Music Ally

Nokia’s Ovi Store continues to grow. New stats released by the company show it’s now generating 1.5 million downloads a day. That’s not just apps, though – it includes ringtones and wallpapers too. Even so, the store was at one million a day in December, so the stats show that usage of Nokia’s store is growing fast.

However, the average registered user has downloaded 12 applications from Ovi Store, which sounds good, until you consider recent research from AdMob which claimed that the average iPod touch owner downloads 12 apps A MONTH.

Still, the fact that India, Indonesia, Russia, Saudi Arabia and Vietnam are among the ten biggest markets for Ovi Store downloads show that Nokia is starting to make good on its promise to reach countries that iPhone doesn’t.

Talking of India, Engadget reports that its Nokia Music Store has quietly gone DRM-free, becoming the second of Nokia’s music stores to do so (following Russia). That’s the a la carte store, obviously, not Comes With Music.

Yesterday we reported that UK digital music firm Omnifone claimed to be the most widely available music service in the world.

Whether or not the claim held any water when it was made is already a moot point.  Nokia’s Comes With Music service is now available across the Middle East, which means that it’s operational in 27 markets, compared to the potential 20 that Omnifone can reach. On top of this  the a-la-carte Ovi Music service is now available in 33 markets and is completely DRM-free. For comparison, iTunes music store is currently available in 23 countries.

It’s easy to be disparaging about Comes With Music, the service that bundles unlimited downloads into the cost of a handset, not least because the figures have been less impressive than music industry execs had expected; while Nokia itself confesses that the service has been disappointing in some key markets.  But all credit to the Finns as they continue to forge ahead with the strategy, finding international niches more successful than the initial UK outing.

Nokia’s consolidation of its various services under the Ovi umbrella continues, with Nokia Music Store next in line for a rebranding. That’s according to the company’s latest financial results, anyway.

“In Russia, Nokia also launched Ovi Music, representing the first step of its plan to bring Nokia Music Store – our 22-strong chain of digital music stores – into the Ovi stable of services,” says a statement within the financial announcement.

And the results? They were pretty impressive, given the criticism the company has faced in recent times. It reported €12 billion of net sales for Q4 last year – down 5% year-on-year, but based on a 12% rise in handset shipments to 126.9 million.

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Brands are talking to more stakeholders in the music industry when working on deeper marketing campaigns, but they are impatient if this means drawn-out negotiations, according to Nokia’s VP of music Elizabeth Schimel.

“We don’t do traditional sponsorships any more,” she said in a MIDEM session on brands and music this morning. Nokia is keen to work more closely with artists – witness its recent campaign with Rihanna – but this is changing its approach.

“With artists, it’s more about just ‘I’m putting you in an ad’. But that’s not something you can just do in a contract between you and a label,” she said, while warning that having to bring labels, publishers and managers to the table isn’t an excuse for hardball negotiations.

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2009 has seen the rise of streaming services Spotify and Pandora (and the fall of several of their rivals); governments grappling with anti-piracy legislation; The Pirate Bay trial – and then its tragicomic sale saga; and hundreds of bright-eyed music start-ups and thousands of iPhone apps. And STILL no Yellow Submarine iPod.

We rounded up the key trends from the year for our final Music Ally Report of 2009, and the article is republished below in full. If you’re interested in our service in 2010, with its daily bulletin and fortnightly analytical report, click here for a free trial.

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Nokia is on the verge of announcing that 10 million songs have been downloaded by Comes With Music users in Brazil, just seven months after it launched there.

It provides more evidence for the notion – accepted by Nokia – that its music service may get more traction in emerging markets where there is less competition from legal services. Figures revealed by Music Ally earlier this year showed that there were 10,809 active CWM users in Brazil in July.

With no update, it’s hard to gauge how many songs the average user there is downloading though.

Nokia is suing Apple, claiming that its iPhone infringes ten of Nokia’s patents relating to GSM, UMTS and WLAN technology. The complaint has been filed with the Federal District Court in Delaware. Did anybody see this coming? Not us.

Nokia claims that it’s signed licensing agreements regarding the ten patents with “approximately 40 companies, including virtually all the leading mobile device vendors”. But not Apple, clearly.

Nokia says the patents cover wireless data, speech coding, security and encryption, and that every single iPhone model since the first one in 2007 has infringed them. “By refusing to agree appropriate terms for Nokia’s intellectual property, Apple is attempting to get a free ride on the back of Nokia’s innovation,” says Ilkka Rahnasto, VP of legal and intellectual property at Nokia, in a statement.

Nokia has unveiled the latest stage in its marketing campaign for Comes With Music. It’s called ‘Comes With… Riddles’, and will take place entirely on Twitter.

The company is giving away ten 5800 handsets with bundled CWM subscriptions between 22nd and 31st October, with three partners – Rock Sound magazine, London Elektricity and Family Music. Each day, one of the partners will tweet a riddle, with the answer being a band name and track title. The first person to reply to that tweet with the correct answer gets the phone.

The odds are certainly good of bagging a phone: three people entered today’s first round…

Music Ally has been passed details of the global uptake of Nokia’s Comes With Music service, which suggest it is struggling to make headway. As of July, Nokia had just over 107,000 active users of CWM in nine markets around the world.

That’s according to figures sent out by the company to record labels and distributors. In the UK specifically, Nokia had just shy of 33,000 active CWM users in July, up from 23,000 in April.

The full list of markets breaks down as follows (sorted by launch dates):

CWM ACTIVE VOUCHERS– JULY 2009
UK – 32,728  (launch date: Oct 08)
Singapore – 19,318  (Feb 09)
Australia – 23,003  (Mar 09)
Brazil – 10,809  (Apr 09)
Sweden – 1,101  (Apr 09)
Italy – 691  (Apr 09)
Mexico – 16,344  (May 09)
Germany – 2,673  (May 09)
Switzerland – 560  (Jun 09)

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Nokia has just announced its Q3 results, and for the first time, it’s broken out the revenues it’s making from services – including Comes With Music and the Nokia Music Store, along with its Ovi Store app store, games and mapping. The topline figure: €148 million (around $221 million).

There’s no further breakdown of that into individual services – all Nokia has to say about Comes With Music in its announcement is that it’s now available on 17 devices in 12 countries, with Austria, the Netherlands and South Africa the latest countries where CWM has launched.

On a wider level, it was a tough quarter for Nokia. It reported net sales of €9.8 billion, down 20% from Q3 2008. Nokia shipped 108.5 million handsets during the quarter, down 8% year-on-year. However, more worryingly, the company sold 16.4 million smartphones – or ‘converged mobile devices’ as it calls them – up 5.8% year-on-year.

Against stiff competition from iPhone, BlackBerry and Android, it seems Nokia isn’t enjoying the smartphone sales surge that many predicted. The company sold 4.5 million of its Nseries handsets in Q3.