eMusic Launches Big In European Market
eMusic, a concern owned by Dimensional Associates Inc., the private equity arm of hedge fund JDS Capital Management Inc., has launched its digital download service across Europe. EMusic will be the first service to launch in all 25 European Union member nations, and will make a big promotional splash in lucrative markets such as Germany and Britain in a bid to become the top alternative to market leader iTunes, the same distinction it holds in the United States. It is also bringing the first legal downloading service to smaller nations including Malta and Hungary. With about 13 percent share in the United States, the world’s biggest music market, eMusic outpaces well-known brands including Rhapsody, MSN Music, Napster, Yahoo and AOL, but remains a distant second from iTunes’ 60 percent share.
The service differentiates itself as the only one on a large scale delivering songs in the MP3 format, meaning they can be played on any portable music player including the iPod. Apple Computer Inc.’s iTunes can only be used with an iPod. EMusic carries 1.7 million songs from 8,500 independent record labels, including tracks from Johnny Cash, Bob Marley, Franz Ferdinand and Bjork. It appeals to a generally older audience than iTunes and is especially popular with jazz and classical aficionados, who tend to be in the 25-54-year-old age bracket eMusic targets. None of the four major music companies, which are responsible for about three-quarters of the music sold worldwide, has agreed to supply songs to eMusic because of the digital rights protection issue.
eMusic is also planning to launch local-language download services in Germany, France, Italy and Spain in 2007. The European sites will charge a monthly subscription fee that ranges from 8.99 pounds ($16.79), or 12.99 euros, for 40 downloads, to 14.99 pounds, or 20.99 euros, for 90 downloads. Unlike most other subscription services, however, eMusic consumers own the songs they download. Subscribers to many other services lose their libraries if they stop paying the monthly fee.