Tonight I had dinner with Alex Zubillaga of Warner Music. During our dinner conversation we spoke a lot about the so called problem of music piracy, namely the heavy downloading going on on the internet that results in people filling up hard drive after hard drive with music that they do not have the rights to listen to. As we all know, the problem of illegal downloading is considered by most executives one of the biggest problems facing the music industry but for Alex Zubillaga who is in my view one of the smartest, more visionary thinkers in the music world this is not the case. Alex spends most of his creative time working on models that embrace music downloading without destroying the industry he represents. Now after brainstorming with Alex for a few hours I came back home and thought that the whole downloading phenomenom is likely to dissappear in the not so distant future. This is why.

We are now evolving towards a world of ubiquitous home and office broadband (cable and DSL) connected to WiFi. At Fon with our formula of paying and sharing at home and enjoying WiFi everywhere, we are extending this environment to most city streets around the world. As this new world unfolds I believe that one of the surprising side effects of it will be the end of music and movie downloading. Why? Because in a world of ubiquitous wireless broadband downloading as an activity simply does not make sense anymore. In the future all iPodlike devices will have WiFi as the Music Gremlin does now. And homes will have systems such as Sonos that streams any song that you want whenever you want. Now when WiFi enabled iPods and Sonos like systems are hooked to services such as Napster or Rhapsody who give you instantaneous streamed access to 2 million songs a month. Why would you download music wasting time and costly hard drive space? In WiFi everywhere world Limewire becomes obsolete as Limewire is not free. Limewire has basically two very significant costs, one is hard drives and the other is your time organizing, labeling all your music. Napster, Rhapsody give you fantastic interfaces, instantaneously streamed music and a choice of 2 million song instead of 10,000. Bottom line. Downloading won’t be killed by laws or policing. It will be killed by broadband streaming technology available everywhere that will make downloading obsolete. And when services like Rhapsody appear for movies, namely all you can eat movies for $10 to $20 per month this will be even more the case. At 4GB per movie who wants to hoard say 10,000 movies when all you can watch is one at a time?

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