Online music service offers songs for 10 cents each
Of course there's a catch: You can listen only through your Web browser.
Reported from San Francisco — The major record labels plan to start selling digital songs today for a dime apiece. The catch: You can't carry them with you on an iPod.
Thomas Hesse, Sony BMG's president of digital business and U.S. sales, came up with the new pricing approach for the "Web song" while in discussions with Lala Media Inc., a digital music retail store and service. The Web song is stored online and can be listened to only through a computer's Web browser.
Sony, the three other major record labels and thousands of independent labels plan to sell Web songs via the revamped website Lala is unveiling today.
They hope customers will also buy, for an extra 79 or 89 cents, a version of the song they can download and transfer to portable devices or burn to CDs. But the 10-cent Web song demonstrates the willingness of the music industry to seek new revenue models in an era of declining CD sales.
"The psyche of the music industry right now is that not experimenting is riskier than experimenting," said Michael Nash, executive vice president of digital strategy and business development for Warner Music Group, one of Lala's investors.
Hesse said he wanted to give consumers a way to discover new artists and buy music in an inexpensive way.
"Let's make as many attractive possibilities out there for legal consumption of music" as we can, Hesse said in an interview.
Many Web services offer free streaming of music, which the companies pay for through advertising. Lala too offers free streams of its library of 6 million songs, but it doesn't run ads.
The Palo Alto company's relaunch comes during a year in which entrepreneurs and big entities alike have started music services, each with its own twist and almost all with the full support of the major recording companies.
In September, News Corp.'s MySpace relaunched MySpace Music, a joint venture with the major labels, that gave users ways to stream and buy music. This month, Nokia began selling phones in Britain with its Comes With Music subscription service, which allows a consumer to download music directly to a cellphone.
Lala is on its third business model but remains afloat thanks to $35 million in financial backing from investors Bain Capital, Ignition Partners and individuals.
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