OVER MOBILE NETWORKS
Abstract
The transition from physical to digital music distribution is bound to have profound implications on the music industry. So far, most of the activity related to digital music distribution has been centred on the fixed Internet. In the meantime, mobile operators have been making significant investments in extending their network capabilities to support data services. This paper includes an analysis of the current situation of music delivery in mobile networks, as well as future prospects enabled by the technical evolution of mobile networks. The overall feasibility, and the potentially most viable forms of, mobile music business are studied.
Key Words
Music industry, mobile communications, digital distribution, e-commerce, information economics.
1. Introduction
Until recently, ownership of recorded music has been always tied to a physical medium. The introduction of new encoding techniques, most notably the MP3 format, together with other technological developments towards the turn of the millennium have detached music from any physical medium. One of the most fundamental implications of this technological development is that it enables digital distribution of music. This has profound implications on the music industry, which heavily relies on physical distribution models. Initially disdained by the incumbent industry players, this new distribution channel has until recently only been successful as a channel for pirated content, enabled by a wave of peer-to-peer distribution technologies, effectively draining revenues from the incumbent players.
A second wave of digital music distribution soon followed, with the intent of diverting users from pirated content from peer-to-peer networks, while still offering the benefits enabled by digital music distribution. So far we have witnessed the success of at least one of the commercial services that is based on digital music
References: Brown, B.; Geelhoed, E.; and Sellen, A (2001) “The use of Conventional and New Music Media: Implications for Future Technologies” in Proceedings of Interact’2001, Tokyo, Japan, 2001. Christensen, Clayton (2001) “Innovation in the Telecommunications Industry: Separating Hype from Reality” Telecommunications Working Paper, October 2001. Ericsson (2003) “Ericsson and Sony Music new Wireless Service, M-USE” Press Seminar, 2003. http://www.ericsson.com/de/presse/background/SonyMusic_m-use.pdf (Online, referred 03.04.2004). Millenium Group (2001) “The Music Industry and the Internet” Case Study. Radio Advertising Bureau (2002) “Radio Days 3”. Talonen, T (2003) “Disruptive Technologies and the Music Industry: Incumbents vs. New Entrants” Master’s Thesis, Helsinki University of Technology. Hampe, J. Felix and Schwabe, Gerhard (2001) “Enhancing Mobile Commerce: Instant Music Purchasing Over the Air”, University of Koblenz, 2001. International Federation for the Phonographic Industry, IFPI (2002) “ The Record Industry in Numbers”. Nokia (2004) Visual Radio http://www.visualradio.com/ (Online, referred 03.04.2004) Shapiro, Carl and Varian, Hal R Zhang, Michael X. (2002) “A Review of the Economic Properties of Music Distribution” draft, MIT Sloan School of Management, Boston USA, November 2002.