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Perhaps the hibernation period is ending...
"There's still a big market opportunity in telematics," said Thilo Koslowski, vice president and lead automotive analyst for Gartner G2. "It's hibernating right now and going through a healthy cleansing period, which is forcing everyone to develop smarter products that are tailored to consumers' real needs."
ECLIPSE !!!!!!!!!
Trend, that's the spirit !!!
Enjoy !
Gilgamash, congrats on your SMSI find.
This market negativity will wane at some point. The political focus is about to shift back on the economy as we enter into the election cycle.
I think George W will learn from his father's miscue.
And for an extra $19 you can get a USB cable...to go with your reduced battery capacity ipod. Hear that window users ???
They certainly set the bar.
Gilgamash, here's the story to which you refer...
Smith Micro could ride Wi-Fi wave
Commentary: Linking wireless networks carries big risks
By Mike Tarsala, CBS.MarketWatch.com
Last Update: 12:06 AM ET April 30, 2003
ALISO VIEJO, Calif. (CBS.MW) -- Smith Micro, a tiny software maker that first made its mark in the 56k-modem wars in the mid-90s, could re-emerge as one of the early mercenaries in the fight to boost sales of Wi-Fi network equipment.
Smith Micro's been as visible as tourists in Toronto lately. Sales were a little north of $6 million last year, and although it has drastically pared losses, the company is still losing money. On an average day, about 7,700 Smith Micro shares trade on Nasdaq. The stock (SMSI: news, chart) has slid from an all-time high of about $32 in March 2000, to less than $1 today.
But with the latest version of its flagship data connectivity software, Smith Micro's executives say the company stands a good chance of ramping sales this year. The company's upgraded main product is one of the first that lets mobile workers switch between cell-phone-based data networks and Wi-Fi networks on the fly. It seems likely to make Smith Micro a sought-after partner of major telecom companies.
"We're in a leadership role in providing this kind of software to carriers," said William Smith, Smith Micro's chief executive. "Verizon (VZ: news, chart) and Cingular Wireless buy products through us exclusively -- and they are No. 1 and No. 2 in the wireless business in North America."
Although sales in Smith Micro's fourth-quarter fell about 1 percent from the previous year to $1.87 million, the company, which trades at a little more than 1 times sales, says it still expects to turn a profit for the year, while increasing sales by at least 20 percent.
Bright spot
Wi-Fi is one of the only technologies that excites analysts these days, because it has the potential to be the kind of grassroots technology movement from which the Internet grew. It gives customers a low-cost way to wirelessly roam with a laptop computer or a hand-held. As long as you're a few hundred feet of a transmitter, you can hook up to a Wi-Fi Internet connection at broadband speed. The transmitters are already in more than half of Starbucks (SBUX: news, chart) coffeehouses, and they're spreading fast to airport terminals, apartment buildings and corporate offices.
As a result, industry leaders including Intel (INTC: news, chart), with its Centrino chip, Cisco (CSCO: news, chart) with its $500 million purchase of Wi-Fi equipment maker Linksys, and Microsoft (MSFT: news, chart) with increased operating system support all are all placing bets on Wi-Fi.
"Wi-Fi is the hottest thing right now, in all of telecom," said Greg Gorbatenko, analyst with Loop Capital Markets in Chicago. "The market is there. Investors believe in it, and they'll vote with their dollars that this is a good idea."
But there are glaring problems that keep Wi-Fi from being a runaway hit: Transmitters are still hard to find in some areas; if you stray beyond the range of the transmitter, you lose your connection; and major telecom carriers aren't spending to put advanced services on Wi-Fi, since many already spent billions on building 2.5 and 3G wireless networks that use cell-phone technology.
That's where Smith Micro comes in. The company's technology can keep your laptop connection going on a cell phone network, then automatically ask if you want to switch to a faster, cheaper Wi-Fi connection when you encounter a transmitter. When you roam away from the Wi-Fi, you can automatically switch back to the cell phone network -- all without losing your work.
Out of range
Network-switching from cell-phone to Wi-Fi networks is something that excites telecom carriers, says Carl Zetie, analyst at Forrester Research. Instead of competing against Wi-Fi, it's a way for the carriers to generate demand from the new technology, by making sure you keep your connection going when you're not near a Wi-Fi transmitter. It helps make their big investments in 2.5 and 3G wireless in the bubble years more viable.
"The range in which a Wi-Fi network can operate is limited, and you're always going to need the cell phone-based wireless WAN," Smith says. "Both serve a purpose."
Among the telecom companies, T-Mobile (DT: news, chart) has taken the lead in offering access to Wi-Fi networks. Through a partnership with a company called Boingo, it offers software to jump from one Wi-Fi hotspot to another. But so far, the company doesn't allow roaming between its Wi-Fi and cell-phone data networks. It's not likely to happen until at least the beginning of next year, says Phillip Redman, Boston-based analyst with Gartner Inc.
With help from Smith Micro, Verizon Wireless might beat T-Mobile to the punch. A source familiar with the situation says that Verizon Wireless, which has more than 30 million cell phone subscribers, plans to announce a data service for businesses and consumers in May that would switch between cell phone and Wi-Fi networks. The service should be up and running by year's end.
And according to the source, Verizon Wireless has been in exclusive talks with Smith Micro to provide the key part of front-end software that would make the service possible. The sources say that any deal with Verizon Wireless could potentially represent millions in business over several years for the tiny software maker, with all of 40 employees.
Verizon Wireless already announced in mid-May at an industry conference that it planned a new wireless offering that could tap into Wi-Fi hotspots, but the company didn't' announce anything definitive.
There are very significant risks to any investment in Smith Micro. The company's stock is so thinly traded that it'd be hard to sell off if business started to tank. The company needs to raise its stock price to more than $1 by the fall, or face likely Nasdaq delisting. Smith Micro said last week that shareholders gave the OK to a reverse stock split, but that would serve to further restrict the number of shares in the market, exacerbating the liquidity problem.
Another risk is that Smith Micro continues to bleed cash, and it only has about $3 million of it left. As a result, there's a large short position in the company's shares. On the plus side, however, is that the company has no long-term debt.
Smith Micro faces an endless string of obscure competitors. There are dozens of privately held start-up companies that could develop similar technologies to its main product.
And while Wi-Fi is exciting, analysts warn that the market is really unproven at this point. No company is really making money on it. It remains to be seen how much companies can charge for advanced wireless services, and just as important, how they'll bill for it.
While it's too early to start a love affair with Wi-Fi, it is one of the few bright spots from a technology standpoint in recent years. And Smith Micro is a pint-sized software maker that could be at the right place at the right time.
Mike Tarsala is a San Francisco-based reporter for CBS.MarketWatch.com.
"Per our engineering department, all of the
players are firmware upgradeable to accommodate new audio codecs, DRM
systems and additional functionality."
Of all the new electronic gizmos coming onto the scene, the HDD MP3 player certainly is making waves, thanks to Apple's latest news and continued marketing efforts. Interesting how Apple seems to be making big news with an MP3 player as it continues to target the prime demographic.
They have been marketing to only 3% of the computer market, for the most part, and are attempting to expand into the windows space. This market looks to likely continue to garner its fair share of attention and consumer dollars. Their growth curve appears healthy.
With this comes an increasing consumer awareness and education of a growing product sector for the entire industry at large.
Hopefully the Odyssey 1000 will be able to ride the coat tails somewhat and experience the growth target which its management team is hoping to attain by summertime.
Talking With Their Wallets...
(segment of an article relating to insider buying)
By Jack Hough
April 11, 2003
In This Story
The Rationale
Think of a company's insiders as your professional tasters. When these corporate officers — or other beneficial owners with more than a 10% stake — start nibbling on their own shares, it's a good sign that it's safe for you to take a bite.
After all, insiders have a special perspective on day-to-day operations, and often know more about their businesses than anyone else. That's why savvy investors pay plenty of attention to their purchases.
Insiders sell shares just as often, though that's not as good of an indication of their views. That's because company officers often receive stock or options as part of their compensation, and routinely sell shares to finance big expenditures like a house or a kid's college tuition.
When insiders buy stock, though, they spend their own money. That endorsement speaks louder than press releases and projections coming from the boardroom. And, fortunately, investors can track purchases easily, since the SEC requires that insiders report trades within two business days.
The EDIG website provides the SEC filing link...
http://www.sec.gov/cgi-bin/browse-edgar?company=e_digital&CIK=&State=&SIC=&action=ge....
Cassandra, your first time reading it or did you miss the sections highlighted by Tinroad and JBocca ?
Anytime we EDIG investors can be of help, let us know.
(b) Notwithstanding the provisions hereof, the Company shall have the right
at any time after it shall have given written notice pursuant hereto
(irrespective of whether a written request for inclusion of any such securities
shall have been made) to elect not to file any such proposed registration
statement, or to withdraw the same after the filing but prior to the effective
date thereof.
No wonder Cassandra would not post her proof...lmao.
Just enough info to keep investors confused, it would appear.
Why no mention of the sections posted by JBocca or Tinroad ?
ERRORS and OMISSIONS....
From massive dilution to nothing doing--back field in motion baby, you know it's against the rules.
Cassandra, when did this become a quiz show ?
If you've got the answers, give them to us, since the information you claim to have is relevant to the investment, yet is being disputed by others.
The ball's in your court.
I would think Cassandra would want to prove her point and post, for all to see, her claim that there will definitely be a dilution by June 30th.
Instead, she'd rather debate it.
Maybe the poster misunderstood Putnam. You should clear this up for the board.
Cassandra, be careful what you ask for because it appears you might just be the rumor monger referenced in that post.
I hope not because you seem like such a champ.
How do you make sense from that post that there is no dilution and why do you want me to post about something that appears to be a figment of your imagination ?
PLEASE POST, from the SEC filings, where it says there will be a dilution by June 30th before we all waste our time here debating your supposition.
You'd sell an entire position for 1/16 ?
I guess that's a day trader's approach to investing ? Go right ahead, there's more than one way to approach this.
You do as you say, don't you ?
Impact ? Not according to this post from Agora...
Subject: I spoke with Robert today
From EDIGOKIE
PostID 249262 On Wednesday, April 23, 2003 (EST) at 4:48:38 PM
--------------------------------------------------------------------------------
I was confused about the rumors/stories/lies floating around about reverse splits and additional shares being issued. In Robert's words, there is no substance to either report. The company has never said there would never be a reverse split, but RP was emphatic that one would not happend unless and until the company was profitable and the share price had shown dramatic improvement. The only reason to even consider one would be to jump the PPS up to qualify for the NAS and attract institutional investors. Not being planned but never say never is probably the best summation.
Someone was running the rumor about additional shares being required on June 30. Anyone who knows the specifics please call Robert, because neither he nor Ran Furman know of any reason why that would happen or be required to happen. No previous financing deal requires additional shares.
The company used the the 2000 unit figure for O-1000s as a measure of revenue neutrality. Selling 2000 per month at current margins should cover burn rate. They are still hoping/expecting to see that figure reached over the next two months. That also means our estimates of approx $150 per unit is pretty close.
I asked about C/Net inventory. He said they were playing that by ear until they see what kind of demand is generated from their site. In other words, we may see inventory problems because we simply can't afford to front a bunch of initial inventory to C/Net without some indication of potential volume.
Hope this answers some questions. As I have told family and friends I got into edig - lean into the wind a little while longer and I feel confident we will all be rewarded. JMHOFWIW. Best of luck all
Kirk
Volume about on par with yesterday's performance...
IMO, not particularly significant. Perhaps churning day traders or investors changing places, either way the dollar volume is no big deal.
Good luck Dougal !
Keep us posted.
rollingrock,
I believe that last quarter improved over the previous quarter and that guidance for the most recent quarter has indicated continued improvement...all of this since shifting to today's business model from the previous Collier plan.
I believe this was stated in the webcast.
As I recall, EDIG did not lead the nasdaq the last time it hit its all time high and I don't think anyone would expect them to do so now.
EDIG's stock price will react when there is news that any one of several of its business opportunities is gaining traction, with orders of new products, or any other significant developments occurs, and not likely before.
But I do like your thinking, invest in a company that appears to be growing and is profitable...my very thoughts for EDIG, should In Flight Entertainment products or the ECLIPSE auto infotainment product line start selling, or the WIRELESS project with its first customer being HP get some positive press or when and if any OEMs start selling the Odyssey 1000...
OT: spectra,
I need your email address as I cannot private message you. Apparently Matt took that feature away.
Dollar volume is about $64,000...
This latest Hewlett-Packard development is interesting...
HP's new iPaq set to be unveiled in late May
Xscale-based device to have at least 64MB of SDRAM, 32MB of ROM
By Martyn Williams April 22, 2003
Hewlett-Packard is expected to unveil its new iPaq h2200 PDA (personal digital assistant) on May 30, according to information given by High Tech Computer (HTC), the Taiwanese company that is making the device for HP.
The information was included in a letter to the U.S. Federal Communications Commission (FCC) that the government unit published on its Web site. Like all devices that use radio, the Bluetooth-enabled iPaq h2200 required clearance from the FCC before it can go on sale and it was as part of this approval process that details of the PDA were added to a publicly accessible FCC database in early April.
HTC recently decided that this gave away too much pre-launch information about the device, and wrote a letter to the FCC aimed at removing the information from the public domain until the product launch. In doing so, the company appears to have inadvertently let slip the probable announcement date for the device.
''Because these two products are confidential to market until May 30, please set aside the FCC grant ... as quickly as possible,'' HTC manager Dalton Chuang wrote in an undated letter that replaced the product approval details on the FCC Web site late last week. ''After finishing [the] above, please also un-set aside (sic) these two grant (sic) so that the information is back on the FCC's Web site on May 30.''
The device is based on either a 200MHz or 400MHz Xscale processor from Intel and will be available with at least 64MB of SDRAM (synchronous dynamic RAM) and 32MB of ROM, according to a draft version of the user manual that was published in early April on the FCC web site.
HP could not immediately be reached for comment.
Trend, very cool ! Top 10 must haves....now maybe someone will debate whether that's cool or just luke warm.
http://electronics.cnet.com/electronics/0-3622-8-20329163-1.html?tag=ld
Duke, that'll just make the Odyssey 1000 that much more competitive.
Do you have a timeframe for that development ?
SOLD OUT (again)-The Odyssey 1000 is currently on backorder.
All orders will be filled in the order they are received.
Alert: As always, this is not a full review, but my tips for it. Check www.cnet.com for reviews and download its manual from www.edig.com for details. This page is to be updated whenever I'll have more time to hack this great player, so stay tuned.
Alert: The case is very easy to open - just 4 screws. The battery, attached on hard drive top, can be easily replaced when its life finally ends. There is plenty extra room inside for hackers to add a cell phone battery or three gum batteries, or to add a good amp like mine. I don't understand why Edig did not mount the hard drive closer to the circuit board to make the player much thinner - even thinner than iPod.
Interesting next generation development perhaps ???
Tinroad, nice find...
Too bad all the pictures are with the case on, not highlighting the very cool mirror finish and hologram label...but great comparison to the ipod.
http://www.fixup.net/tips/mp3/
rwrf, to answer your private message question, since my private message priviledges have been revoked...
D&M Holdings to Purchase ReplayTV and Rio Assets
Bid Accepted by Court, Transfer of Assets to be Completed Within Two Weeks
SANTA CLARA, Calif., April 16 /PRNewswire-FirstCall/ -- SONICblue(TM) Incorporated today announced that D&M Holdings Inc. (TSE II: 6735) was the successful bidder in bankruptcy court auctions for SONICblue's ReplayTV(R) and Rio(R) business units, with a combined purchase price for both units of $36.2 million.
"We believe that ReplayTV and Rio are the perfect complement to our existing product line," said Tatsuo Kabumoto, chief executive officer and president, D&M Holdings. "Not only will we leverage the technology to enhance our existing products, we plan to grow and extend our customer base by adding the ReplayTV and Rio lines to our product portfolio."
"With this sale, we finish a difficult chapter in our history and begin a new phase that we believe will be more conducive to the success of these businesses," said Gregory Ballard, chief executive officer, SONICblue. "We have done all that we can for our creditors, and our product lines will continue to compete successfully in the marketplace. Many if not most of our employees will continue their work, and our customers will continue to enjoy Rio and ReplayTV in their homes."
About SONICblue Incorporated
SONICblue holds a focused technology portfolio that includes Rio(R) digital audio players; ReplayTV(R) personal television technology and software solutions; and GoVideo(R) integrated DVD+VCRs, Dual-Deck(TM) VCRs, and digital home theater systems.
About D&M Holdings Inc.
D&M Holdings is based in Tokyo and is the parent company of Denon and Marantz, the global industry leaders in the specialist home theater, audio/video consumer electronics and professional audio markets, with a strong and long-standing heritage of manufacturing and marketing high-performance audio and video components.
Except for the historical information contained herein, the matters set forth in this press release, including, but not limited to, the anticipated completion dates of the sales of Rio and ReplayTV assets and statements regarding the future success of product lines and SONICblue customers' enjoyment of products are forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including, but not limited to, inability of the parities to complete the transaction, the availability and feasibility of strategic options, general economic and industry conditions, the impact of competitive products and pricing and of alternative technological advances, the release of new products from competitors, product engineering and marketing decisions and other risks detailed from time to time in the SEC reports of SONICblue Incorporated, including its annual report on Form 10-K for the period ended December 31, 2001 and its quarterly report on Form 10-Q for the period ended September 30, 2002. These forward-looking statements speak only as of the date hereof. SONICblue disclaims any obligation to update these forward-looking statements.
NOTE: Rio, GoVideo and ReplayTV are registered trademarks of SONICblue Incorporated. SONICblue and Dual-Deck are trademarks of SONICblue.
78,000 units sold in just one quarter....
ipod's high price point does not hinder growth...
I think this indicates that the demand for sophisticated high end HDD MP3 players is there. Mining that market is the challenge. From the latest reports the HDD market segment will be the fastest growing market segment for MP3 players.
''iPod portable music players - a growing niche for Apple, which sold 78,000 iPods in the second quarter.''
This is a growing market segment.
Turning this potential into a market reality is management's challenge.
Frustating to say the least
"For the fourth consecutive year, SONICblue lead the way in worldwide unit shipments of solid state and HDD portable players in 2002."
sblu has been bought out, and although their buyer plans to incorporate their line of products, one wonders how this change will effect their market share moving forward.
Tenderloin: I like those figures..."Worldwide portable digital music player unit shipments (including solid state, HDD, CD/MP3 and NetMD products) will grow from about 6.8 million in 2002 to over 36 million in 2007, with hard disk drive-based players experiencing the highest growth rate. CD/MP3 players will have the highest volumes, however, with about 22% of all portable CD players incorporating MP3 technology in 2003.
Hollywoodhills,
I don't recall if management ever bought stock directly out of their own pockets, but rather were granted their positions as a result of their management positions. I could be wrong but I don't recall them ever buying since early '99 when I first invested.
I do recall them selling some of their position at around $12, on the way up in January of '00.
Considering the four ventures in which the company is now involved, IFE, ECLIPSE, WIRELESS and the ODYSSEY 1000, and the current restructuring and cost cutting that has taken place over the past year, I am uncertain why only the Chairman of the Board, Alex Diaz, has been the only EDIG official to step up.
While the economy certainly has not yet incentivised buyers to return to the stock market, EDIG, at its 3 year low, certainly is a much lower risk investment than it was last year.
Considering the aforementioned four new areas for revenue generation supposedly coming online beginning now and into summer, I'm not sure why they don't give the stock and investors a vote of confidence by increasing their positions.
I have heard the excuse of buying on "insider" info and I don't buy that anymore as IFE, ECLIPSE, ODYSSEY 1000 and WIRELESS are all publicly known entities.
Mangement needs to send a message, IMO.
This company is not lacking potential, but rather confidence, and nothing speaks to confidence like insider buying.
Odyssey 1000 appears back in stock !
Certain Demise?
The music industry is bracing for a future that will involve the death of CD stores and the rise of MP3 players.
By GREG KOT CHICAGO TRIBUNE
Published: April 14, 2003, 06:42:16 AM PDT
When it was introduced, the compact disc helped bail out the music business: Domestic sales of the new technology zoomed from 800,000 copies in 1983 to 288 million by 1990, and continued to surge by the hundreds of millions through the '90s.
But with March marking the CD's 20th anniversary, the boom is over.
Compact disc shipments in the U.S. plunged nearly 9 percent last year to just more than 800 million, according to the Recording Industry Association of America (RIAA). The statistics confirm a downward trend that has been gaining steam since 2001, and continues this year, with CD sales down more than 6 percent from their already slack 2002 pace.
The ripple effect is only beginning as the music industry braces for a future that will involve the death of CD stores and the rise of wireless, pocket-size MP3 players that will enable consumers to access thousands of hours of music at the touch of a button. The only real question is how long it will take for those scenarios to become reality.
''You'll see CD sections in stores decline quickly over the next few years because they will be replaced by technology that provides dirt-cheap storage and the ability to basically access and play any type of music anytime, anywhere,'' says Mike Dreese, CEO and founder of Newbury Comics, a New England record-store chain.
''Wireless technology basically will create a world where we can have anything we want all the time.'' The death knell is already ringing for CD stores, some retailers and industry observers say. In January, two major chains -- Warehouse Entertainment and Value Music -- filed for Chapter 11 bankruptcy protection. And nearly 500 music specialty stores nationwide have been shut down in recent months.
''Brick-and-mortar specialist CD stores are done in five years,'' Dreese says. ''Stores like Tower or Sam Goody or Virgin are fast becoming anachronisms.''
Not so fast, says Dan Hart, CEO of Echo, a joint venture of retailers (Best Buy, Tower Records, Virgin Entertainment, Warehouse Music, Hastings Entertainment and Trans World Entertainment) that is licensing songs from labels and plans to begin offering in-store downloads this year. Internet retailing was one of the few growth areas for music stores last year, with sales up 8.4 percent to 8.1 million units, according to Nielsen SoundScan.
''There's no question CD sales are declining, but the phase-out of retail will take longer than people predict -- it'll be more like 30 years rather than five,'' he says. ''There is a whole generation of people out there educated to using CDs as their primary music format.''
But even Hart says that to retain a role in the marketplace, CDs will have to evolve.
For two decades, record companies bathed in profit, thanks to the compact disc. The rise of the new digital technology prompted many labels to reissue their long-neglected back catalogs on CD: Bands like The Beatles, The Rolling Stones, Aerosmith and The Who made millions of dollars for their respective labels simply by having their past albums transferred to the new digital format, sometimes several times over.
The shelved work of artists such as Bob Dylan, Eric Clapton and Robert Johnson was repackaged in multi-CD box sets and sold millions of copies.
But in the past three years, the bottom fell out of the CD market.
Why the sudden decline in what had been an industry staple? The RIAA blames Internet piracy: file-sharing by consumers is proliferating, with millions downloading free MP3 music files daily through services such as Soulseek and KaZaa. MP3 files are digitally encoded files that can be downloaded from the Internet, posted on a Web site, sent via e-mail or stored on a computer hard drive, then played back or transferred onto blank CDs. KaZaa alone claims more than 9 million monthly users. Six of the leading free file-sharing applications were being used by 14 million consumers a month in a recent comScore Networks analysis.
Sales of blank CDs soared past the 1 billion mark worldwide in 2000 and increased 40 percent last year. Illegal CDs -- often manufactured and copied on personal computers from free Internet downloads -- are now routinely sold for a few dollars in school lunchrooms and on playgrounds, and are available on street corners from New York to Hong Kong. ''When 23 percent of surveyed music consumers say they are not buying more music because they are downloading or copying their music for free, we cannot ignore the impact on the marketplace,'' says Hilary Rosen, president and CEO of the RIAA.
But there are other pressing issues: the $18.98 retail price of most CDs, when the industry is phasing out less expensive options, such as CD singles and cassettes; the dearth of credible acts at a time when the music industry is more interested in quarterly profits to satisfy corporate shareholders rather than long-term artist development; and the rise of a generation of consumers for whom music has become demystified and devalued.
''I wish people would realize what value music plays in their lives and would remunerate artists accordingly,'' says singer-guitarist Bob Mould, who now releases his music on his own Web-based record label, ''but if people want music to be free, it'll be free.''
Industry slow to respond
The industry's reluctance to accept that scenario has cost it dearly, observers say, causing it to fall behind in figuring out ways to exploit the new technology to its advantage. ''The relationship between artists and labels has been ruptured over such issues,'' says entertainment attorney L. Londell McMillan. ''Is music worth $10? Is it worth nothing? Something in between? While the artists and labels are bickering, the money is going elsewhere.'' The industry has belatedly responded to the crisis by introducing a variety of Internet subscription services, which essentially try to induce consumers to pay as little as a few dollars a month for something they can readily get for free through rogue services on the Web.
''How we compete with 'free''' is the big question facing the music industry and its nascent subscription services, says Pam Horovitz, president of the National Association of Recording Merchandisers. ''The solution is to make something better than free.''
The industry is putting its future in the digital clutches of value-added CDs, replete with so many extras (DVDs, bonus CDs, artwork and graphics) that to download all the data on a personal computer would tax most hard drives.
''People will still want to go to stores to browse and hold the things they are considering to buy,'' Echo's Hart insists. ''In addition, stores can provide a faster connection to the Internet, so that consumers can transfer tens of thousands of gigabytes to their iPod player in minutes. It'll be like going to the filling station for music consumers.''
Retailers will still have a role in the music world, Dreese insists, but only if they diversify. Newbury, he says, is transitioning into licensed goods. In the same way, the music industry will survive if it starts focusing on building artists who can generate multiple revenue streams.
''It's the Tiger Woods model of marketing,'' he says. ''Tiger Woods doesn't make nearly as much money on golf as he does on everything else he does: endorsements, speaking engagements, commercials. The role of the record label is going to be as a venture capital brand-building organization. It'll be perfectly reasonable for them to approach the next Avril Lavigne and say we'll give you a million dollars upfront, but we want a revenue split of all future movies, concerts, endorsements and merchandise.''
In the CD-free future, music will be marketed everywhere. ''You open a can of Coke and it plays a song,'' Dreese speculates, ''which makes the can a collectible.''
It means the major labels will be in the business of selling only the most mainstream artists, those capable of achieving Jennifer Lopez-like cross-promotional revenue levels. Artists of lesser stature will be able to use the Internet to direct-market to their fans.
Some of those fans will still be demanding CDs. But those die-hards will find themselves in an increasing minority, says Bruce Lehman, president of the International Intellectual Property Institute: ''Consumers are saying, 'I want to get rid of all my CDs. I want a service that by pressing a button, I hear music through any device in the house.'''
As retailers and record companies struggle to meet that demand, artists and consumers stand to thrive. ''The end of CDs doesn't mean the end of music,'' Dreese says. ''On the contrary, it means there will be more music more widely available at a more reasonable price than ever before. In three to four years, we'll have a better consumer experience and a more profitable artist experience.''
THE ASSOCIATED PRESS The music industry is bracing for a future that will involve the death of CD stores and the rise of MP3 players.
spectra,
Sorry I couldn't respond to your private message but due to my rap sheet here on ihub it is no longer allowed without paying a monthly fee.
To answer your question, I primarily post on
http://www.agoracom.com/nonmemforum/main.asp?pgnum=1&topic=e%2EDigital&tr=
It appears to be mostly investors interested in a rational discussion of their investment.
I plan to post here as well.
Matt,
3 posts on the EDIG board so far today.
Nice policy.
Matt,
Matt, I wholeheartedly apologize to you and Bob Z for causing you have to put me in jail, and wasting time that could be well spent improving this already great site for investors to congregate in. I got caught at an emotional moment and could not resist putting Cassandra, et. al, (non shareholders in a company I have been following for over 4 years) in her place. As a plea bargain, I will not respond to her repetitive posts of information and will only contribute in a positive manner to the board. I hope you accept this apology with the honesty and truthfullness that I offer it to you.
And, for time served...