Several fresh faces emerged onto the digital-music scene this year, buoyed in part by record companies' newfound willingness to experiment with different business models, but also by the departure of several high-profile competitors.
By far, the most visible
Sony began the slow dimming of the switch on the
Zune, though, is hanging in there. This year, the Microsoft service was upgraded with a decidedly social networking-oriented strategy. The
Meanwhile, a host of such companies as
And the year ended with
But neither the stumbles of MTV and Sony, nor the experimental methods of Radiohead and others, have kept the following services from entering the market with their own business models.
After years of "will they or won't they" teasing, --which, as promised, features iPod-friendly, digital rights management (DRM)-free MP3s from EMI Music, Universal Music Group, and a handful of independent labels.
In addition to unprotected music, it promotes a variable pricing model that sells albums for between $5 and $9. In the short time it's been active, the service is already considered the third-largest digital-retail outlet on the Web, after iTunes and eMusic--and that's without content from Sony BMG and Warner Music Group.
The poster child for the much-discussed "ad supported" business model, after a lengthy delay that saw its the company and millions of dollars in music-licensing fees wasted while the .
Belying its name, , with two service launches. The first, in the spring, marked the start of its .
It then followed up in November with phase 2: transferring that service to a portable device that uses Wi-Fi to update channels, and a subscription service tier that offers users more functionality for a monthly fee. Now that all the pieces are in place, look for Slacker to pick up the slack during the holidays and into next year.
The digital-music business model these days is much like a game of chicken. Start with a service that lets users stream free music, then hope to gain as many users as possible, so that when the labels threaten to sue, you can turn it around into a licensing deal instead.