Published in The Music Network
Rob Lewis’ head is in the cloud. In the constantly evolving digital marketplace, the cloud is a once mythical place where consumers can access all the music in the world wherever they are. Lewis’ UK-based Omnifone has helped make that concept a reality. After more than six years in business, Omnifone is now recognised as a leading provider of cloud-based digital content services to blue-chip consumer electronics firms. Omnifone is behind the all-you-can eat Music Station, which was named Best Mobile Music Service at the 2008 Global Mobile awards. The previous year, Lewis signed all four major labels to international licensing deals for its unlimited music offerings. Now Omnifone is on the expansion trail. TMN caught up with the tech exec, who will speak at the Music Matters conference in Hong Kong on May 26th-28th.
Mobile music has been slow to take off in Australia, but over-the-wire digital music is soaring. What’s stunting mobile music here?
If you want to get consumers to adopt mobile music on a mass-market scale, you have to make sure you create a service people really enjoy. A lot of the user experiences that were brought to the market in the early days were not that great. A lot of the platforms coming out now – particularly the Android devices – will enable a much better user experience to be delivered on mobile and will take an immense market share in a very short period of time. You have about 22 million mobile subscribers in Australia, and just over five million broadband households. There’s huge opportunity out there. But if the user experience is anything other than brilliant, then adoption will always be low.
So what do mobile consumers want?
The strongest growth factor over the next 12-24 months will see the major rights owners bundle free music services with the devices when they’re shipped, and then the consumer has the opportunity to renew (the music subscription). We’ve got to get away from the idea of filemanagement. It seems crazy to me that we live in a world of music where people spend all their time managing digital-media files, renaming them and backing them up. If you could get to a world where you just turn on the device and you immediately access channels of music, with a great way of navigating and discovering new music, that’s how you hit that main market.
You’ve appointed a new CEO, and you’ve become executive chairman. Why?
Nine months ago, I decided I’d like to focus on our strategic partnerships with major rights owners, major consumer electronics companies and stakeholders. And we needed a full-time CEO who was focused on making sure we were a well-oiled machine. We were lucky to secure the services of Jeff Hughes (former EVP and Chief Information Officer at satellite broadcaster BSkyB). The lessons Jeff has learned at Sky we’ll apply to ensure the music industry can see faster growth in subscription services globally. We’re expanding to 30 countries (up from 20) within the next year. We’ll have a very significant rollout in the US as part of a global rollout.
What is the big challenge for the mobile music market?
Over the past five to six years, there have been a lot of false dawns. What we’re seeing now is a lot of the devices out there in the market – PCs, Blu-Ray players, TVs, and car systems that are increasingly being connected and are powerful enough to have really high-quality user services. I’m a big believer of the concept of cloud-based digital music services. And that is all genuinely happening at the moment. It’s a very exciting place to be, because it still is very much the early days. Over here in Europe, 80% of consumers say they’ve never downloaded or played a single digital music track in their life, whereas 95% of consumers have bought at least one CD. The vast number of consumers have yet to adapt. There is no question that you’ll see a lot more players coming to the market over the next 12 months rolling stuff out globally.
How is the recorded music business going to get over the hump?
The most important component is providing a user experience that is better than piracy, and better than what we’re delivering today, and to do that on a massive scale. Ironically the two places that are not particularly well served are the living room and the car. That’s where we really need to get to if we want to hit the more wealthy demographics who are never going to be using an MP3 player. Behind the scenes, there is a lot of activity in both of those areas, and they are being thought out. If we can get that great user experience, then we’ll see adoption from them and revenue cascading down from it.