The Infinite Dial

With WiFi being a central feature of the new iPod Touch, Apple had an interesting choice to make--one with ramifications for everyone reading this. Some pundits speculated that this would finally bring open wifi radio to a portable device, akin to the Sansa Connect's integration with Yahoo Music. Of course, the Sansa is a closed-loop system--you can only listen to Yahoo Radio, and purchase songs via subscription to Yahoo Unlimited, but it still represents a start--turning the mp3 player from a sealed box into a portal.

Apple could have opened up the iPod to Internet radio--but they didn't. And why should they? With little money being made--yet--in internet radio, they had little incentive to hitch their wagon to one of the leading streaming players when they continue to sit on the biggest cash cow (in the true Boston Consulting Group usage of the term) in the music industry--the iTunes music store. So instead of listening to your station on an iPod, owners of the iPod Touch and the iPhone will be back on the iTunes music store, as usual, tightening Apple's grip on consumer music.

There is one exception--an integration with Starbucks that allows iPod users surfing the WiFi in a Starbucks store to automagically click a button and buy the song currently playing in the coffee shop. Earth's largest music store joining forces with Earth's largest retailer (in terms of number of locations--take that, Subway!). One of the most magical elements of the Apple brand is its ability to always look like the underdog--but with this move, they are Goliath, not David. I'm with Rick Rubin on this one--music is a commodity now, plain and simple. And Apple is Archer Daniels Midland--Supermarket to the World. If you are a music station, it is more important than EVER to have begun executing a web strategy to build community around music and music discovery, which still play vital transactional roles in the great music machine. Radio used to be the sole arbiters of musical taste over the air, but has ceded that role to the Internet, as our most recent research has shown. But "the Internet" doesn't have to be someone else's web site--it could (and should) be yours. Cede nothing.