2004-03-05 06:31 Źródło: Warsaw Business Journal
The sound of things to come
Wrocław-based iPlay, a small company controlled by venture capital fund MCI Management, intends to launch a new service by the end of April allowing users to legally download music files over the Internet.
But the pioneer on the local market is facing significant obstacles.
The Internet market has been the fastest growing segment of the music business globally ever since Apple launched its iTunes service in the USA two years ago. The American market now includes several important players with the re-launched Napster, which now charges for downloads, and iTunes gearing up for the expected assault by Microsoft. All these firms are expected to make forays into Europe in the near future. Can a small local firm fend off the global competitors when they do come to this country?
The library of songs on offer by iPlay is now limited to fewer than five thousand files, though the company does plan to have between 10,000 and 20,000 by the time the service is launched.
"We are currently in negotiations with the 'Big Five' music firms in the country, as well as with dozens of independent international companies," says Dariusz Szladowski, president of iPlay, "But the recording companies' skepticism is the biggest barrier to entry onto the market."
The talks have been going on for more than a year and Szladowski expects to close most of the deals currently under negotiation within two to three weeks, but the 'Big Five' have good reason to be wary of Poland's first Internet service.
"We cannot disclose any details of the ongoing negotiations," said Universal Music, the country's largest music firm, through a spokesperson, "But we have plans to launch sales of MP3 music files by year-end." The service would be launched in partnership with several other large music companies in an analogy to the Large Distribution House (DDD), a music warehouse owned jointly by Universal Music, Pomaton EMI and Sony Music.
Szladowski says the company depends on the 'Big Five' (the above three plus BMG and Warner Music) for most of the music on offer on its Internet service - hardly a desirable situation, considering that they are also its prospective competitors. What is more, market insiders are confident that the arrival of the global market leaders in this country is also imminent.
"We realize that the market will be increasingly competitive," Szladowski says, "But we have developed several features that will clearly distinguish us from the competition."
It is difficult to tell if this will prove sufficient to successfully compete with iTunes, one of the few Internet success stories of recent months. The local player's success could well depend on its ability to carve out a niche on the market by offering music by local, rather than global, artists.
Aleksander Nowacki
But the pioneer on the local market is facing significant obstacles.
The Internet market has been the fastest growing segment of the music business globally ever since Apple launched its iTunes service in the USA two years ago. The American market now includes several important players with the re-launched Napster, which now charges for downloads, and iTunes gearing up for the expected assault by Microsoft. All these firms are expected to make forays into Europe in the near future. Can a small local firm fend off the global competitors when they do come to this country?
The library of songs on offer by iPlay is now limited to fewer than five thousand files, though the company does plan to have between 10,000 and 20,000 by the time the service is launched.
"We are currently in negotiations with the 'Big Five' music firms in the country, as well as with dozens of independent international companies," says Dariusz Szladowski, president of iPlay, "But the recording companies' skepticism is the biggest barrier to entry onto the market."
The talks have been going on for more than a year and Szladowski expects to close most of the deals currently under negotiation within two to three weeks, but the 'Big Five' have good reason to be wary of Poland's first Internet service.
"We cannot disclose any details of the ongoing negotiations," said Universal Music, the country's largest music firm, through a spokesperson, "But we have plans to launch sales of MP3 music files by year-end." The service would be launched in partnership with several other large music companies in an analogy to the Large Distribution House (DDD), a music warehouse owned jointly by Universal Music, Pomaton EMI and Sony Music.
Szladowski says the company depends on the 'Big Five' (the above three plus BMG and Warner Music) for most of the music on offer on its Internet service - hardly a desirable situation, considering that they are also its prospective competitors. What is more, market insiders are confident that the arrival of the global market leaders in this country is also imminent.
"We realize that the market will be increasingly competitive," Szladowski says, "But we have developed several features that will clearly distinguish us from the competition."
It is difficult to tell if this will prove sufficient to successfully compete with iTunes, one of the few Internet success stories of recent months. The local player's success could well depend on its ability to carve out a niche on the market by offering music by local, rather than global, artists.
Aleksander Nowacki
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