AOL-Music Now is Dead!

“AOL has named Napster exclusive supplier of subscription music for its AOL Music site, and plans to migrate all 350,000 paid accounts away from the existing service, AOL Music Now, over the next 60 days.”

“Unless they opt out of the move, existing Music Now customers will be able to use the Napster service for the same fee they pay now, and their existing login and payment details and any prepaid credits will be retained, AOL said.”

This reinforce the idea, backed by David Caulton that online music provider needs to be linked with exclusive mp3 player. The real money seems to be coming from selling the hardware and not the music itself. Standalone online music websites may be facing a challenge that can’t be overcome as we know it right now. This may be a part of the reason why Universal did everything they could to get a royalty on every Zune sold and are also planning to go after the iPod. The news came only a week after the Virgin Digital announced the merge of their service with Napster

I will bet the music industry will find a few tricks to sell us music online and make profit with it. Music downloading will become easier to operate when the music industry decides to centralized the music and let online music store access it only through webservices. The large scale economy will make the model viable from there.The consolidation phase that is going on the market right now may be the beginning of it

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