Nokia to Share Revenue of Bundled Music With Mobile Operators
Jan. 27 (Bloomberg) -- Nokia Oyj, the world's biggest maker of mobile phones, will share revenue with phone operators from a program to sell handsets with unlimited music access, Nokia's head of entertainment said.
``In those cases where we cooperate with operators, there will be an arrangement so they can get a piece,'' said Tero Ojanpera, an executive vice president and a member of Nokia's executive board, in an interview today in Cannes, France.
The Finnish company unveiled in December the ``Comes With Music'' program, which will allow customers to buy a phone with a year of unlimited access to millions of tracks included in the purchase price. Nokia agreed to offer tracks from Vivendi SA's Universal Music Group, and is in talks with other major labels.
Mobile-phone service providers including Vodafone Group Plc and France Telecom SA's Orange sell music downloads to subscribers to help lift average revenue per user. Nokia's shift into services has caused concern among phone companies about how revenue is spread among the players.
``A lot of phone companies have been doing some phones with music, but they have not been revenue drivers for the music industry,'' said Ojanpera, who spoke at the Midem music industry meeting in Cannes.
``Selling mobile music in a big way does not exist today,'' Ojanpera said. ``Music has been used more as a marketing tool. Creating a new business that will be, in years to come, billions of dollars is something completely different,'' he said.
Tracks downloaded on the ``Comes with Music'' program will be protected by digital-rights management software, Ojanpera said. While users will be able to share music files between their handset and computer, the files will not be transferable between computers, according to the executive.
DRM
Universal Music Group, Nokia's partner, supports such copy- limiting technology, known as DRM.
``Our policy is still that we are still strongly attached to DRM especially for advertising-based models and subscription- based models,'' Vivendi Chief Executive Officer Jean-Bernard Levy said at Midem yesterday.
Ojanpera declined to say what the cost of the phone and music bundle will be, or what other labels have agreed to make their music available for ``Comes with Music.''
The Nokia executive said the service won't be available on existing phones.
``This is something new,'' Ojanpera said. ``You actually buy a device that is complete. You can't buy the same device without the content.''
``In those cases where we cooperate with operators, there will be an arrangement so they can get a piece,'' said Tero Ojanpera, an executive vice president and a member of Nokia's executive board, in an interview today in Cannes, France.
The Finnish company unveiled in December the ``Comes With Music'' program, which will allow customers to buy a phone with a year of unlimited access to millions of tracks included in the purchase price. Nokia agreed to offer tracks from Vivendi SA's Universal Music Group, and is in talks with other major labels.
Mobile-phone service providers including Vodafone Group Plc and France Telecom SA's Orange sell music downloads to subscribers to help lift average revenue per user. Nokia's shift into services has caused concern among phone companies about how revenue is spread among the players.
``A lot of phone companies have been doing some phones with music, but they have not been revenue drivers for the music industry,'' said Ojanpera, who spoke at the Midem music industry meeting in Cannes.
``Selling mobile music in a big way does not exist today,'' Ojanpera said. ``Music has been used more as a marketing tool. Creating a new business that will be, in years to come, billions of dollars is something completely different,'' he said.
Tracks downloaded on the ``Comes with Music'' program will be protected by digital-rights management software, Ojanpera said. While users will be able to share music files between their handset and computer, the files will not be transferable between computers, according to the executive.
DRM
Universal Music Group, Nokia's partner, supports such copy- limiting technology, known as DRM.
``Our policy is still that we are still strongly attached to DRM especially for advertising-based models and subscription- based models,'' Vivendi Chief Executive Officer Jean-Bernard Levy said at Midem yesterday.
Ojanpera declined to say what the cost of the phone and music bundle will be, or what other labels have agreed to make their music available for ``Comes with Music.''
The Nokia executive said the service won't be available on existing phones.
``This is something new,'' Ojanpera said. ``You actually buy a device that is complete. You can't buy the same device without the content.''
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