Edgar Bronfman, CEO of Warner Music (and 70% controller of Warner shares with his Private Equity firm), is berating the mobile phone manufacturers to make their phones easier to use as music devices!
After all, these devices sit in the sweaty palms of 3 billion people, which are customers that Edgar want to get his hands on, if he and his colleagues are to have any hope of reversing their lingering demise. Trading at $8, down from their float price of $17 of two years ago, Pali Research now has them down at $5 target price.
Edgar conceded that the pace of demise of the CD market took them by surprise. To offset this they are now looking to use mobile phone downloads to drive growth. Plus they are now looking to monetise a wider set of related products including concert tickets, videos, merchandise and other goods.
Hmmm. Me thinks that the mobile operators aren’t going to give up their customers or related value so easily. Content is great, but exclusivity is important and which label is going to want to do exclusive deals in a territory.