Despite inroads from labels, carriers, and online music retailers, mobile music downloads haven’t taken off yet in the U.S. This was underscored yesterday by two companies: Napster, whose CEO Chris Gorog lamented about the limited number of mobile phones compatible with his over-the-air download service, and Warner Music Group, which reported that mobile sales have been “soft.”
WMG, NAPS, and everyone else in the music business has been waiting for an explosion in mobile to help replace the rapidly disappearing CD. But the ringtone fad is slowing, and there hasn’t been much to fill that void, particularly in the U.S. According to research firm M:Metrics, less than 6% of American mobile subscribers listen to music on their mobile phones, and only 1% download music from over-the-air stores.
So heres a glimmer of hope: DRM-free MP3 sales. Whether or not people really want to buy music on their phones, most of them simply haven’t had the chance, because few phones are set up to play the files. But just about every phone should be able to handle unencrypted MP3s. In his earnings call yesterday, Gorog said Napster’s forthcoming switch to MP3 will allow Napster to work with “many multiple” more phone models, in the “millions of units”.
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