Next-generation record label
Combines B2C and B2B
B2C: downloads and CDs
B2B: music licensing for commercial use
Magnatune is...
Selected music
Full Preview
Fair price
High quality product
Main Consumer Benefits
Selected Music
Consistent quality
Hard-to-find genres
Manageable size
Preview
Listen to everything for free
Never-ending genre mixes
High audio quality
MP3 streams
Fair Price
Pay what you want
50% for the musician
No registration
Quality Product
MP3 and CD quality downloads
Allows later re-download
No DRM
Limited musical diversity, poor quality
CD prices too high
Ripped-off musicians speaking out
DRM
Symptom: using P2P is acting as a just-cause revolutionary
Leveraging consumer anger at the Music Industry
How music demand is typically created
Traditional command-and-control marketing
Grass-roots uprising
"Customers also bought"
Try-before-you-buy (Magnatune’s focus)
Radio
MTV
Concerts
Mix tapes from friends
Try-before-you-buy: the old ways
30-second snippets (iTunes/Amazon)
"Concept" compilations ("Buddha Bar")
Recommendation web sites
P2P used for previewing
Mix CDs from friends
Social MP3 sharing
DJ culture & raves
Internet radio
Try-before-you-buy: many new ways
Most music heard is not at home, but in a business/commercial setting
Consumer shopping experience is increasingly staged, with music in a key role
Music is branding
TV commercials make hits
Tie-ins are increasing
Music biz becoming like book publishing
Music Biz isn't just CDs
end.