CD-burning kiosks business model

An interesting article on the failing business model of placing kiosks in public spaces i.e. retail outlets like Walmart etc. …

The concept seems great: Place CD-burning kiosks that can manufacture out-of-stock albums in retail stores and offer customized compilations, too.

But after numerous false starts, retailers, hardware suppliers and the major labels say a quagmire of issues still threatens to overwhelm the initiative.

Even with the momentum of Starbucks leading the way […] retailers say that in-store CD manufacturing still has one big problem: an unprofitable business model.

… for me this business model ain’t broken, providing customers with access to a broad selection of music for in-store burning of personalized mixes (delivering immediate gratification) without the need for big inventories on the retailers side makes perfect sense … the problem seems to be rather that the music labels are not happy about this business model (innovation, hmm, hmm) … together with significant hardware costs:

stringent content-usage requirements from the majors […] each major label is licensing music for kiosks with its own set of strings attached

Billboard puts this in context:

In their usual lack of responsiveness to rapidly changing market conditions, it sounds like the labels are going to miss out (again) from a chance to earn new revenues from an untapped market segment.

Business model innovations are not always welcome, still one has to wonder if this is the right path …

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