"WHAT WE HAVE HERE IS A FAILURE TO COMMUNICATE"
Famed Italian composer and violinist Corelli (1653-1713), once elicited the following words of praise, from a musicologist and fan, "your music is the bread of life". Generalizing from there, if music is indeed the bread of life, these are indeed times of plenty online.
In the last few years and months, there's been a bounty of legal music available online, starting of course with the a la carte services of Apple iTunes, followed by the subscription, "all you can eat" services of Napster and Real's Rhapsody. Microsoft is also circling the business with its MSN Music service...and AOL's been in the game for a while as well.
As expected for weeks, Yahoo! officially announced its unlimited music service offering today, and they are sure to cause reverberations amongst the existing and any impending players.
As this Yahoo! comparison table indicates, its unlimited service is meaningfully less expensive than the competitors, coming in at around $7/month vs. about $15/month for the competitors. In addition, downloaded, burnable tracks are $0.79 vs. the industry "standard" $0.99 at iTunes and elsewhere.
This is all terrific for consumers, and Yahoo! is to be commended for shaking things up and taking them up a notch.
However, this post is one of "tough love" for all the music services. I've been a long-time fan of Yahoo!, Real, Napster, and iTunes, and am a subscriber to all their three subscription services.
To repeat the sub-title to this post, in the case of all three services, "What we have here is a failure to communicate" (famous line from the movie "Cool Hand Luke", 1967), in this case with existing customers.
Let me explain...when I was growing up in the middle east, one of my tasks before many evening family meals, was to go and buy fresh, hot Arabic bread, or Khubz, available fresh and hot everyday from corner-store bakeries.
For most households, it's cheaper and more convenient, to buy fresh, hot bread before every meal, than to make it at home.
These bakeries were ubiquitous, and every few weeks, they'd get in a spirited round of pricing competition.
One store would announce a special, and then of course, all the others in the surrounding area, would immediately respond. The customer always knew where they stood, going into any of the bakeries, because there'd be someone outside the store advertising the new price, or price in response to the store next door.
I guess this experience has spoiled me for life. After seeing the Yahoo! announcement early this morning, I logged into Yahoo! music,which took me to my Yahoo! LaunchPlus subscription. LaunchPlus, before today's announcement was Yahoo!'s primary music subscription offering for premium Internet radio offerings.
Well, on the main page, was a promotional link for the new unlimited offering, but NO SPECIAL ANNOUNCEMENT FOR EXISTING SUBSCRIPTION CUSTOMERS on how this service compared/contrasted/differed from the one they were already paying for. There was nothing like:
Welcome, LaunchPlus customer! We have some exciting news today, expanding the music offerings from Yahoo! We are now offering Unlimited Music subscription to over 1 million tracks for only $6.99/month, or $5.99/month, if you pay it annually.
As an existing LaunchPlus customer, you are currently paying xx/month. This new offering adds "xxxxx" and "yyyy" capabilities to your existing service.
OR BETTER
As an existing LaunchPlus customer, you've been paying xx/month. In appreciation for your existing patronage, we'd like to offer you the new service at a discount of Y% from the standard price.
Instead, nothing, Nada. Just a promotional link and the usual Yada, Yada about "exclusive" music premiers, leaving the paying customer to fend for themselves.
By the way, the reason I list Yahoo! LaunchPlus at xx/month, is I couldn't remember and couldn't easily find what I'm paying for the service already.
Yahoo! Music Help, and FAQs don't address pricing or even LaunchPlus in a clear and understandable manner. And certainly, there's no explanation on how any of this compares with the new offering, so the EXISTING CUSTOMER can make a rational decision.
Now, to be fair, I know the Yahoo! folks have had a lot on their plate getting this service ready for tens, if not hundreds of millions of Yahoo! users worldwide. It's easy to forget some details. But forgetting existing customers, especially when they number in the millions, is not a good thing.
It's ironic especially since a recent Yahoo! acquisition Flickr, an online photo-tagging/sharing service I've talked a lot about, handled a similar situation very differently. When it finally raised pricing after coming out of Beta status, it classily acknowledged existing customers by thanking them for their early patronage, and gave them an additional year of subscription for being early and taking a chance on a new and experimental service.
You can see the results in Flickr's official customer discussion forum, with users praising the company. Oh, did I mention Flickr has a customer discussion forum as well?
Yahoo! Music Customer forums? What, you think we're Flickr*?
Yahoo! Music should take a page from the Flickr playbook.
Real's Rhapsody and Napster also have the same issue of responding to a bold, loud, new entrant, that they know all their customers are or will be aware of pretty much immediately. I know it costs them revenue, and maybe for that reason, they don't even acknowledge a lower price on their home pages. But at least send an email to existing customers telling them how they're responding or thank customers for being customers.
I checked my email today...the silence is deafening...NOTHING from Apple, Real, or Napster. Oh, sorry, Real Rhapsody did send me an email wanting me to listen to the new track from 'Nelly, Weezer, and more".
But nothing on the big elephant in the cyber-room.
If they're not responding, just a word of thanks for existing patronage, makes a customer feel good. I know I'm wondering what I'm going to do with my other subscriptions...and I'm sure I'm not alone.
Also, given that services like Yahoo! have historically depended on lower-cost email support as their primary line of defense, there is no 1-800 phone or even toll number to call for help. It makes the customer even more frustrated and disenchanted with the service. Apple iTunes also has the same problem, with no phone support. I know it's expensive, but there are times when it helps to talk to someone, even if it's an Indian in a call center in Bangalore.
By the way, despite all the criticism on this site and others on internet telephony provider Vonage's customer service, the one place I have to give them kudos is how quickly they responded to pricing changes from incumbent telephone companies in recent months. At almost every instance, I got an email announcing that Vonage was reducing their price, and that it would automatically be taken care of in the billing. They re-assured the customer that they didn't have to do a thing, and made them feel good for being a Vonage customer at the same time.
Online customer acquisition and retention is one of the killer cost items in the online business. Subscription based businesses like AOL, Earthlink, Netflix, XM/Sirius and others have always understood that.
Internet companies that have flourished first with high-margin advertising-driven companies, do not seem to have internalized these lessons into their DNA. As they move into subscription services, there is a greater need to pay greater to subscription customer acquisition and retention. Google has yet to learn this lesson as it moves presumably into subscription services over time. Skype is also likely learning these lessons as it introduces its subscription services as well.
To Yahoo!'s credit, they allowed me an option to cancel my LaunchPlus service online. This is in contrast to most subscription driven businesses that make you jump through hoops to do the same.
At the same time, it was too easy. In my current frustrated/uninformed state, I canceled my LaunchPlus account, and then subscribed to the new Unlimited service. I don't know how much I saved on the LaunchPlus side, and I also don't know what incremental services I lost by doing so...there simply was no easy way to figure all this out on Yahoo!'s pages, that I could find.
Makes you yearn for the simple days of figuring out who to buy your daily bread from...
P.S. After subscribing to the Yahoo! unlimited offering, and downloading the software, I got an icon on my desktop that says "Yahoo! Music Engine"...huh? When you launch it, you get a program that announces it's Beta...surprise number two.
For a customer that thought they just subscribed to a premium music service, there's nothing that indicates how to access that service, just this "engine" thing. I know my mom's would be flummoxed by that.
So another thing on Yahoo!'s to-do list...they need to clarify the branding of all their music services.
Is the new service Yahoo! Unlimited Music, or Yahoo! Music Engine?
And how does this all relate to Yahoo! Launch and Yahoo! LaunchPlus? Very, confusing indeed.
P.S.S.
* "you think we're Flickr?" refers to recent, clever Hertz Ads.
P.S.S.S. Here's a hip, pithy rundown of the new Yahoo! service from Ian Rogers, one of the folks at Yahoo! responsible for the launch (via Fred Wilson). Ian is asked the question I raised about the relationship of the new service to the old Launchplus service from another reader. The exchange is as follows:
Ian, I have a question I was hoping you could answer.
I currently subscribe to launchCAST, I pay monthly (3.99). I really love launchCAST because of the music it introduces me to. I am interested on having the music on demand benefits of Yahoo Music Unlimited, but would never want to give up my launchCAST station with the recommendations. My question to you is (because I have not found a straight answer anywhere else): If I sign up for Yahoo Music Unlimited, can I still play my launchCAST station? It seems like the YME has the Unlimited Service and the launchCAST service built in, but they don't overlap in anyway. Could you please shed some light on the link between Unlimited and launchCAST for me? I would greatly appreciate it.
-markWednesday, May 11, 2005 - 10:28am (PDT)
Hi Mark. Absolutely. Premium LAUNCHcast comes with the cost of the subscription service. So how's that for a deal? Only $2/month more (if you buy a year up-front) and you get on-demand, too!
Cris, sorry. The app is available world wide, the Yahoo! Music Unlimted stuff is only available in the US currently due to licensing issues. Will get it to you ASAP.
ianWednesday, May 11, 2005 - 10:33am (PDT)
Thanks Ian...that wasn't too hard...
but customers shouldn't have to work this hard to figure out the answers...they should put up this exchange on the main Yahoo! music page, so other existing customers don't have to flounder around for a clear answer.
I believe it means I made the right decision...canceling my LaunchPlus subscription for the new, annual Yahoo! Music Unlimited (aka Yahoo! Music Engine, after installation).
Now, I think I signed up for the ANNUAL Yahoo! Launchplus subscription...
Next thing to figure out: I wonder if I'll get pro-rated only for the few weeks I was subscribed to Yahoo! Launchplus since I took the annual subscription, and the rest re-funded...guess, I'll have to wait for another post from Ian.
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