Apple's current mobile iTunes partner, Cingular Wireless, is going to raise the bar on their music offerings:
Cingular Wireless is expected to team up with online music services, including Napster Inc., Yahoo (YHOO.O: Quote, Profile, Research) Inc.'s Yahoo Music and eMusic, to launch a music service on its cellphone network, the Wall Street Journal reported on Wednesday.
The move by Cingular, jointly owned by AT&T (T.N: Quote, Profile, Research) and BellSouth (BLS.N: Quote, Profile, Research), may set the stage for a battle with Apple Computer's (AAPL.O: Quote, Profile, Research) Ipod. The service would work on cellphones that double as music players.
According to the Journal story Reuters cites, the most interesting thing Cingular's new service will allow for is synchronization with Napster's and Yahoo!'s Windows Media-based subscription services where, for a monthy fee, customers have access to the entire catalog of music these services offer. This would be in addition to playback of individual song downloads from Napster, Yahoo!, and eMusic, and tracks ripped from a customer's audio CDs. The Journal also says that An Over The Air (OTA) music download service from Cingular (like the ones offered by other carriers like Verizon and Sprint) is purported to be in the works for next year. I suppose the goal would be to allow Cingular customers to buy tracks from Napster, Yahoo!, and eMusic while mobile.
This reads, for now, like not much more than an extra bit of distribution for Napster and Yahoo! Music; they're adding a few devices that Cingular resells to their list of supported players. That alone is not a huge win for the subscription services. Their larger problem is convincing people of the value of the model, especially when it precludes using an iPod as your player. Part of the problem with that messaging is the platform, Windows Media, and PlaysForSure, which has acquired a reputation for not being quite such a sure thing. Between momentum and bad press, the Apple triad of iPod, iTunes, and iTunes Store has rolled over the Windows Media and PlaysForSure ecosystem to such an extent that even Microsoft's abandoned it with Zune.
Leaving that aside, does this point to a carrier- and phone-maker threat to Apple's dominance of digital music? After all, Sprint has sold 8 million tracks in the last 12 months, and Nokia plans to put 80 million music-capable phones in customers' hands in the next year.
The mainstream of the portable (if not connected portable, or mobile) music business is Apple. Whether this changes depends on your answer to a few questions:
- Does the world demand a converged device?
- What's the baseline user experience when buying, managing, and listening to music on the go?
- Where should this experience fit into the overall entertainment experience at home?
I see Apple as being able to bide their time as they address the first question (iPhone, anyone?), since they have a clear winning answer to the second issue, and an evolving strategy for the third, which we'll understand better as Apple brings their iTV product to market. In this last area, incidentally, none of the mobile players are credible—the real threats are Cisco, Microsoft, and Sony).
Does this rule out Cingular as Apple's exclusive partner for the upcoming iPhone everyone's expecting? Engadget doesn't seem to think so (or, at least they ain't sayin' yet).
Update: I blew the relative introduction dates for the iPod, iTunes for Windows, and the iTunes Store. The original post implied that Apple managed to shift 1MM tracks in five days without benefit of the iPod adding to the demand, which would be amazing and totally wrong. Apple managed their amazing numbers without benefit of iTunes for Windows. That means they were selling exclusively to Mac users. Mea culpa.