Rattle wrote:

So far, there are only three technical implementations of methods for securing digital downloads: Apple’s, Microsofts, and Real’s. Real can be written off, as Rhapsody is completely failing in the marketplace.

Do you have good data on that?

A year ago, they were still growing:

Forbes says that Real now has 1.4 million subscribers compared to its 700,000 customers at the end of 2004.

"Real executives argue that consumers are warming to the notion of subscriptions, arguing that the success of satellite-radio offerings from Sirius Satellite Radio and XM Satellite Radio prove that people are willing to pay a monthly fee for music. But to date, Internet music subscription offerings like those from Real, Napster and Yahoo! have yet to take off-–there are perhaps 3 million subscribers to Internet music services, compared to 9 million for satellite radio."

For more recent figures:

As of the September quarter, RealNetworks (Nasdaq: RNWK) claimed 1,650,000 subscribers to its Rhapsody music service ...

That's from a few months ago, so clearly they have leveled off. But note this:

Rhapsody subscribers, who pay $10 a month for unlimited access, today listen to about 130 million songs per month.

So Real is pulling in $200M annually, whereas Apple pulled in (less than*) $1B last year. So in terms of cash flow, Real has about 20% of the market. That isn't winning, but it's a far cry from "completely failing." Also, Jobs says iTunes now sells ~150M tracks in a month. That's comparable to the number of plays that Rhapsody sees from a much smaller user base.

Lately, they are moving beyond PC-based services; see their recently announced partnership with TiVo, for example.

Don't get me wrong, I am no fan of PlaysForSure -- it is incredibly flaky code -- but I think the business model is still full of potential.

Fortune magazine recently commented on the future of music. Here's their senior editor:

Rhapsody, not iTunes, in my opinion, is the future of music.

...

RealNetworks is way ahead of Apple in navigating the complexities of licensing and software for a streaming music service. Maybe the two companies will somehow get together. Until they do, or Apple otherwise gets the music subscription religion, the iPhone won't be what it should be.

I tend to agree. The Rhapsody experience is so remarkably different from that of the iTunes Stores, it's hard to communicate effectively. I might draw comparisons to the way that the new/upcoming Netflix streaming service will change the way you watch movies.

(*) Jobs says that iTunes sold a billion songs in 2006. Considering discounts for album sales, this is less than $1B in revenue.

RE: DRM, Statutory Licensing, Broadcast Flags, and Satellite Radio