Celestial jukebox is here

Finally. Unlike Microsoft’s crippled Zune, the SanDisk Sansa Connect lets you connect to any open Wi-Fi network, and lets you download unlimited music from Yahoo’s subscription Unlimited To Go service, which is $15 a month or $12 a month if you buy a year in advance. You can also listen to Yahoo’s LaunchCast radio service for free.

Sounds like there might still be a few bugs to work out with the software syncing–apparently, it doesn’t sync downloads very well–and it’s only 4GB, which is too small for folks with large local music libraries (like me), but the fact that you can now have access to 2 million songs anytime, anywhere, is a significant change. And it looks like they beat a similar iRiver/Rhapsody device to market.

If Microsoft had launched Zune with this feature, it would have gotten way more attention. Now they’re going to be playing catch up.

Of course, Apple might be right–it might turn out that consumers want to own their music and aren’t interested in subscription services like this. But at least the choice is now out there.

The suits talk DRM

Two interesting posts from AppScout about panel discussions on DRM at the Digital Music Forum in New York City last month. In the first, a group of execs from Sony BMG, Real/Rhapsody, and several small online music distributors argue that DRM is necessary, that Steve Jobs was blowing smoke, and that if Pixar/Disney started selling its content without DRM, everybody would sell the stock on the presumption that piracy would render its business unsustainable. Fortunately, one guy from digital distributor The Orchard pointed out that DRM doesn’t work to prevent piracy anyway, but only prevents average consumers from doing things they might want to do, such as transfer an iTunes download to a non-iPod device.

The second discussion sounded a bit more interesting, with some industry folks admitting that eliminating DRM would actually benefit them financially, and a long discussion of my favorite topic, the celestial jukebox.

Wireless Rhapsody

One of my long-awaited desires, the celestial jukebox, is arriving in 2007, courtesy of RealNetworks and a handful of partners like iRiver, Samsung, and Nokia. Not only can these forthcoming iRiver players download subscription-based Rhapsody content over the air via Wi-Fi, but they also have other cool stuff built in like voice and line-in recording.

Why couldn’t Microsoft have done this with Zune? They better get cracking, the competition’s moving faster.

The future of Zune?

One of the big knocks against Microsoft’s Zune player is that songs you beam to one another wirelessly expire after three days or three plays.

But now it appears like this is just the first step. A recent Microsoft Research paper proposes a new business model in which end-users are distributors. The idea is I could beam (“squirt” in Microsoftese) a song (or eventually video) to you and if you like it, you agree to buy it and the DRM goes away. Zune keeps track of every transaction and compensates the content owners after the fact. Most interesting, the seller gets a few MS Points as commission. This gets around the whole “DRM sucks” problem—instead of telling people not to share and relying on flawed technology to prevent it, they offer incentives to share. Apparently MS is getting patents in place and J Allard has talked about this publicly a few times.

Fantastic idea. Instead of trying to stop natural human behavior, capitalize on it. It’s certainly better than clutching the anchor as the ship goes down.

Microsoft to pay Zune spiffs to Universal

This seemingly innocuous agreement, under which Microsoft pays a fe dollars to Universal Music Group (one of the Big Four record companies) every time it sells one of its ZUne portable media devices, could actually grow into something really groundbreaking and important.

The music industry’s current approach is a dead end. DRM is fundamentally flawed technically (there’s no third-party attacker–you must eventually present the content to the person you’re trying to protect it against) and from a business perspective (users pay more to get less). File-sharing is gradually gaining more legal protection everywhere but the United States (which is irrelevant given the global scope of the Internet). CD retailers are going out of business. Consumers are learning to hate the record companies, who sue them and try to take over their computers with malicious software.

Many observers, myself included, believe that the better way forward for the music industry is a pooled-payment system for digital distribution. Add a few bucks added to the sale price of every digital media app or device, and perhaps even to monthly ISP bills. Then, some sort of tracking system could track how many times particular files are uploaded, duplicated, played, etc., and payments disbursed accordingly. Shawn Fanning (Napster founder) is trying to build a business based around this idea but hasn’t had many takers yet.

Microsoft is going ahead and doing it anyway with Zune. Short run, this gives UMG a stake in Zune’s success, and could get them to agree to steps such as eliminating the “3 days, 3 plays restriction” for Zune-to-Zune transfer, allowing Zune-PC-Xbox transfers, enabling the rumored “DJ mode” (broadcast to Zunes within range), subscription-based anytime-anywhere wireless access to millions of songs (the music lover’s dream), and so on.

Long run, if everybody follows suit, this could create a much friendlier world for digital music–consumers aren’t burdened by arbitrary and annoying restrictions, content owners get some compensation instead of nothing (as is the case with piracy).

Top ten Zune features I want

So I was one of the lucky dozen or so who got a preview of Microsoft’s forthcoming Zune portable media player and store last week. (Through my job, not as a blogger, although I met a few cool ones at the event.)

Quick takeaways:

• The design was cool, very approachable and fun but not cheap feeling or plastic like some players. I liked it much better than the Xbox 360, which I got a similar preview of way ahead of time. My first thought with Zune was “oh, I’d be happy to be seen with one of those.” My first thought with the 360 was “it looks like a small desktop PC.”
• The UI takes some getting used to if you haven’t used a Portable Media Center or the Media Center UI in Vista. It’s got double menus–the veritcal menu we all know and love from the iPod (like a list of songs in a playlist, or albums by a particlar artist), as well as a horizontal one across the top that changes contextually (so if you’re looking within one playlist, the top menu lets you quickly get to other playlists). Very cool because it lets you get to stuff more quickly.
• The Zune-to-Zune wireless sharing capability is great. The 3 days, 3 plays restriction imposed by the record companies is lame. And from what I understand about Windows Media DRM, Microsoft could have discerned downloaded from ripped content….that’s not the issue. The issue is the record companies don’t want me flashing you my entire ripped library, even if some of those songs are partly my own creations.
• I didn’t get to test the software, which is make or break. If it doesn’t find files on my hard drive adequately, doesn’t sync with the device perfectly every time, puts lame restrictions on my downloads from the store, or is otherwise broken or buggy, then Microsoft has no chance with this thing.

So what’s missing? A few things. Part of this is purposeful–Microsoft wanted to start by making a great music player, just like they launched the first Xbox as a great game machine. And just like you saw that Ethernet connector on the Xbox and knew they had some big stuff in store for online connectivity, so you see the Wi-Fi transceiver in Zune and can imagine big things here.

Anyway, here’s the 10 things I hope they add.

1. The “DJ” mode that was reported in Toshiba’s filing with the FCC. (Toshiba’s the first manufacturing partner, but there’ll be others.) This will allow you to stream your music to four other Zunes within range, live.

2. Buddylist capabilities in the Zune software, so I can recommend songs to my Windows Live Messenger friends and stream full songs to them. The record companies would have to like this–what a great way to publicize their wares.

3. Download simple games from Xbox Live Marketplace to my Xbox 360, then transfer them to my Zune.

4. Wireless sync. When I walk into the room with my PC on it, I want Zune to find the PC, connect to it, and upload any changes from the Zune software (which would have to be left running in the background all the time; iTunes does something like this.)

5. Sync with my Xbox 360. I’ve got a video trailer on my 360, I want to put it on my Zune.

6. A camera attachment. Nothing special, just like what cellphones come with today.

7. The entire Beatles catalog in the Zune Marketplace. Come on, I know their terms are ridiculous, but if Microsoft can’t afford it…and what better way to differentiate yourself immediately from every other player on the market? Add Radiohead while you’re at it.

8. A Zune client for my phone, so I can sync my library between PC and phone as easily as I do between PC and Zune. Apple lets you sync to multiple devices, so Zune should as well.

9. A recording attachment so I can make decent digital recordings of the world around me. Band rehearsals. Club shows. Snippets of conversation for later use as samples. I know the record industry might freak at this one–people will record and trade bootlegs!–but it’s just as easy to sneak a handheld digital recorder into a show as it would be to sneak in a Zune. I’m not talking super-high-quality recordings anyway, just decent enough to let you hear what was happening. Then upload them to the PC, send to your friends, whatever. Plus, look what bootlegging did for the Grateful Dead.

10. The big one: the celestial jukebox in the sky. Pay a monthly subscription. Connect to any Wi-Fi hotspot. Download or stream any music in the Zune catalog, any time. People have been clamoring for this for some time now. Music fanatics would pay big bucks for it. Sure, Microsoft would have to address user experience issues like finding a Wi Fi hotspot, but somebody, someday is going to do this and Microsoft’s first to market with a Wi-Fi-enabled device, so why let anybody else get there first? It’s all up to the content owners–pick a price, start testing the market!