Trade Review: Week Three (2/2)

"Nokia Music Streaming Services Launches in America"

http://www.rollingstone.com/culture/blogs/gear-up/nokia-music-streaming-service-launches-in-america-20120911

In another effort for a company to get involved with the music streaming service industry, Nokia is the latest tech giant to take a chance on cross promotion of their products with the music industry. With a music streaming service similar to Spotify but with many twists to its business model, Nokia hopes that their music streaming endeavor, Nokia Music, will jump overall revenue for the company. Nokia Music is incredibly unique in its infrastructural design and offerings for its customers. Foremost, since Nokia phone holders already have access to the Nokia Music platform it allows customers to not "give over credit card information, [fork] over an email address or [endure] time and bandwidth-sucking ads" (Grow). The notion of Nokia Music already being an additional service to a Nokia phone incentivizes customers to purchase a Nokia phone knowing that they can listen to the same music in the same music streaming fashion through less hassle and time, where Nokia really wants to get "all of the clutter out of the way between the user and music" (Grow). 

Additionally, Nokia Music will not have any ads, there will be no subscriptions needed and no additionally payments. Definitely the most incredible part to this new business model is that Nokia is footing the licensing bill for all the content provided on Nokia Music; therefore, customers do not have to pay an extra cent to use the application that is even preinstalled on the phone so you do not have to even download it. A major move for Nokia and music streaming alike, Nokia's goals to bring Nokia Music was not easy (Nokia is based in Finland). To further prove how far Nokia has gone to make Nokia Music a game changer for the music industry, Nokia even has customized the music available based on your country of location. So, Nokia had various programmers to make sure that each country's musical preferences were adjusted accordingly in order to make the content available enjoyable. 

Nokia music becomes even more personal by allowing you to select three songs and Nokia Music will make a playlist just based on the artist, style, tempo, and genre of music. Other playlists are provided on Nokia Music that cover a wide range of musical genres, including celebrity playlist that Rhianna, Green Day, and Lady Gaga have created for the program. Also, Nokia allows you the option to skip over six songs every hour, which is then tracked to ensure that your taste in music is personalized, adjusted, and will play the music you enjoy - something similar to Pandora. The notion of creating your own personal radio without having to select the music yourself is the newfound phenomenon for music streaming. 

Although Nokia Music is by far one of the most detailed music streaming services to come out to date, the few flaws in the system inhibit a large portion of potential revenue. Despite it being a perk, the notion of Nokia already having the application and music licensing prepaid really cuts into the potentially profits for Nokia Music. As well as, the music offered is limited to how many songs they were allowed to license for the service, how many songs they choose to offer, and how much Nokia Music can afford to support thus far. Nokia Music also has the downside of users not being able to pick their own music and solely relying on a program to select the music they like based on scanning your music library or choosing three songs for a playlist. 

After just launching this September it will be interesting to see if Nokia sales will go up due to this new service, or if consumers are truly faithful to their precious iPhones, Droids and Blackberries since Nokia has never been a popular United States smart phone. For me, I am most interested in seeing how the mere idea of footing the licensing bill, no ads, and the deep personalization factor in Nokia Music could pave the way for larger media, tech, and music giants to offer services similar to Nokia Music's. 

1. Grow, Kory. "Nokia Music Streaming Service Launches in America." Rollingstone.com. N.p., 11 Sept. 2012. Web. 16 Sept. 2012. <http://www.rollingstone.com/culture/blogs/gear-up/nokia-music-streaming-service-launches-in-america-20120911>. 

Trade Review: Week Three (1/2)

"Spotify's Value Up To Tune of $4.0 Billion by Claire Atkinson"

http://www.nypost.com/p/news/business/spotify_value_up_to_tune_of_tgJNPr9R5y1rCUaXHAnYbJ

On the verge of finishing a $400 million dollar fund raising round, Spotify's market cap is nearing the four billion mark - almost double in value from last year's $2.2 billion. Recent interests from private investors to major firms like Goldman Sachs are drawing major attention to Spotify's potential to be one of the most integral, newborn businesses for the music industry. A business model based on streaming music for free, Spotify's innovative solution for music piracy and for today's generation to have unlimited access to unlimited content is changing the way we legally acquire musical content. 

With over 15 million users, Spotify creates revenue through a social media partnership with Facebook, advertising, and subscriptions. Every Spotify account must log in through Facebook, which in turns posts the user's listened to content to the social world and also advertises Spotify on Facebook. CEO and social media giant Mark Zuckerberg praised Spotify for being "a company that was making best use of the social network’s platform" (Atkinson). Additionally, advertisements on Spotify's website is a traditional form of creating revenue for any website company. However, Spotify is utilizing a new advertising approach by creating a subscription opportunity for its users to not have any advertisements during their Spotify experience in exchange for about five dollars a month. A different subscription Spotify also offers is for ten dollars a month, where users will not have any ads, offline use, and also HD sound quality for their music. The most innovative part of this deal is that you do not need to have Internet to stream the music, which allows unlimited downloads for ten dollars a month essentially. With already four million subscribers, fifteen million users in total, and already making 887 million dollars in revenue last year, what does Spotify need investors for?

With these new funds, Spotify hopes to enhance their user experience by creating a browser-based service what will change the way users will interact with Spotify and its available content. The browser service has people questioning "whether the new browser-based version will replace the traditional desktop client" (Karin). Although a new way for users to interact with Spotify and find music, some are skeptical as to how this will change the way Spotify functions because it could potentially get rid of the desktop clients and how people are used to Spotify's interface.

Also, the $400 million raised will go towards expanding Spotify geographically to tap into new markets. Already an established name in the music and social media industry, Spotify's expansion into new countries will certainly create immense cash flow. With Spotify available in only sixteen countries, imagine the revenue the company would produce once it has the funds to tap into user-ready markets. Countries like Japan will be a massive breakthrough for Spotify as it is the second largest music market in the world. Spotify continues to prove itself as an up and coming music giant and worries current music giants like Apple, with what started out as a small spot in the music industry is now growing to a big problem for music servicing companies alike. 

1.    Atkinson, Claire. "Spotify Value up to Tune of $4B." New York Post. N.p., 13 Sept. 2012. Web. 16 Sept. 2012. <http://www.nypost.com/p/news/business/spot ify_value_up_to_tune_of_ tgJNPr9R5y1rCUaXHAnYbJ>.

2.     Kinder, Lucy. "Spotify Will Launch Browser-based Version." The Telegraph. N.p., 10 Sept. 2012. Web. 16 Sept. 2012. <http://www.telegraph.co.uk/technology/new s/9532943/Spotify-will-launch-browser-based-version.html>.