New Record Label: Starbucks

2. Record labels hate the blanket 99 cent per song pricing model of iTunes. They believe that they are getting short-changed so that Steve Jobs can sell more iPods. Starbucks, which now exclusively sells rare Bob Dylan songs and songs from its own signed artists, does not have to deal with this. Starbucks not only has more control over pricing, but with distribution as well. Pretty soon, smart record labels (i.e. the small ones) will realize this. Musicians will start seeing this too and will also build record labels based on the Starbucks model. Music will be price-segmented into premium designer music and deeply-discounted commodity pop music (Wal-Mart music store?).

3. Unlike the iTunes Music Store, Starbucks offers digital music that people are willing to pay for without sacrificing the face-to-face social factor. People have been getting together based on music taste for decades. This will just make it all the more easier. See you when Lost Highway Records decides to open its first country barbeque music house that serves Ryan Adams songs free with Lucinda Williams fries.

Contributed By Jason Tan