Peter Kafka

Recent Posts by Peter Kafka

The Early Numbers Are In: Is Rhapsody’s iPhone App a Hit?

rhapsody appThe music industry has yet to convince consumers that paying a monthly fee to listen to music is a good idea, but it’s still trying. The newest gambit: Tying the subscription services to mobile phones so that you can listen to any music you want wherever you are (in theory).

Spotify, the much hyped service that has yet to appear in the U.S., is a mobile play. Rival MOG says it will have a mobile subscription offering in the near future as well. But the new mobile product from RealNetworks’s (RNWK) service, Rhapsody, has actually been up and running for a little more than a month, and the company says results are encouraging: Real says that more than 500,000 people have downloaded its app for Apple’s (AAPL) iPhone.

The problem: This stat alone doesn’t mean much. You can only get streaming music through the Real app if you’re already paying the company $14.99 a month for its “Rhapsody to Go” service.

So how many app users are paying customers? And more important, how many of them became paying customers because of the app?

I’ve asked Real for comment, but I don’t expect one, since the company has typically been close-mouthed about this stuff. But I’m told that Real has about 700,000 to 800,000 paying Rhapsody customers overall. So it’s possible that almost all of the app downloaders are already paying customers and that the app is just a nice bonus.

Did anyone out there actually start subscribing to Rhapsody because of the iPhone app? Let me know via email or in comments below.

UPDATE: Real, to its credit, isn’t making too much of the numbers itself. From spokesman Bill Hankes:

Although we are pleased to see excitement and interest in the Rhapsody iPhone app, it is too early to tell how this will translate into subscriber numbers since we suspect many of the people who downloaded the app are current subscribers already or are trying Rhapsody for the first time with the seven-day free trial.


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