Music price comparison site

6 08 2009

comparedownloadscreenshotThe internet is filled with dozens of sites that let you compare prices of things like car insurance, utilities, credit cards and even meerkats. Such sites are popular since they allow the consumer to get the best possible deal without the hassle of going to each individual store and comparing prices. Well, there is a new comparison site, imaginatively named Comparedownload.com, that allows you to compare the prices of music downloads from different stores like 7digital, Amazon, Tesco Digital, We7 and iTunes.

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Comparedownload.com is the first website in the UK that allows music fans to compare the price of music downloads and seems to have stumbled upon a gap in the market that seems so simple and obvious now that its mentioned. The website’s founder, James Bott, says that it was the frustration of having to search through different sites for the cheapest price for music downloads that lead him to develop this website.

 

According to the International Federation of the Phonographic Industry (IFPI), only 5% of total music downloads are done so legally. This means that there is a huge market for legal downloads if the other 95% are tapped into. If the market potential for online downloads is indeed so huge, why has it taken so long for a site that allows the consumer to compare prices of downloads to be launched? And that too this isn’t a venture by some business seeking to exploit a gap in the market, but the result of someone’s frustration and need.

 

Maybe its because there aren’t enough sites selling music legitimately that have huge catalogues that can be compared. The reason for that is perhaps that its too hard for sites trying to sell music legitimately to bring all the record companies together and convince them to allow a website to sell their songs. And if the website doesn’t have a wide collection of songs, customers will obviously not come. The other quick and simple alternative is file sharing, which of course is illegal.

 

There is of course another alternative, buying a CD. But what if you only want one single, and not the whole album? Also, it’s a lot less convenient than downloading music. CD sales, according to the IFPI, dropped by about 15% last year. Of course, the music industry will be quick to put the blame for the drop on illegal file sharers who want to listen to music, but pay nothing for it. But I don’t think that all those who share music do so because they are heartless or get some sort of pleasure by “stealing” someone’s work, as they are often portrayed. I think it’s a bit hasty to attribute the drop in sales of CD’s to online file sharing. Maybe its because the way people view music and the way they want to obtain their favourite music is changing.

 

Recent surveys suggest that an increasing number of people who previously got their music from file sharing are switching to legitimate music streaming sites like Last.fm, We7 and Spotify. But the business models of such music streaming is completely different from those of the music companies. Music companies want to charge the consumer for each individual download and control how many times the music is moved around whereas music streaming sites view the delivery of music as a service that would allow revenue to be generated by displaying relevant ads and through sales of complementary products like merchandise, tickets to gigs, etc. The biggest hurdle again for such streaming services I think are record labels that may need a lot of convincing to let the sites stream their music. Many are sceptical about streaming sites generating significant revenue that would compensate for the drop in CD sales.

 

To a certain extent, I think that it’s fair to say that the music companies are victims of their own greed and their inability to view the internet as a means of diversifying rather than viewing it as a threat to their business. There are a huge number of online retailers selling all kinds of things from books to computers and they have been operating for quite some time now. Yet, the number of online music sites are still quite low and only now beginning to increase. No wonder then that although you can buy pretty much anything on the web, it’s still relatively hard to buy music legally. It must be so hard to get them all on board and agree on particular business model that it takes somebody with utter determination and nerves of steel with financial backing to achieve a deal. Imagine the kind of problems that Steve Jobs must have faced of convincing each and every record company to make their catalogue available for sale when Apple was planning to launch the iTunes store.

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