Saturday, November
4, 2000
Intermediaries Will Drive UK Download Music Market
New intermediaries -- repackagers -- will emerge to
drive downloadable music sales to £300 million in the
UK in 2005, according to a new Report by Forrester Research.
"Managing downloadable music efficiently requires a
combination of rights and content management skills --
found in few companies at present," said Rebecca Ulph,
analyst at Forrester's UK Research Centre. "Repackagers
will emerge to solve content owners' problems and provide
the impetus that the downloadable music market needs.
They will deal with security and content management concerns,
resulting in securely delivered products available in
flexible content bundles -- meeting the needs of both
content owners and retailers."
Digitisation causes the unbundling of traditional content
packages -- albums -- and the fragmentation of content
into individual units. Neither record companies nor retailers
are keen to take on the rebundling issues that fragmentation
introduces. Repackagers will deal with the individual
items of media, such as songs or lyrics, and put items
together in new combinations to create secure products
for sale or redistribution.
In the future, the ways consumers will be offered tracks
will change, Forrester asserts. By bringing together
content from multiple labels and artists, repackagers
will make it easier for retailers to offer flexible content
bundles of video, audio and text. Close relationships
with consumers will allow different prices to apply to
different buyers at different times. Downloadable delivery
will also encourage time-sensitive promotions, and payment
of a flat monthly rate for unlimited access to selected
music that will appeal to users with broad tastes and
a high rate of consumption.
"Customised content bundles comprising song lyrics,
album artwork and selected tracks will create a more
attractive buy than a track alone, especially if users
can create the bundles themselves," Ulph continued.
Taking music from existing labels, unsigned bands and
established artists, repackagers will make relevant content
bundles available to diverse, non-traditional retail
outlets making downloadable music a far more attractive
proposition for content owners, retailers and consumers
alike. Consumers will increasingly get downloads from
non-traditional, high-street outlets, accelerating downloaded
music's acceptance amongst non-traditional listeners
and non-PC owners -- expanding potential audiences.
"In five years' time, a maturing downloadable music
market will allow content owners to concentrate on what
they do best -- artist development and promotion -- whilst
retailers and repackagers will satisfy differing consumer
demands. Content owners will concentrate on artist development
and promotion, repackagers will emerge as hubs for downloadable
content and music retailers will expand their offerings.
By 2005, consumers will be hitting both the Web and the
high street for their music downloads," she added.
For the Report "Repackaging Downloadable Music" Forrester
spoke to executives from UK media companies, device manufacturers,
digital rights management providers and downloadable
music retailers. Forrester defines downloadable music
as: "Music downloaded to consumer devices, playable without
a network connection."
