Rhapsody gives a free month to CD buyers

Tuesday, October 22, 2013 - 9:15am

It makes sense. Put the new model where the old model lives. Try to bring in a new audience that might not have sampled competing services yet.

That’s what Rhapsody’s just-announced partnership with Best Buy is attempting. Anyone buying a (qualified) CD from Best Buy’s racks will be gifted with a month of Rhapsody’s subscription-only online listening/collecting platform. It’s a nice surprise for the buyer, and a bit of incentive that Best Buy can promote on its CD shelves. Rhapsody’s play is to drive a wedge into the CD consumers’ buying habits, introduce them to an access model that might be entirely new to them, and convert ‘em. In that context, Rhapsody and Best Buy are at cross-purposes.

Rhapsody competes most directly with the laboriously-named Google Play Music All Access, which likewise provides subscription-only service, with a cloud-storage component Rhapsody lacks. Among indies, Rhapsody is most often compared to Spotify and Rdio, both of which, in addition to offering premium subscriptions to avoid ads and enable downloads, provide a layer of free listening.

In recent months Rhapsody has suffered a management shake-up and sweeping staff layoff. Last week Rhapsody announced an international telecom partnership with Telefonica, for international distribution of its service in Europe and Latin America. (RAIN coverage here.)

NPD Group: Far from hurting music sales, online radio cited as reason for growth

Tuesday, March 6, 2012 - 11:55am

Music sales increasingAfter years of decline, more consumers are buying music, in part thanks to online music services. So says the NPD Group in its "Annual Music Study."

The NPD Group found that in 2011, for the second consective year, the total number of music buyers increased (up 2% to 78 million). Plus, total music-track sales rose 4% thanks to "a healthy paid-music download market."

Consumers surveyed by the NPD Group pointed to the wide variety of music services now available -- from AM/FM to Pandora and Spotify -- as a driving factor behind increased music spending. Mobile devices, a decline in P2P downloads and the perception of improved quality also were cited as reasons for growth. 

The report makes the (oft-made) point that the profileration of online radio and web music services hasn't replaced the need to buy and own music. In fact, as stated, it may help drive more music sales.

The NPD Group"Despite all of the exciting online radio options, we are still seeing healthy growth in the market for digital-music downloads," said Russ Crupnick, a SVP at NPD. "As long as consumers want to own digital tracks and continue to have a passion for the physical format and a way to play their CDs, online radio and paid-to-own music will live in harmony." 

All Things Digital's Peter Kafka comments (here) that it's "a little counterintuitive" that music purchases would increase in the face of growing free streaming options.

"But that’s always been part of the streaming music service pitch to the big labels... We’re starting to hear murmurs from the labels that this is actually how it’s working in the real world, too."

You can find The NPD Group's press release here.

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