DMW: Ted Cohen: “Subscription Is Going To Win Over A La Carte Pricing”

Submitted by Jay Baage on October 3, 2007 – 11:14am.

Digital Music Forum West 2007 – There is no denying that the business of selling music in form of CDs is failing. However, there should be other ways to make money off music, right? Ways that are compatible with how music is experienced in a digital era. So what are they?

At our recent Millennials NYC Conference, Dan Porter, VP of Corporate Development at Virgin USA, said that the only people buying music from iTunes are 35-45 year olds from Silicon Valley and there are not enough of them to make the music industry prosper again. When DMFW kicked off in Hollywood on Wednesday, the music music industry is gathered to share the latest developments about what is going on, besides iTunes, in the digital music space.

“Subscription is going to win over a la carte purchasing”, said Ted Cohen, Managing Director, TAG Strategic in his introductory remarks. “The best defense against piracy is great label (approved) music services”, he continued.

As a sign of the uncertainty that still exists in the digital music market, the first panel called “The State of the Digital Union” immediately got into a discussion about Cohen’s statement. Most of the panelists agreed that there is no single model for monetizing music that will prevail.

“The civil war is over”, said David Pakman, CEO eMusic. “Subscription service is not THE answer, it is ONE answer. There are many.”

Ian Rogers, VP & GM, Yahoo Music put in a word for the new Amazon DRM-free music store: “You should take a look at it. It is F…ing awesome.”

My Take: If virtual world companies can make millions of dollars from selling virtual goods and services, it is not be unrealistic to assume that people should be willing to pay for music, if the proposition is appealing enough. If the industry is not making money, then the proposition is not appealing enough. Think about it. I agree with Ted Cohen that the best defense against piracy is not litigation, it’s great music services (but not necessarily subscription alone).

Posted by Ted • Wednesday, October 3, 2007 .