Why Advertising Supported Free-Music Ain't Gonna Happen

Cayocosta

Lots of hype and bluster about ad supported free-music solutions lately. Well, it ain't gonna happen, and here's why:

Two ways to offer ad subsidized music: streaming and downloads.

The problem with downloads is that once the track is downloaded, the ad is no longer attached; unless the ad is audio and embedded in the tune - which would kill the idea.

Which brings us to DRM. DRM protected tracks with proprietary players would allow ads to be served while tracks are played. But again, limiting the use of tracks to certain players would kill the concept.

Streaming on dedicated players that serve ads is not a bad idea, but limited in application as a live internet connection is required to stream in real time. Thus, ad-supported streaming is DOA.

Remember, the industry is competing with free, unfettered mp3 downloading and listening (albeit illegally).

Beyond all this is the amount paid to the content providers.

For downloads, Amazon and Apple are charging .80 to .99 per track and netting back 70 cents or so to the labels. There is no way ads can generate anywhere near as much.

Now, why would the industry accept mere cents on the dollar when they are already receiving 70 cents per track for paid downloads?

Why then would the industry voluntarily kill the remaining CD business and developing paid download business - for a fraction of the music's market value?

Then there's the precedent. Should the industry allow music to be free - subsidized via anything else - it would be nearly impossible to return (if so desired) to charging for downloads.

Hence, for free-music subsidized via advertising to work, the industry would:

1.) have to accept much less than the market value of music.
2.) hasten the decline of its remaining CD business.
3.) render obsolete its burgeoning paid download business.
4.) have to accept sharing fractional revenue with third parties (portals).
5.) once and for all, establish that recorded music no longer has any intrinsic value in the marketplace.

Humbug.

In the interim however, should a tech player offer millions of dollars for the rights to stream (no downloads) content under an ad supported platform (imeem, for example), the labels will rightly take the money and run.