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Label-owned music downloading services will never work

Sony BMG may be starting a music downloading service to compete with Amazon and iTunes. Don Reisinger thinks it's a total crock that'll never get off the ground.

In a surprising announcement out of Sony BMG today, the company's chief said his company is exploring the possibility of developing its own music downloading service. And while he may believe that it makes sense, I think it's one of the dumbest things I've heard from one of the record labels in a long while.

According to Rolf Schmidt-Holtz, Sony's online subscription service would allow customers to download an unlimited number of Sony BMG tunes for about $9 to $12 per month. All downloads would also be compatible with every major player on the market, including Apple's iPod.

Although this may sound nice on paper -- after all, Sony BMG is a major record label with major songs -- it makes no sense. Sure, Schmidt-Holtz went on to say that Sony BMG is in discussions with other major music distributors, but if you take a logical look at what's really going on here, the other labels will never jump on the bandwagon and Sony BMG's service will die before it even gets started.

And here's why:

First and foremost, record labels have no business creating music downloading services. Let's face it -- ever since music downloading became a popular commercial enterprise, it wasn't Apple that tried to stop us from doing what we wanted, how we wanted with our music, it was the record labels.

Knowing this, how exactly would this service work? Would there be DRM? Sony BMG didn't comment on that, but considering the fact that songs can be played on most major players, I would think not. Then again, the labels are still major DRM proponents, so you never really know what they come up with.

If there's no DRM, at least the service would have a leg up on iTunes. But why would anyone even use it if you can only download the handful of worthy songs on the Sony BMG label? Does it make any sense to pay $10 per month for a service that you'll probably only use once per month and download a handful of songs at a time? I doubt it.

Now I know what you're thinking -- "Sony BMG said it would try to form partnerships with other music distributors, so it wouldn't just be a Sony service!" Please. Anyone who believes that the rest of the major labels will jump on board and allow one of their major rivals the opportunity to make some cash on their songs should reevaluate their opinion.

Why would any other label sign on to this service? The labels already offer DRM-free tunes on Amazon and make a ton of money on iTunes. What sense would it make to sell songs on Sony BMG's service and standby as a major competitor enjoyed revenue at their expense?

Most importantly, I just don't see how the recording industry could somehow become a major player in the music downloading business. It's not because there isn't enough cash -- they can thank the artists for that -- and the recording industry's inability to make a dent in the downloading business probably has nothing to do with integration. More than anything else, I simply don't see how or why consumers would gladly use Sony BMG's service.

The RIAA is easily one of the most hated organizations in the world. On top of that, it represents the record labels that are trying to do all they can to get in on the music downloading action. Why would someone use the service of a group of companies they simply can't stand if they can get the same music elsewhere on an a la carte basis? It just doesn't make sense.

If Sony BMG's service ever gets off the ground, I'll be surprised if it has anymore than one record label on its side. The only way for a real major label service to develop is if all parties hold the same vested interest in seeing it do well. And the way it looks, that simply won't be happening with Sony BMG's idea.

Record labels have no business offering music downloading services and the way I see it, they'll never work. And let's thank goodness for that.