Moontaxi strikes deals with Standard, Universal in move to offer downloads

One of Canada’s pioneering music subscription services is preparing to go into the new year with an important strategic alliance and new business deal with the Universal Music Group ready in its arsenal. Moontaxi Media, which launched its subscription service in November, has recently signed a deal with Universal to be its download affiliate in Canada and is preparing a marketing blitz for 2003 with new partner Standard Radio Inc. Moontaxi has launched a $5.95 per month subscription music site as co-CEO Alistair Mitchell told Canadian NEW MEDIA last February the company would do (CNM, Feb. 22/02). At the time, Mitchell was guarded about the premium services the company would offer and the relationships it was forming with the big record labels. In the intervening time, Moontaxi has struck a deal with Universal to be the record label’s designated download provider, providing the technological infrastructure to provide downloads with digital rights management attached through both the Moontaxi site and third-party online retailers and radio station web sites. "The fine-tuning of what exact abilities you’ll have with that download have yet to be finalized," Mitchell tells CNM. "But the basics of it are that consumers are demanding and should receive something that allows them to port it (to devices such as MP3 players) and burn it (to compact discs). Those are the two key pieces." Moontaxi joins another service, Bell Sympatico’s MusicMatch, as recent entrants to the Canadian online music subscription landscape (CNM, Oct. 3/02). The ability to download, and to create up to three customized playlists of up to 100 tunes, says Mitchell, sets Moontaxi apart. He says the approach was developed through extensive consumer research. "We spoke to a thousand Canadians through a telephone survey and asked them a whole battery of questions. That has helped us develop the solution that we’re developing to meet their needs. It also gives us a very strong indication that there is a demand for downloads that are licensed downloads and that provide an element of quality and convenience that’s not available through free, illegal download sites," he notes. One key differentiator should be the ability to burn albums and tracks, though the technology to do so with effective rights management has been a bugbear of the industry as a whole. The competing MusicMatch service, for instance, restricts the playing of downloads to the users’ PCs. Asked if Moontaxi believes re-distribution of downloads can be controlled, Mitchell says they can. "That’ll be the call of the copyright owners, but generally speaking there is a feeling that the purchaser of the downloads should have the ability to burn the downloads and port that download to other devices." MusicMatch offers downloads, though they must be played on proprietary software resident on the user’s computer. Other services such as U.S.-based MusicNet and PressPlay have come under fire for similarly restricting how users may play their choices. Moontaxi maintains its 100 channels of free, pre-programmed music with banner advertising, which will remain an important part of the company’s revenue mix. "We see download revenues as the biggest three years out, and we see advertising and subscription revenue probably neck and neck behind that," Mitchell says. He says covering all three parts of the music spectrum is important. "One at the radio end where we provide pre-programmed music channels. One in the middle of that spectrum where we give you the ability to customize your radio channels, and the other end of the spectrum – the ability to actually get on-demand access to that music." Mitchell also says the company should enjoy a domestic advantage. "I want to reinforce the fact that we are Canadian, made-in-Canada, homegrown. We are the best to respond, we argue, to Canadian needs."

Moontaxi strikes deals with Standard, Universal in move to offer downloads

Broadcast | December 20, 2002

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