Yesterday, Amazon (AMZN) announced the launch of its Cloud Drive and accompanying Cloud Player.
The launch is significant in many ways, while underwhelming in others. Overall, I think it’s a net positive for the market and for consumers but a bit of a speedbump on where I think they need to go.
Cloud Drive is a “music locker”. In other words, it’s a cloud-based storage system that allows users to store music they own in the cloud. In that sense, it’s very different from either iTunes (local storage) or streaming music apps like Rhapsody, Spotify, Rdio or even Pandora.
Music Lockers are hardly new. MP3.com launched back in 1997 and there have been other efforts since. The music industry sued (after all litigation takes less effort than innovation) and the small companies were destined to fail as a result.
With this new effort, the music locker model for the first time has a deep pocketed sponsor behind it, with Google and Apple (begrudgingly) likely to follow suit.
First the good news:
Amazon has placed a stake in the ground saying that they do not need permission from music publishers to enable users to store and access their music in the cloud. That’s a good thing for consumers and for the market as a whole. With Google and Apple likely to follow, this makes for a more competitive landscape for music.
Amazon digital downloads are DRM-free, so you’re not locked into any one provider. It will also put pressure on Apple to make all of their content DRM-free. This is something the record companies will fight (after all, in the past they’d gotten me to purchase vinyl and CD versions of Blonde on Blonde and would want me to keep doing so every time my music system changes) but it has to happen.
Amazon gives you 5 GB of storage for free and will bump that to 20 GB free for the first year if you buy any digital music through Amazon. That’s a smart move. Amazon has done a lot to try to break through in this space, offering a free daily download of holiday songs during December, as well as other promotions along the way. But it still is more difficult to use than iTunes. I buy most of my music via Amazon but my daughter mostly uses iTunes and my wife just asks me to get her what she wants.
Now the Bad:
To start, I’m not a fan of the music locker model at all today. It seems that streaming is a much more compelling solution for consumers AND the music industry. More on that below. But first, a few specific points about the Amazon solution:
It’s obvious that this is an effort to make Amazon a more viable competitor to iTunes. And that’s a good thing. I already buy most of my digital downloads through Amazon. But 5 GB (or even 20 GB) is hardly going to hold my music collection. I’d need the 100 GB plan, which costs $100 per year. That’s nearly the cost of a year’s worth of Rhapsody Premier.
I’ve got about 25 GB worth of Amazon digital downloads already. But there doesn’t seem to be any way to automatically have that music show up in my digital locker. It seems that I have to upload those files back to Amazon. That’s a lot of work for me (and doesn’t seem an effective use of Amazon’s bandwidth, as they could easily move it around on their own servers).
The functionality of the Cloud Player itself is meh. Gee, I can pick by artist, album, song or genre, or build a playlist. Hey, it’s the identical functionality that came in my iPod. My first iPod. Nearly ten years ago. Where’s the innovation, Amazon? Where are the social and music discovery aspects that I find in basic services like Spotify, last.fm, Grooveshark or Pandora, not to mention things like Listening Room, Imeem or other new apps? I’m a believer in Reid Hoffman’s rule #6 – “launch early enough that you are embarrassed by your first release” but not in a mature market like this. If Amazon wants to displace iTunes, it needs to show innovation (or at least show the ability to copy the innovation of others).
But back to the key point
Whether or not Amazon delivered on some of the functionality I’ve outlined above, the key point is that they missed the model. I’m not that keen on the idea of music lockers at all. A music locker is basically just a continuation of the model we’ve had for music for 100 years. Whether buying vinyl, 8 track, cassette, CD or downloadable digital tracks, the model remains the same. I purchase music to own, rather than paying a subscription fee to access music. That model just doesn’t make a lot of sense in a digitally connected world. Why should I have to make a “commitment” to an album just because I want to hear it now? There’s just as much money to be made in a well-managed streaming service and it’s much more consumer friendly in the long run.
I’m still hoping for a meaningful Spotify US release. I use them extensively when I travel and would gladly pay for a Spotify service here. In the meantime, I’ll continue to use a hybrid of Amazon digital downloads on my iPhone and a mix of Rhapsody and Pandora for streaming.