BMG announced that they were going to start charging a monthly subscription fee for Napster this summer. Smart move. If they keep the fee low, like $4 to $5 a month, they'll manage to keep a fair amount of their users. It won't be a hugely profitable business for them, especially after they're forced to share the revenues with record labels. But it's certainly high margin. Let's say 10 million users sign up. That's $50 million a month, $600 million a year. All for a piece of software that's already been built, and the cost of some servers around the country. Assume 80% margins, and they have to hand 70% of proceeds over to the record labels, and they still keep $144 million a year. That's a damn good business.
How cool, a small content sharing exchange for music, using the CD library of global Napster users. Like a stock market, and Napster charges a fee for those wishing to participate in the exchange.
I do think they need to improve the interface. They could do a lot more with the entire interface to make it easier to use and to market particular artists and tracks more strongly.
Chatted with Howie today, for the first time in a long time. He's still pursuing the DJ thing outside of work. I can't wait to hear his first promo CD. That should be interesting. He's thinking of applying to business school this year.
I'm in somewhat of a blah mood, one of those where I feel like I'm not really engaged with the world around me. I don't feel like I'm doing anything. Maybe I just need to go out for a long run or something like that.
On a separate note, Baseball America ranked the White Sox and Cubs #1 and #2 in their annual farm system evaluation. Cool for my Cubs. Can't wait to see some of their young talent in the majors. Maybe they will win a World Series in my lifetime.