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Music Ally: Nokia Comes With Music ‘Impressive’ So Far

Music Ally took an early look at Nokia’s much-hyped Comes With Music service over in the UK, and early impressions are that it’s pretty good, actually.

“So far, we’re mightily impressed with the intuitive and user-friendly nature of the Nokia Music (and by extension Comes With Music) interface. Apple has been rightly lauded for making the music purchase and playback process simple and easy for non-techies, but Nokia has clearly paid attention to iTune’s [sic] better points too.”

The music files turn out to be 192 Kbps WMA tracks, which sound pretty good but obviously have DRM; the DRM is good for unlimited plays but no burn or transfer rights.

Nokia Launches Comes With Music

As expected, Nokia, the world’s top mobile phone maker, is launching its free music platform on Thursday, according to Reuters, as the company throws down the gauntlet for Apple’s dominance of the digital music market.

Nokia’s package differs from other music services in that buyers can keep all of the music they download in the first 12 months. There’s no additional charge to the consumer at all, since the service is bundled in with the price of the phone.

“‘Comes with Music’ could potentially bring free music to millions of consumers, radically changing the music industry, and offering a significant threat to Apple’s dominance,” said Strategy Analytics’ David MacQueen in a research article. “In a market where price and selection are so much more important than brand to consumers, Apple cannot count on retaining users when competing with an offering which seems free to the end user.”

Nokia Launching Free ‘Comes with Music’ Program

HELSINKI (Reuters) – Nokia, the world’s top mobile phone maker, will launch its free music package on Thursday, issuing a challenge to Apple‘s dominance of the digital music market.

Nokia is expected to unveil more details of its ‘Comes with Music’ package at an analyst and media event in London. The Finnish firm will also launch its first touch-screen phone, to rival Apple’s popular iPhone, sources have told Reuters.

‘Comes with Music’ and similar products from other hardware vendors could help the music industry make up for falling CD sales and cut illegal downloads.

The battle for mobile music is increasingly crowded, with Sony Ericsson launching its music package this month in Sweden, while South Korea’s LG Electronics plans a service similar to Nokia’s.

Nokia’s package will differ from others on the market as users can keep all the music they have downloaded during a 12- month subscription period. There are no charges for tracks downloaded, since the cost is bundled to the phone price.

“‘Comes with Music’ could potentially bring free music to millions of consumers, radically changing the music industry, and offering a significant threat to Apple’s dominance,” Strategy Analytics’ David MacQueen said in a research report.

“In a market where price and selection are so much more important than brand to consumers, Apple cannot count on retaining users when competing with an offering which seems free to the end user.”

Nokia stock was 1.1 percent softer at 12.97 euros ahead of the expected news versus a 0.34 percent firmer sector index. The stock has more than halved in 2008 on industry growth worries and Nokia’s third-quarter market share warning in September.

PUSH INTO SERVICES

The music download package is Nokia’s first major push into the services business. Last year the company unveiled a revamp of its whole organization, aiming to build a new business from Internet services to combat slowing handset growth.

“‘Comes with Music’ sees Nokia going head to head with new competitors—most notably seizing the initiative from Apple,” said CCS Insight analyst Paolo Pescatore.

Nokia has acknowledged the impact Apple has made on the industry with its iPhone over the past year, saying the Cupertino, California-based computer and consumer electronics company had done the mobile phone industry “a big favor.”

“We have a new, credible competitor in this business,” Nokia Chief Executive Olli-Pekka Kallasvuo told the Churchill Club on Wednesday, a speakers’ forum for Silicon Valley civic leaders.

“Of course we need to be able to respond to any competitor and we will.”

Michael McGuire, analyst with Gartner, said Apple and Nokia are set to fight for the same market, but with different approaches, as Apple charges per-track-downloads, while Nokia’s offering is more of subscription service.

HOPING TO CUT FILE-SHARING

Last month Nokia unveiled the first ‘Comes with Music’ model, a new version of its successful 531O phone, and said it will go on sale this year.

Nokia is expected to publish pricing details or a sales start date on Thursday. Carphone Warehouse last month said on its website that sales would start Oct 17, but later removed the information.

Analysts said the choice of a relatively cheap model was a clear indication Nokia was trying to win over consumers who often are not paying for music but getting it through file-sharing sites on the Internet.

“I think this is the first time the music industry can state they have a proper tool to fight file-sharing,” said Mark Mulligan, analyst at Jupiter Research.

Recent survey from research firm Strategy Analytics shows there is demand for music packages—84 percent of consumers said they would pay for a service like Comes with Music, with 34 percent willing to pay $10 or more per month.

(Reporting by Tarmo Virki, Additional reporting by David Lawsky in San Francisco and Eric Auchard in Santa Clara; editing by John Stonestreet)

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