eMusic to offer Sony back catalog

Danny Stein, eMusic’s new CEO, dropped some major news just now on eMusic’s semi-official 17 Dots blog. As reported in more detail in the New York Times, Sony Music Entertainment (home of Arista, Epic, Columbia, and RCA, among others) has decided to release its back-catalog material (anything over 2 years old) to eMusic—basically what eMusic management has apparently been urging them and other major labels to do for ages. (For example, David Pakman addressed this in several of his interviews.)

The major trade-off (no pun intended) seems to be that eMusic has agreed to slightly raise prices and reduce the number of downloads for some of its monthly plans, in effect imposing a per-track price that is higher than its current prices, which range from $0.40 per track for the eMusic Basic plan (30 downloads for $11.99 per month) to $0.25 per month for the eMusic Connoisseur plan (100 downloads for $24.99 per month). What we don’t know yet is exactly which plans will be affected, and what the price increases will be. My personal guess is that the eMusic Basic plan will remain the same, but that the other plans will be revised to bring the lowest per-track price up to $0.30 or even higher.

So much for the bad news. On the positive side, this deal will give eMusic subscribers better access to the important works of past musical eras, will make eMusic more attractive to potential subscribers, and if successful may persuade other major labels to do likewise. This in turn makes it more likely that eMusic will survive and even thrive as a (relatively) low-price outlet for customers looking beyond the latest hits.

In his blog post Danny Stein raised a point about how this might change how customers might perceive and experience eMusic:

We’ve been requested to carry major label titles for years, but we always have gone back and forth on whether it would change the fabric of eMusic. We don’t think it makes sense to exclude great artists simply because their label partner is one of four specific companies. We look to some of our favorite music—The Sex Pistols, The Clash—and we certainly never think to ourselves Major Label. What do you think? Do major and indie mean anything to you or is this just industry jargon?

In the past the record labels now aggregated under the term major were in fact where the most important innovations in popular music were happening (as Bob Lefsetz never tires of reminding us). I think that including older releases from some of those labels in the overall eMusic offering is perfectly consistent with eMusic’s current positioning of itself as the internet’s corner music store, especially if eMusic is going to pull out all the stops on providing context and recommendation. (Which I expect will happen—to the extent that this is an experiment, eMusic has every motivation to make it successful.)

I think the major downside other than the price increases is that people will be very mistrustful of having a repeat of the Rolling Stones fiasco. That apparently wasn’t eMusic’s fault, but if Bruce Stringsteen or whoever decides that they don’t like their music being cheapened by being sold at eMusic prices and is successful in getting it pulled, or if Sony upper management gets cold feet and decides to kill the entire deal, that’s going to leave a pretty sour taste in the mouths of eMusic subscribers, especially given that the new higher prices will likely remain in effect.