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Resnikoff's Parting Shot: Why iLike & Rhapsody Don't Mix

Tuesday, July 22, 2008
by  presnikoff

If you've been trolling on iLike within Facebook recently, you've probably noticed some Rhapsody-powered audio streams.  The companies first disclosed integration plans last month, and now, the implementation into Facebook is happening.

The deal was an easy decision for Rhapsody joint venture partners MTV Networks and RealNetworks, who now find themselves planted into one of the hottest online music properties.  That means exposure in front of a targeted music audience, one that is theoretically most open to premium music offerings.

iLike, Rhapsody Stream

On the flipside, iLike also benefits from the deal.  That includes the ability to compensate artists on streaming previews - and outsource the royalty infrastructure to Rhapsody.

But is this really that interesting to iLike users?  Sure, sampling full-length tracks is great, but Rhapsody reverts to 30-second clips after 25 monthly plays.  If you want unlimited full-length tracks, you must get a separate Rhapsody subscription.

And that is where the discussion will end for most users.  After all, iLike also links heavily into YouTube videos, and LimeWire can take care of the rest.  And YouTube videos, despite their hit-and-miss quality, represent a strong discovery and networking vehicle within the iLike architecture.

But pay for full-track streaming audio access? That is an experiment that has been suffering for years, in a variety of production iterations, and an iLike integration is unlikely to change things.  The modern-day music fan is simply too accustomed to free access, thanks to a digital environment that features little to no scarcity.

The end result?  iLike will probably see little lift in stickiness, though the deal certainly doesn't subtract from the existing experience.   But don't expect users to start prying their wallets for this one.

iLike, YouTube (Rawls)

An alternative approach for iLike would feature free streams, perhaps supported by ads.  But why is it so difficult to effectively license full-length songs?  Over at last.fm, full-length tracks are now embedded within the service, though the overall selection is disappointing.  And a recent licensing fallout between Warner Music Group and last.fm did little to help the matter.

And that is a story that keeps repeating itself.  Instead of predictable recording rate structures, companies interested in licensing on-demand content are saddled with massive upfront costs, and a variety of onerous demands.  Major labels routinely impose that structure on startups and established companies alike, though a shrunken recording industry may eventually produce easier licensing terms and structures.  And that could translate into greater freedom for startups, and more interesting experiences for music fans.



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