was far from stellar. For a company that aims to “become the world’s most comprehensive online classical resource and offer classical music lovers the largest available collection of
high-quality DRM-free classical music downloads” there is not much going on. For example, a search for “chicago symphony” returned zero entries. The same was true for a “baltimore symphony” search and if you’re looking for anything with “yo-yo ma,” you’re out of luck.
Consequently, searches for “new york philharmonic” and “berlin philharmonic” returned one entry each so I suppose that will have to be enough to satisfy aficionados. Furthermore, even though I added two CDs to my online shopping cart to find out what the check-out experience is like, their system continually told me my cart was empty (although it did manage to find a way to include my anticipated purchase charge). The phrase “caveat emptor” comes to mind…