Unlike mobile contracts, where you still have the phone and the networks still have the monthly payments, there's no announced route for Comes With Music owners to sign up for another year. The news from Nokia World was that various legal issues have been worked out with the music industry to allow those on the service to switch over to a monthly billed service, although details have not yet been announced.
Nokia's decision to not time-out the audio files at the end of the year is to be commended (after all, it would be quite evil to take away these huge music libraries now, wouldn't it?), but with this monthly billing they are probably hoping that users will stick with their Nokia phones, and of course make that monthly payment... because that payment level is going to be set by the individual networks, who could subsidise and promote the offer whichev er way they feel is best for their needs. Which is a win for Nokia (keeping them in the ecosystem) and a win for the networks (more revenue per user).
The Finns are going to have to get a move on to catch the initial waves of customers in the UK, and they're going to have to make some noise so everyone knows this is something that they're able to do. Up until now the assumption has always been that you had to buy a new phone to keep the Comes with Music service, which from a short-term point of view would be best for Nokia (sell a new phone every year? marvellous). In the current economic climate that's unlikely to happen.
This will now last a little longer...
One of the stumbling blocks on the subject of renewing Comes with Music by the new handset route is that most networks (at least in the UK) have got people on 18 or 24 month contracts and it's doubtful that they would pay the breakout fees just to grab their music subscription again. The big new handsets that will Come with Music, the X3 and the X6, were announced at NokiaWorld, but they aren't in the retail channels yet. They're also going to be relatively expensive for those that picked up the initial Series 40 device or the (old, even then) Nokia N95 8GB in the initial months of Comes With Music. So going to a monthly model for existing accounts is a win for everyone concerned.
Of course this expiry question was always going to happen, it's part of the DNA of the music store that they have built so there should be plans in place. It's unfortunate that Nokia haven't made a lot of press to say that this is happening beyond a minute or so at Nokia World.
Now that Nokia have moved away from the initial standing of "you have to buy a new phone at the end of the year" to something that's a lot more sensible, the next step seems to be obvious. Given the competition with other online music services that offer 'unlimited' music and are starting to move into the smartphone space (such as Spotify), Nokia need to be agile with their software services to keep ahead of the start-ups. Hardware cycles are measured in months if not years, but the software of the web can turn on a matter of a few days when something 'just works'.
Where does that leave Comes with Music? Well it's proven that it can adapt beyond the original mission - admittedly, with the huge amount of momentum behind the record companies it does take some time, so I wouldn't expect any more major changes before the end of 2009, but I would not be surprised to see Nokia allow new subscribers to join without requiring a phone purchase at some point early in Q1 2010. If Nokia are truly behind their services then the time to act is always now. I await their next move with keen interest.
-- Ewan Spence, Sept 2009.