Mobile Music, Customer Value, and Changing Market Needs

The music business is under considerable pressure for change due to digital distribution and the synergies between music services and other Internet-based products. The evolution of the old and the new emerging business models in the music industry has come into focus with the emergence of the digital distribution of music services, as described by Vaccaro and Cohn (2004) for example. Based on the same observations, Fox and Wrenn (2001) suggested new business and revenue models for music companies. To cope with the new situation, strategic alliances are being established among and between wireless infrastructure firms, operators, and product providers. Vlachos, Vrechopoulos, and Doukidis (2003) discussed a set of strategic marketing implications for product providers and mobile operators engaged in mobile music distribution. Relating to strategic considerations, and against the background of these changes to the music industry, this article explores a set of issues of strategic importance in mobile music distribution: the role of the mobile phone as an emerging “entertainment center” for progressive user segments, the increased personalization of services, and the role of various models of payment for digital (including mobile) music. Hence, the study takes as its starting point the implications of changing customer demand for mobile music services. On the basis of exploratory studies of consumer attitudes toward the digital distribution of music in general, and with a particular focus on the new territory of mobile music distribution, a set of propositions is generated and discussed.