Well – Virgin Digital is done selling music online. They have transferred all their customer stuff to Napster.
When a customer focused, value add focused, cash flush company exits a market so quickly and quietly, it makes you wonder why. There are not that many reasons:
- It was hemorrhaging money: But I think not enough of a reason in this case.
- Outside core value offering: Definitely think this is a good reason for Virgin Digital to exit this market.
- Outside company strategy: Reasonable, but not for such a quick exit.
- New strategy in place: And not compatible with existing strategy. Very reasonable – and I think the most likely.
- Exec hated and killed it: It happens, and could be related to any of the above.
So – if I am right about number 4 – that Virgin has a new strategy in place that is not compatible with the existing service, then what could that service be? Here’s what I could imagine:
Virgin Mobile music download service. A la carte downloads directly to your phone. Much like Verizon vCast. The open question there is: Would this be enough to draw new users to their service, or do will they need and do further differentiation?
We’ll see. I give it 6-9 months before they roll out a new service under a different corporate banner.