Posted by: Heather Green on May 25, 2005
Om Malik has a thoughtful post on how the model at Yahoo’s new music subscription service could evolve. Debate is raging around how long Yahoo will be able to offer the ultra-cheap $7 monthly pricing, which undercuts music subscription rivals’ rate of $15. Peter Burrows wrote recently for BW about what a tough model that is.
Malik’s conclusion is Yahoo will turn to adveritising to make Yahoo’s music subscription a success.
We thought that too, but according to Dave Goldberg, vice-president and general manager of Yahoo! Music: “We’re not doing this to sell ads,” he says. Yahoo, he says, already has an ad-supported model in its Internet radio and music video offerings. “For users who want more control and greater access, subscription is the right model for them.”
So, we’ll just have to wait and see how they make the model work on subscription fees alone. Afterall, Yahoo says this is an introductory offer. We’ll just have to see how long the welcome mat will be out.