Since news and details are so sketchy, I went out and talked to some friends in the music business and ring tone sector to get some more insight about what this could mean to Skype and the music business.
Overall, the feeling is unanimous that there is more to the deal than RingTones and images. One very senior ringtone industry veteran flat old told me that the word last week in Cannes was that this is all about WMG introducing their bundling strategy, something the WMG execs I conferred with this morning seem to agree on.
There is also quite a bit of concern about DRM (Digital Rights Management) a subject that Skype’s PR person in London, Kat James said was not yet ready to be announced. Yahoo’s Brad Garlinghouse when queried wondered “if we really need another DRM solution” and I tend to agree.
Here are some other thoughts I’ve collected this morning from a few friends in the biz who are in the know, but for reasons of confidentiality asked to remain anonymous.
“Ringtones are a start, but probably not what they're aiming for long-term. It's unclear how much value a personalization product has when the "phone" is ringing in your office or home, not out in public where people look at you and think how cool you are based on your tone.”
“Master tones might not be the best fit. If I'm at my PC and a song starts playing, I might think it's an ad on AIM or a misfired stream or something, not necessarily an incoming skype call. Unique sounds might be better suited.”
“Ringbacks make more sense. It's annoying to listen to the "ring-ring" while waiting for someone to pick up”
“Their current ringtone store, powered by Qpass, desperately needs better content than all the sound effects. Who needs a "zip" sound to go off when they receive a call? (maybe that's for incoming booty calls). Should let you record your own ringtone ("Andy on skype line one, sir") so you can feel important. This all could be part of their plug-in strategy.”
“DRM is critical for PC-based downloads; I'm unclear on what they're using/how it works/how hard it is to hack.”
“With all those users, they could easily turn it into a storefront for other products by adding new options in the dropdown for how you want to use the file: as ringtone/as chat alert/ even leading to a full track download”
Another person from the industry wondered about "carrier reaction", citing this may be the first global solution for ringtone sales without carrier involvement (or 40% rev share). Wonder what sort of deal Skype struck with WMG.”