Nokia Comes with Music fails to hit right note

A year ago Nokia had launched Comes with Music - a subscription-based service that allows users of certain Nokia smartphones such as Nokia 5800 XpressMusic and Nokia N96 to download for keeps an unlimited number of tracks to their handset over a 12-month period - hoping that the service would not only act as a new revenue stream but also kick-start a new era of mobile digital music downloads.

The service was launched in nine countries and Nokia said Comes with Music users download around 200-300 tracks during their first month of which 10 percent are new releases.

However, according to industry blog MusicAlly, as of July 2009, only 32,728 people used the service in the UK while the number of users in Australia and Singapore were much lower - 23,003 and 19,318 respectively.

In Mexico and Brazil, where the service was launched this summer, the figures were much worse - 16,344 and 10,809 respectively.

In the remaining countries viz. Germany, Sweden, Italy and Switzerland, Comes With Music fared even worse with only 2673, 1101, 691 and 560 users availing of the service.

According to MusicAlly, which published the figures, the service has not given Nokia the returns it has hoped for, "considering the investment it has made in Comes with Music."

"However...there is evidence that Comes with Music is doing better in emerging markets than in developed Western countries where there is more competition," it added.

MusicAlly's figures are shocking as Nokia boasted earlier this year in April that it sold more than 3 million units of Nokia 5800 XpressMusic smartphones alone in the first three months of 2009.

Meanwhile, though Nokia has refused to comment on the figures, saying it it against the policy of the company to comment on industry speculation or rumours, yet, it acknowledged that many people are unaware that the service allows one to "download and forever-keep as many tracks as you like."

However, it said that it will not only continue to provide the service but also expand it in more countries.

"In terms of innovation, Comes with Music is a significant shift for both consumers and the industry alike," MusicAlly quoted a Nokia spokesman as saying. "Nokia will continue to bring new services to market, and we will continue to add further countries and partners to our Comes with Music rollout."

Earlier in April, Nokia Music vice president Lenn Pryor was quoted as saying that no matter what, Nokia will not give up on Comes with Music despite the response it received in the UK was worse than expected.

"The UK was our first launch market, and we learned a lot from that experience," Pryor told the Telegraph. "We learned that the right device is just as important as what we're offering. When we launched in the UK, the timing was such that we launched it with two devices that were slightly out of date."

However, Pryor said the company has learned its lesson and "subsequent launches in other countries with the [touch-screen] Nokia 5800, the hero device, are doing very, very well."

"We won't give up on Comes with Music, or the UK," he added.

Moreover, in order to spur interest in the service, Nokia is also offering its earliest adopters in the UK a free 90-day extension of Comes with Music service to commemorate the first anniversary of the service in the UK.

However, industry analysts feel the numbers do not bode well for the company as UK users, the first to approach the end of their built-in service, may choose not to renew their subscriptions.

"With other services making round in the market such as Spotify, Napster, 7Digital, Sky Songs and iTunes, people today have more choices and unless Comes with Music cleans up its act, Nokia, which is wading in the red, will be staring down the barrel," an independent tech analyst said. Nokia reported a net loss of £838 million in the September quarter as against a profit of £1 billion for the same quarter a year ago.

The analyst said Nokia has been slow in educating people about the service and though attractive, many have been left confused. "Lots of folk are not certain about what Comes with Music offers. What do you get? What happens to the tracks downloaded? Do you keep paying every time you download? These are some of the questions still hounding Nokia users today," he said, adding that though the rollout of the service by Nokia has been fast by industry standards, yet, challenges presented by DRM-locked tracks, localising content, a limited range of Come with Music compatible phones, and free music streaming offered by other companies stood as roadblocks on the way.

In conclusion, whether Comes with Music will live long enough to celebrate its 2nd birthday is anybody's guess.