May 2, 2008 • 1 min read

Nokia say Comes With Music is viable

Nokia say they expect to make money from Comes With Music, and head of music operations Liz Schimel says critics have misunderstood the model.

Nokia have said that they believe their Comes With Music venture is commercially viable, after much speculation as to how much the phone firms are paying the record labels so that their music phones can come pre-loaded with a year's worth of access to entire catalogues of music.

Some reckon the money paid to Universal - and due to be paid to SonyBMG - in return for being able to give their customers access to those major's music for free for a year eats up all of the phone maker's profit margin on the mobile handsets. If that was the case, the whole venture would presumably have a limited lifespan, which wouldn't be good for the phone company or, long term, the record labels.

But Liz Schimel, the head of Nokia's music operations, told reporters this week: "We expect to make money both from our traditional device sales, as well as from the 'Comes With Music' service. I can assure you that we are looking out for everyone's interests in creating these new business models, including our own".

She added: "Recent articles that I've seen have fundamentally misunderstood the concept behind the Comes With Music model. This new model is innovative and creates a positive situation for all stakeholders, but it does require a different way of thinking for our content partners".

Make of that what you will.

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