Yahoo
acquired digital music website operator Launch Media for
$12M in cash on June 2001. The company has been renamed
Yahoo Music, however the radio division still keeps the
Launchcast
identity. Yahoo wants to showcase all its music products
and services under a single brand, the company said. The
service already has begun operating with a new logo. Yahoo
Music offers streaming audio, music
videos, Internet radio and news covering various genres
of music.
The
company recently formed Yahoo Media Group, putting together
several Yahoo properties, including games, news, sports,
finance, movies, and music services Yahoo
Launch and Musicmatch. Yahoos
Launchcast radio services was the highest-rated Webcasting
service online in January 2005, according to ratings firm
Arbitron and ComScore Media Metrix, attracting more than
2.2 million people that month. However, Apple's dominance
has been challenged by other giants, ranging from Sony
to Microsoft, without substantially decreasing the iPod
maker's market share, even though iTunes has sold over
400 million legal downloads by (March 2005) since its
launch.
Yahoo
has invested heavily on music services, and considers
audio and video cornerstones of the company's future.
In addition to buying song outlet MusicMatch for $160
million, Yahoo is working on another music service in
conjunction with rival MusicNet. The company has also
started to streamline its music and multimedia properties,
changing the name of its Launch site to Yahoo Music and
consolidating its entertainment businesses in a Santa
Monica, Calif., office near Hollywood.
Search
technology is considered the key to navigating the Internet's
growing music and video collections, as well as the Web
itself. Yahoo not only is developing media and online
communities to lure visitors, it is attempting to use
its media-search engines to connect with Web surfers outside
the Yahoo network. That way, Yahoo can build its audience
and likely expand its multibillion-dollar search-advertising
business.
Jupiter
reasearch analysts agree that Yahoo's strategy makes sense
because the company has a wide access of music and what
is missing form the equation is search, in particular
in regards to the structured data of music such as title,
genre. The company also is investing in video search pushing
its video search engine, Yahoo Video Search in partnerships
with several TV programmers, including Bloomberg, MTV
and the Discovery Channel, to make their content searchable
online. An estimated 24.5 million people visited Yahoo
Music in March, according to market researcher ComScore
Networks.
Yahoo's
entry into the digital-music search market could turn
the heat up on rivals, including music stores such as
Apple Computer's iTunes. Google even registered the Web
address Googlemusic.com more than two years ago, although
the search behemoth has yet focus its technology on music.
But Yahoo's music search will directly compete with services
such as Singingfish, GoFish and MP3.com, which is owned
by News.com publisher CNET Networks. Such services let
people find music reviews and related information, along
with links to legal download stores and peer-to-peer networks.
The digital music business is expected to grow quickly,
with sales rising from just 1 percent of the US$12 billion
global music market in 2003 to an anticipated 12 percent
by 2009, according to Jupiter Research.
Yahoo
released Yahoo Music Unlimited, which charges just $60
a year for unlimited access to over 1,000,000 songs from
all four major record labels and many independents, plus
transfer those songs to portable players. By comparison,
most music stores charge 99 cents for a single song, and
most subscription services charge $15 a month, which can
add up to $180 a year. Yahoo is charging exactly a third
of what Napster To Go charges for portability, and exactly
half of Napster's non-portable music service. If you pay
for the whole year up front, it comes out to a measly
$5 a month, and it doesn't charge extra for portability
like others, despite using the exact same technology Napster
and RealNetworks use, Microsoft's Janus technology.
Yahoo
will also be leveraging the power of its other services.
Yahoo Instant Messenger users will be able to browse playslists
and listen to songs on other YIM user's computers, so
long as both users as subscribers. Yahoo's current music
services, including Launchcast, attract 25 million users
a month, a considerably large userbase it can attract.
Subscribers to Yahoo Music Unlimited get free Launchcast
Plus. This is a huge selling point for fans of the service,
as I know from using and loving Launchcast. Since Launchcast
Plus is $35 a year, using Yahoo Music Unlimited adds just
$25 a year, a price so absurdly low that most Launcast
Plus users might subscribe just for the hell of it. Others,
like myself, who have held off on Launchcast Plus subscriptions,
might see this as the killer deal that gets them to sign
up.
Yahoo's
pricing has so undercut the entire market it is being
reported as "immediately mak[ing] it a serious player".
While the pricing is so dramatic as to overshadow any
other news about the service, it will still be interesting
to see the reaction to the full product. What will people
think of the new Yahoo Music Engine, which powers the
whole service? Since Janus-compatible players have not
penetrated the market much, it will take time for Yahoo,
even if successful, to start making serious dents in iTunes'
bottom line. When consumers start relizing that legal
music costs so much more money on an iPod, we may see
sales of Janus players skyrocket, no matter how much better
Apple's iPod players are.
Additional
Yahoo Resources:
Launchcast
is an online radio station that plays music based on the
voting of the user. With a Yahoo! account, users can gain
access to thousands of songs sorted by both artist and
genre. You can visit the official site at music.yahoo.com,
launch.music.com, launch.com, launchcast.com.
Yahoo Launch Cast
is a streaming music service allowing you to create your
own customized station tailored to your tastes. Rate artists
and albums highly to hear them often and ban the ones
you hate. You can also listen to our extensive collection
of pre-made stations created by Yahoos editorial staff.
Launch Cast gives you the ability to customize a radio
station based on your tastes. This guide will help you
get the best experience on your customized station. In
a nutshell, you tell Launchcast the music you like and
don't like, and the Yahoo Music
system will produce a radio experience that includes music
you like as well as new music you might like based on
your tastes.
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