"Pay Music" Analogy to "Pay TV" Wrong?

The natural analogy for streaming music services, or Sirius XM, for that matter, is that streaming music or Sirius XM is to radio as cable TV is to TV. By that analogy, consumers will prefer the new programming choices the new services offer, in comparison to broadcast radio. But some question whether the analogy is apt. 

“There is a natural ceiling of adoption of the people who are willing to pay $9.99 a month for music they don’t own," says industry analyst Mark Mulligan. 

And that might be a key difference. People never experienced TV as something they owned. TV always was "streamed" or "broadcast." Radio, on the other hand, was a one way people consumed music, the other key mode being packaged prerecorded media (records, then tapes, then CDs, then MP3s). 

Though there was a period in the 1980s and 1990s when it seemed people had significant desire to "own" copies of favorite movies as they were used to owning copies of their favorite songs, that habit has not proven to be a sustained major trend, as sales of DVDs are declining, while sales of Blu-ray discs are not growing fast enough to replace lost DVD sales. 

To be sure, the DVD rental business, and the newer streaming delivery of movie or TV content, is succeeding in a way that the earlier "pay per view" business did not achieve. 

In other words, for historical reasons, people might view the logical consumption modes for TV and music in different ways. To be sure, many skeptics once believed that people would not pay for TV, either. Those skeptics were proved wrong. 

Perhaps the same consumer reluctance will be overcome, and streaming music services will indeed become the "equivalent to cable TV for the radio business." 

"It’s a niche proposition," says Mulligan. "The majority of mass-market consumers are still not interested in that pricepoint.”