Sony Corp (NYSE: SNE) likes a good fight and that’s just what they’re going to get. Just 24 hours after Apple Inc. (NASDAQ: APPL) unveiled their new iTunes software, Sony announced a new streaming digital music service of their own. But whether Sony can compete with iTunes won’t be as quickly decided.
Sony’s Music Unlimited will allow users to stream music over Sony TVs, Playstation 3 and Playstation Portable game consoles, Blu-ray disc players, and a variety of other Internet-connected devices made by the company. While Sony is looking to make Music Unlimited a direct competitor with iTunes, it differs significantly from Apple’s service by doing away with purchases of data, opting instead for a purely streaming model similar to CBS Corp.(NYSE: CBS) at its Last.fm. Sony Europe president Fujiro Nishida boasted that Music Unlimited users will have “no need to manage their music files.” Considering the digital music marketplace, of which Apple controls 70% of sales according to NPD Group, Nishida’s words sound like sour grapes.
Sony has every right to be bitter about the music business. Twenty-five years ago, the Japanese technology giant changed the landscape of music sales with their line of portable music players, beginning with their affordable boom boxes in the 1970s. Sony’s true legacy in the music industry begins with their portable cassette player, the Walkman, a brand name that became synonymous with portable music players of all kinds for years. The device fueled music sales in a way the industry had never experienced, a success Sony magnified in the 1990s as their physical media creation, compact discs, overtook cassettes as the music medium of choice. Their Discman portable CD players were also hugely popular. Come the turn of the century, though, Sony began to falter as music began its sudden transition into the digital age. Rather than recognize the potential in players of MP3 and WAV music files, Sony instead clung to physical media. Meanwhile, Apple took over the portable music player market with their line of iPod devices, whose brand ubiquity replaced Sony’s within a few years.
Music Unlimited may have been a viable competitor in the digital music space had it be announced in 2005, but in 2010 it seems like Sony is begging for table scraps. The streaming music service comes off not as a product of the company that’s created massive entertainment successes like the Playstation 2 game console, and more like the company who has foolishly poured millions in the development of failed proprietary technologies like UMD discs and, potentially, Blu-ray discs. Sony should face facts: they lost the music war of the early 21st century.
Best to focus on getting more people to buy HD televisions and game consoles than try to get just a handful of them to use a music service that doesn’t have a lowercase “i” in its name.
As of this writing, Anthony Agnello did not own a position in any of the stocks named here.
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