Music Industry "Goes Open" to Make More Money

One of the odd justapositions out there right now is the recent move by music companies to drop encryption measures (digital rights management) online music sales through Amazon.com as a way of increasing sales. Given the general vested interest in protecting content from copying, this is a bit strange.

Why would music labels voluntarily drop DRM measures that make it harder for users to port their music around? In this case, a move that essentially is more open is a competitive measure. Apple, which uses a DRM format to restrict downloaded music to playback on its own devices, essentially has gotten too much market power in the music business, the studios think.

And in this case, one way to wrest back more control is to stimulate sales of unprotected music through rival retailers such as Amazon.com.

Amazon MP3, the DRM-free music store of Amazon.com, now sells DRM-free MP3s from the four major music labels - EMI, Universal, Warner Music, and Sony BMG - and 33,000 independent labels.

Apple iTunes has more than two-thirds market share of paid online music donwloads.

The top 100 songs at Amazon MP3 come at a price of $0.89 each and most other tracks are offered at a range of $0.89-$0.99, underpricing iTunes titles which are sold for 99 cents a song.

It's a bit unusual to find any industry's leaders pushing a trend towards openness, rather than upstarts. But that's what happens when an upstart becomes too successful in a new line of business. If "open" sells better than "closed," they'll try it, despite an obvious interest in copyright protection that might be furthered by DRM measures.

Of course, the problem with DRM is that it angers legitimate customers as much as it deters piracy. It is a blunt instrument.

MPLS over DSL from New Edge Networks

New Edge Networks will offer its managed network customers in April the ability to tag and prioritize data applications traffic over low-cost, high-speed digital subscriber lines commonly used for wide area networks. The move is a challenge to T1 services that sometimes are alternatives to business-class DSL services, and which can offer tagging and prioritization.

New Edge says it also will support tagging and traffic priorities end-to-end through private networks

Businesses in various industry segments can use up to five classes of service to tag and prioritize their applications so that critical services such as VoIP telephone calls or inventory and price lookups move across DSL-based networks ahead of email or other less important business functions.

Currently, traffic tagging and prioritization with class of service are available only on more costly high-capacity T1 lines with MPLS technology, short for Multi-Protocol Label Switching.

New Edge will honor DSL class-of-service tags end to end throughout its customers’ private wide area networks.

The move means enterprise branch offices and remote locations or smaller businesses that cannot justify a T1 line will be able to buy class of service features at a business DSL price.

A typical DSL connection used as part of a managed, private network costs about $150. Monthly costs for T1 lines range from about $500, depending on distance and geographic area.

Mobile Web: The Browser Matters

On Christmas, traffic to Google from iPhones surged, surpassing incoming traffic from any other type of mobile device, according to internal Google data made available to The New York Times, says staff writer Miguel Helfta. So apparently the design of a mobile phone brower really does stimulate high levels of usage.

The data shows that although iPhone's used to access Google fell back into a more normal range after that, levels of access still were higher than from Symbian mobiles. Keep in mind that Symbian has something like 63 percent of the installed base while iPhone has perhaps two percent.

Yahoo also saysiPhones accounted for a disproportionate amount of its mobile traffic, Helfta notes.

There might more upside for Web application developers. If they can develop for mobile-optimized browsers, rather than for the details of individual devices or operating systems, there arguably is an easier path to ubiquity.

Telcommuting Downside

Telecommuting may boost morale for telecommuters, but it can have the opposite effect on those left behind in the office, according to Professor Timothy Golden, a management professor at Rensselaer Polytechnic Institute.

"Those who do not telecommute are more likely to be dissatisfied with their job and leave the company, says Golden. Golden's research suggests that their co-workers tend to find the workplace less enjoyable, have fewer emotional ties to co-workers and generally feel less obligated to the organization.

About 37 percent of U.S.-based and international companies now offer flexible work arrangements, with the number of those programs growing at a rate of 11 percent per year, according to the Society of Human Resource Management.

With a greater prevalence of telecommuters in a work unit, he said, non-telecommuters find it less personally fulfilling to do their work.

Greater face-to-face contact between co-workers when all employees are in the office and granting greater job autonomy can help, Golden argues.

He studied a sample of 240 professional employees from a medium-sized company.

Consumer Electronics Trumps Other Retail Sales

It doesn't appear to have been a good Christmas selling season, as this graphic by the Wall Street Journal illustrates.

But Best Buy says its December sales were up 1.5 percent over last year, compared to an increase of about seven percent in the 2006 over 2005 comparison. The company says the slower growth rate is due where the post-Thanksgiving week data was recorded. This year, that key week fell into the November numbers, instead of in the December reporting period.

Best Buy affirmed its 2008 guidance, suggested the company really did have stronger sales than it might appear. The contrast in sales might point to the increasing importance of consumer electronics as a component of discretionary spending.

That would accord with increasing broadband and mobile penetration, plus continuing interest in high-definition and flat screen TV displays, gaming, digital audio and even personal computers.

Over the past decade, for example, the percentage of disposable income now going to communications and electronic entertainment goods has been rising in virtually all North American, Far Eastern and European regions.

iGoogle for Mobiles Now Live

If you are the sort of user who uses iGoogle, and you put Real Simple Syndication feeds on the iGoogle page, this is helpful. Also, Google has authored a number of its other applications, including Docs and Spreadsheets, the RSS reader, Picassa, Gmail, Google News and even the basic search function in ways that are compatible with a mobile screen. Very nice.

Business Phone Systems: Still Lots of TDM

After dipping one percent in the previous quarter, enterprise telephony equipment manufacturers saw an 11 percent jump in worldwide sales in the third quarter of 2007 to reach $2.6 billion, according to Infonetics Research. But IP-based phone systems did not get all the growth. In fact, Infonetics researchers say the rate of growth in the legacy time division multiplex segment actually outpaced that of the IP PBX segment.


In fact, hybrid PBX systems account for 64 percent of all PBX and key system line shipments worldwide. Pure IP lines account for 18 percent of shipments while TDM lines represent 17 percent of total.

It looks like lots of buyers still are hedging their bets or have reasons to support TDM systems even as they migrate to IP.