Sony Pulls The Trigger In Streaming War

Sony has become the first company to launch a substantial cross-platform marketing campaign for a streaming service in Australia, with Music Unlimited making a play for market share over the weekend.

One of the original services to launch in Australia, Music Unlimited has been largely overshadowed by the entry of services like Spotify, Rdio, Mog, Deezer and Songl. Even more services, including those from Google, Apple and locally-owned Vu are expected to be rolled out this year.

Alison Turner, Sony Network Entertainment International's Regional Marketing Director, told The Australian that the “significant investment” is being piloted in Australia – where it is across television, including The Voice, outdoor and digital media – before they roll it out into other markets.

“We believe Australia, with its high awareness of music streaming services and wide take-up of technology devices, is a fantastic destination for us to premiere this campaign to support the Music Unlimited service,” she said. “We will closely review the results for the Music Unlimited service in Australia in the coming months to help shape the way we roll out the campaign in other markets.”

Earlier this year AIR General Manager Nick O'Byrne told theMusic the streaming market would be dictated by the first service to commit advertising spend to the market.

“They key will be who takes the step to sink a whole lot of marketing dollars into [the market],” he said. “A lot of the services are trying to establish themselves and when someone steps forward to do that we'll see some manoeuvring.”

Upon launch earlier this year, Austereo Southern Cross and major label-backed Songl believed they'd be opening the market to a new demographic of listeners through their radio platforms, and Sony are following the same line with their campaign.

“There are a lot of consumers who aren't using, or in some case even aware of, music streaming services yet, and those are the customers that we are targeting with this campaign,” Turner said.

Music Unlimited is available on Sony, Android and Apple mobile devices, as well as Sony television and home entertainment devices which – like Google's Android tie-in – gives it access to a wider range of demographics than services that just service Apple products. It's priced at $7.99 per month for PC and Playstation3, and $12.99 for mobile devices.

Turned added, “We are targeting a broad demographic of 'pop music lovers', which is the vast majority of people. The majority of these people are 25-plus, so are not digital natives and are used to buying and owning music rather than streaming it, so they require more education of music streaming services in general.”

Meanwhile, reports have emerged overnight the Apple have secured a deal with the Warner Music Group and publishing arm Warner Chappell for their streaming service, dubbed 'iRadio'. The Pandora-competing service had stalled over negotiations for royalty payments. According to US-based CNET's sources, the deal is the first for the streaming service that includes both the recorded music and publishing divisions.

There has still been no official word from Apple on the service, and scrappy negotiations with labels are ongoing, but they may look to announce the first aspects of the service at Apple's Worldwide Developers Conference, which starts 10 June. Google announced Music All Access similarly at their annual developers conference.

As the market begins to shake itself out towards the end of the year, and 'independent' services look to compete with the likes of Google and Apple, artist royalty payments will dominate the industry debate. A recent report from Australian-based Venture Consulting warned investors away from the market, branding the space high-risk and speculative and the current business models unsustainable.

The report advised businesses to negotiate lower royalty payments to labels and artists as they took a greater share of the listening public.