Rara.com, a new take on music subscription services, launched Tuesday in 16 territories including the U.S., U.K., France, Germany, Italy and Sweden. It will also launch in seven additional markets, including Canada and Mexico, later this week.
The company is betting there's money to be made from people latecomers. Not only is this U.K.-based company going after digital virgins, they're not going to give away the product for free.
Digital latecomers constitute a large group of consumers: Rara.com Director Tim Hadley says the company found that only 20 percent of consumers are paying for digital music on a regular basis. It also found that 60 percent of consumers had yet to adopt any form of digital music (meaning no streaming and no downloading).
But unlike Spotify, Rdio and Mog, who have embraced the freemium model to attract mainstream users, rara.com has opted for a more mainstream product. "We think the mass-market approach to music should be completely seamless and should get away from that need to manage media files," Hadley says.
Nor has rara.com has chosen to follow Pandora down the free, ad-supported path. "The fact is today no one is making money from pure, ad-funded music streaming services," says Hadley. "And no one is likely to."
The pricing is standard except for rara.com's use of a short-term discount to help lure customers. PC-only streaming costs $4.99 per month and the first three months cost just $0.99 per month for new customers. PC and mobile access goes for $9.99 per month and will cost just $1.99 per month for the first three months. Android users can get the rara.com app today. iOS users will have to wait.
But just how profitable are the digital latecomers who haven't yet dipped a toe into downloading or music streaming? When posed the question, Hadley told Billboard.biz that rara.com looked at lessons in other media. Fifteen years ago, people weren't paying for digital TV content like they are today, he says. Then Sky came along and proved people will pay for it. "It's about getting the user experience right for the market."
Rara.com stands apart from its peers at first glance. While Rhapsody, Mog and Rdio (and Spotify, to an extent) are clearly built for music enthusiasts, rara.com comes across like Pandora crossed with a colorful screensaver. The sparse layout puts an emphasis on broad channels rather than specific artists. A listener can choose from decades (such as "Best of '90s"), moods ("Chilling Out," "Sunday Morning") and a variety of playlists ("Get the Party Started," "Remembering Coachella"). It's not hip, but it's not trying to be.
Channels are programmed by humans, not algorithms, says Hadley, and artists will curate channels, too. Imogen Heap - hardly a digital latecomer - is the first artist-associate editor to be named. Heap will provide a range of playlists and will act as advocate for the service.
But rara.com listeners can dig deeper, too. The service claims to have over 10 million tracks and licensing deals with all four majors. Listeners can search for artists, songs and albums in a search box and play individual songs or entire albums. Holes in the catalog do exist, however. Charles Caldas, CEO of indie rights organization Merlin, said in a statement he is "truly astounded" the music service would launch without Merlin's catalog. Titles distributed by IODA were spotted, but Billboard.biz's spot checks for titles distributed by TuneCore and CD Baby turned up nothing.
To help distribution, rara.com is working with Hewlett-Packard across Europe to include rara.com as its primary music partner on its devices. HP devices will come with rara.com pre-installed.
The service was created and licensed to rara Media Group (rara is all lowercase) by Omnifone. A rara.com spokesperson says Omnifone does not have an ownership stake in rara and describes the relationship as an "arm's length commercial agreement."