June 28, 2006
A world's first, British UBC Media just announced a download service that will allow consumers to buy songs while listening to them on digital radio.
UBC Media, a radio producer that also develops technology products and services for the broadcasting industry, will begin testing the service on Chrysalis Group's Heart station, with plans for a full roll-out by December 2006.
The digital music download (DMD) service is expected to generate GBP 95 million of turnover by 2012, with a profit of nearly 10 million. These estimates are based on the assumption that in six years 25 percent of mobile devices will be equipped with digital radio service, with cell phones playing a big part. Korean manufacturers LG and Samsung Electronics expect to sell 500,000 digital radio enabled phones in the UK over the next 18 months and about 10 million by the end of the decade.
Payment will follow a credit plan along the lines of pre-paid credit used for mobile phone calls. Songs will sell for around GBP 1.25, which is 60 percent more than what's charged for a song downloaded from iTunes in the UK. Value is added by the fact that songs aren't only downloaded to the user's phone, but also to a web-based music library that will allow users to copy the download to their iPod or other mp3 player.
Will satellite radio be able to follow the same path? (US satellite radio broadcaster XM is currently in a row with record labels over a gadget that lets listeners record songs.) One to watch! And to partner with if you're in the phone, music or gadget industry.