Can KT make Genie rival Apple’s iTunes?
By Yoon Ja-young
Will KT’s new music platform be as successful as iTunes? At least the K-pop industry is hailing the new service as it guarantees them a bigger slice of the pie.
KT announced that it is launching “Genie,” a cloud music service, jointly with KMP Holdings to distribute music from the country’s major entertainment agencies including SM Entertainment, YG and JYP.
Users can buy the music and enjoy it through a range of devices such as smartphones, desktops, MP3 players and on IPTV, using KT’s cloud service.
Pyo Hyun-myung, president of the mobile business group at KT, said that the service aims at sparking a renaissance of K-pop. “The videos of K-pop stars get nearly 800 million views on YouTube…the music industry is going through a paradigm shift in the smart era,” he said at a launching ceremony for the service, Wednesday. He pointed out a survey according to which 80.5 percent of smartphone users said they use their mobile handset to enjoy music.
“People will connect to music through their smartphones. They will store it in the cloud and access it whenever they need it. They will be continually connecting themselves to music, instead of owning it.”
Bigger pie for copyright holders
Pyo, however, pointed out the systematic problem of the music industry here, where intellectual property rights are being neglected.
“Consumers here are under the impression that music is free, thus deterring the growth of the market in terms of both quality and quantity. There is also the problem of income distribution…the music service providers get too much.” Music service providers such as portals and mobile carriers used to get nearly half of the money, while Apple returns 70 percent of the profits to those who have ownership of the music, such as the label, entertainment firm, creators and artists.
Kim Young-min, CEO of SM Entertainment, said that the music industry receives little compensation for their music. “When someone downloads 150 songs in a monthly package, they pay 60 won per song. The music industry gets 30 won of this. Even when the music is downloaded 1 million times, the profit is not enough to even shoot a music video. ‘Genie’ is the model we should pursue,” he said.
Pyo said that the new service aims at a “win-win” situation for both the platform and the content provider, in the same way as iTunes.
In “Genie,” the music copyright owners, not the service provider KT, will determine the price of each song. For instance, they can charge less for older songs and more for new releases. It plans to provide not only music but also music videos and photos of K-pop stars to differentiate it from other music services.
The application will be preloaded on handsets of Samsung Electronics and LG Electronics, and it will also be available in China and Japan as KT has partnerships with China Mobile and NTT Docomo. “The market of Korea, China and Japan comprises 700 million users,” Pyo stressed.
KT will launch the beta version of “Genie” for Android smartphones from Thursday.