Free music may cripple Nokia financially

Nokia's "Comes With Music" program, offering those who purchase Nokia phones nearly unlimited free access to a large music database, could cost the company more than it would make. The Register writes that Nokia would be responsible for footing the bill for downloads that exceed the estimated limit of 35 songs per user, charged wholesale per unit. The move reportedly pressured Ed Averdieck, former Managing Director of Nokia Music, to leave his position.

In addition, former head of Nokia Multimedia Tommi Mustonen, was put into a position where he must deal with label negotiations personally. Nokia is currently in the process of working out deals with EMI and Warner Music, as well as several independent labels.

"Comes With Music" is a controversial music purchase plan wherein the subscription cost for the near-unlimited downloads is rolled into the purchase price for phones that are part of program. Nokia hopes this unique approach will help it achieve market dominance ahead of Apple, which announced that iTunes recently passed Walmart as the largest US retailer in legal digital music downloads.

Filed under: audio
Other story tags: Nokia, financial, digital music

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bobolicious

Nokia who...?

04/28, 6:56pm, EDT

...yeah baby, Apple has me because of lossless & I haven't bought a single iTune yet I've filled a large capacity iPod - for me it's not about the tunes, it's about the music... ;-)

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ZinkDifferent

Yeah....

04/28, 9:03pm, EDT

...let me know how that brilliant strategy works out, will you, Nokia?

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WiseWeasel

no problem...

04/28, 9:17pm, EDT

Fortunately for Nokia, only a fraction of a percent of their userbase will even be inclined to use their music store, so they should be fine even if some of those exceed that 35-song threshold...

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climacs

d'oh

04/28, 10:42pm, EDT

yeah that could be a problem, if it succeeds then Nokia could be royally screwed. Can you offload these songs from the phone to a PC? That's what I want to know. If they remain chained to your Nokia phone then it's really not all that useful unless you can drop them into your memory card, I guess. Anyway, I'm not buying a Nokia anytime soon regardless.

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