Tuesday, December 21, 2010

Muve Service From Cricket Wireless Could Have Big Impact on Mobile Music

December 20, 2010 12:00 EST – 

By Antony Bruno 

Mobile companies have not fared particularly well offering their own music services. But prepaid operator Cricket Wireless hopes to buck this trend with the introduction of a new branded mobile music service called Muve, set to go live sometime in January.

Who? Cricket may only have about five million customers nationwide, but this is still an interesting launch to follow that could have significant implications on mobile music strategy if successful.

Let's start with the service itself. For a fixed monthly fee, users can download an unlimited number of songs and albums to a specially branded Muve music phone. The phone is a customized version of the Samsung Suede that prominently features a dedicated Muve button on the face, which launches the music service. It has licensing deals with all the major labels that include the right to create custom ringtones from every song in the catalog, as well as ringback tones from many as well.

It includes a version of the Shazam music ID service that links tagged songs directly to the Muve music database for downloading. A My DJ feature offers a cached automated playlist curated by the Muve staff and refreshed daily. The Get Social feature lets users share songs and playlists with other Muve users. And a cool Shout feature lets users embed music in text messages via a link that will stream the whole song when sent to other Muve users but only a 30-second sample to others.

Downloads are lightning fast -- less than 10 seconds -- and all the services are governed by a slick, easy-to-understand user interface. Unlike other mobile music services that slap mobile access to an existing online service, Muve was built from the ground up specifically for mobile by the Wilshire Media Group, led by former Virgin Digital president Zack Zalon.

Here's the kicker though: it's a mobile-only service. There's no Web version or dual downloads, or any of those hybrid mobile/online capabilities that other mobile music services have. Stop paying and you lose your music. But rather than treating this like a fault, Cricket touts it as a badge.

To understand why, you need to examine Cricket's user base. It's a prepaid operator, meaning users pay month-to-month. According to Cricket VP and GM of voice and data products Jeff Toig, half of Cricket users don't even own a computer. Another 70% don't have a landline phone. So their Cricket device is in a way their home computer and home phone combined.

Then there's the offer. For $55 a month (again, paid on a month-to-month basis) users get the full Muve unlimited music service as well as unlimited talk, text, photo messaging and Web access. By all accounts, that's a "feels like free" music service. Stop paying for a month, no problem... all your music and playlists will be waiting for you when you resume.

And for the music industry, it's a pretty sweet deal. For starters, labels get what they've always wanted: a cut of a mobile operator's monthly data service plan, not just a cut of the music service. The exact split isn't known, but this is the first time an operator has combined a music service so tightly with a monthly data plan.

Also, Cricket users skew high as music fans, but low as music consumers. Over 60% are African-American and Hispanic. Most don't have credit cards (70% pay their monthly bill in cash) which means they're not using iTunes. And Cricket is second only to Verizon in ringback tone sales despite being a fraction of the size (five million customers to Verizon's 93 million).

"This is going to be the most innovative service launch we've seen in the wireless space," Warner Music Group executive VP of digital strategy and business development Michael Nash says. "It's a homerun in terms of bring together the experience you want."

For Cricket, the goal is the same as any other service provider-reduce churn. The company is betting that its pay-per-month subscribers will be less willing to stop paying for a month or so at a time if it means also losing access to their music. If the stats bear this out in the year ahead, it could serve as a convincing selling point to larger operators -- either mobile carriers or Internet service providers -- for labels still negotiating similar deals that tie music access to data plans.

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