"There's lots of fragmentation in the digital music space right now," said [Yahoo! Music head Michael] Spiegelman. "Whereas five years ago, it used to be the major portals — us, AOL, MSN, et cetera — now there's lots of competing players out there: iTunes [and] Amazon for consumption; there's YouTube, Pandora and Last.fm, and imeem, and iLike, and all these different services. And because of that, we obviously have a challenge, in that we want to stay really relevant to consumers."

There's an undercurrent of "if you can't beat them, join them" to this strategy. But what's wrong with that?

Consumers want what they want, and Yahoo hopes they'll see the benefit of being able to access the stuff on all of these services from one configurable directory.

"For consumers, there's a challenge. Because if you're a leading-edge person, then you can go out and explore and find what services you like and hook onto whatever's new," Spiegelman explained. "But if you're more mainstream, then you're not spending a lot of your time doing that. So how do you find these services?"

While I don't deny that this will provide something of a traffic boon for the lesser-known sites out there (hey Mike, give a ring if you want to design me a module, if you know what I'm saying), I have to ask if these "more mainstream" users will be wary of the customization and leave the default modules the way they are—at least until Yahoo! Music's next rebranding, which, judging by the timeline its parent company seems to be operating on these days, will probably come sometime in late fall '09.

Yahoo Music Hub Will Tailor Services to Users' Tastes [Listening Post]

While none of the Web companies involved would comment on the judge's decision, a source close to the three sounded like the players on a baseball team after the other side just hit a walk-off home run.

"This wasn't good for us, to say the least," the source said, adding that the judge's order isn't yet final and that the three companies plan to continue fighting.

If the final fee structure looks anything like what is prescribed in the judge's written opinion, RealNetworks, Yahoo, and AOL would likely have to raise prices. It may also mean that the cost of doing business for anyone streaming music over the Web just went up.

"What this means to other licensees is, they now see what a standard benchmark fee should look like," [ASCAP CEO John] LoFrumento said. "They now know what to expect from the rate court."

Somehow no online-music services announced that they'd be closing today, but I guess part of that is because the fees were retroactive to 2002 so they'd be in for paying up anyway.
What the ASCAP decision means for consumers [news.com]
Court Sets Royalty Fees To Be Paid To ASCAP [WSJ]

Yahoo! Music is the #1 Music site on the Web, with tens of millions of monthly visitors...But the ENTIRE subscription music market (including Rhapsody, Napster, and Yahoo!) is in the low millions...even after years of marketing by all three companies. When you compare the experiences on Yahoo! Music, the order of magnitude difference in opportunity shouldn't be a surprise: Want radio? No problem. Click play, get radio. Want video? Awesome. Click play, get video. Want a track on-demand? Oh have we got a deal for you! If you're on Windows XP or Vista, and you're in North America, just download this 20MB application, go through these seven install screens, reboot your computer, go through these five setup screens, these six credit card screens, give us $160 dollars and POW! Now you can hear that song you wanted to hear...if you're still with us. Yahoo! didn't want to go through all these steps. The licensing dictated it. It's a slippery slope from "a little control" to consumer unfriendliness and non-Web-scale products and services.

And surely any new all-in subscription service would be the product of a lot of executive bickering, licensing nightmares, and general customer unfriendliness. Even the players who are just entering the subscription game now are pretty much offering more of the same, with Windows-only compatibility and protected Windows Media Player files that cost extra if a user wants to make them portable. If any innovation is going to go on in the subscription-music space, it had better happen quickly, and had better involve a radical rethinking of the current model—especially since a certain digital-music service that launched last month, which allows users to own their music in under 10 minutes (and with no rebooting):

But now, eight years later, Amazon's finally done what was clearly the right solution in 1999. Music in the format that people actually want it in, with a Web-based experience that's simple and works with any device. I bought tracks from Amazon (Kevin Drew and No Age), downloaded them, sync'd them to my new iPod Nano, and had them playing in my home audio system (Control 4) in less than five minutes. PRAISE JESUS. It only took 8 years.

Considering that Yahoo's experimentations with MP3 were just as clunky and unfriendly to customers as the subscription offerings, Rogers' hailing of higher powers is probably 100% sincere.

Yahoo's Ian Rogers To Music Industry: "Inconvenience Doesn't Scale" [TechCrunch; HT therichgirlsareweeping]