Next-generation record label

Combines B2C and B2B

B2C: downloads and CDs

B2B: music licensing for commercial use

Magnatune is...

Selected music

Full Preview

Fair price

High quality product

Main Consumer Benefits

Selected Music

Consistent quality

Hard-to-find genres

Manageable size

Preview

Listen to everything for free

Never-ending genre mixes

High audio quality

MP3 streams

Fair Price

Pay what you want

50% for the musician

No registration

Quality Product

MP3 and CD quality downloads

Allows later re-download

No DRM

Limited musical diversity, poor quality

CD prices too high

Ripped-off musicians speaking out

DRM

Symptom: using P2P is acting as a just-cause revolutionary

Leveraging consumer anger at the Music Industry

How music demand is typically created

Traditional command-and-control marketing

Grass-roots uprising

"Customers also bought"

Try-before-you-buy (Magnatune’s focus)

Radio

MTV

Concerts

Mix tapes from friends

Try-before-you-buy: the old ways

30-second snippets (iTunes/Amazon)

"Concept" compilations ("Buddha Bar")

Recommendation web sites

P2P used for previewing

Mix CDs from friends

Social MP3 sharing

DJ culture & raves

Internet radio

Try-before-you-buy: many new ways

Most music heard is not at home, but in a business/commercial setting

Consumer shopping experience is increasingly staged, with music in a key role

Music is branding

TV commercials make hits

Tie-ins are increasing

Music biz becoming like book publishing

Music Biz isn't just CDs

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