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Reviewed by Greg Beets, March 15, 2002, Music

Subscription Services' Hurdles to Leap

Austin Convention Center, Friday 15 How can paid online music services with limited catalogs and capabilities compete when virtually everything ever recorded can be found somewhere on the Internet for free? This is what major-label-backed subscription services such as Pressplay and Real One Music are up against. Not surprisingly, these services are ultimately hedging their bets on file-sharing services such as Morpheus being constrained (if not shut down altogether) through the legal system. Assuming this happens, there are still plenty of what-ifs related to just how legal downloading would operate. Pressplay currently offers a $19.95 monthly package that gives you 15 burns, 75 downloads, and 700 streams, while Real One offers 100 downloads and 100 streams for $9.95 a month, with plans to offer burning in the future. "The economic model of where this lands could end up anywhere," said Pressplay's Alex Luke. "I hope this doesn't happen, but you could wind up with an advertising model where you download a song and get a 10-second commercial for Doritos attached." Real One Music's Erik Flannigan admits that his service probably won't appeal to "the hardcore Morpheus user who's added a second hard drive," so marketing focus for subscription-based services is on more casual music buyers. "People under the age of 25 aren't into paying for this stuff," said Luke, "so we're looking at ages 25-34." Ultimately, the paid online music sources that survive will offer a wide variety of quality content in an easy-to-use format at a fair price, but it's still a mystery as to how the industry will get to that point. As Luke put it, "The climate of this business changes every two weeks."

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