The New Zealand music e-commerce site mp3.net.nz has announced that Telecom has taken a 5% stake in its business – and will soon allow customers to have purchases charged to their Telecom bills.
Telecom made an investment of $22,000 earlier this year, but mp3.net.nz founder, Auckland entertainment lawyer Chris Hocquard has held off discussing it until elements of the site's "strategic partnership" came closer to fruition.
Aspects of the partnership are already apparent: Xtra publishes the site's Top 13 chart of downloads and Xtra customers who buy four tracks from the site get another for free. But the ability to bill in small increments via Telecom will solve one of the site's key problems.
"We have a micropayments problem the same as anyone else," says Hocquard. "At the moment we say the minimum purchase is $10 – and the reality is that of that our e-commerce provider takes 50 cents, our bank takes 5% and we play a flat fee per month for the service as well.
"The problem is on a $2 file by the time you pay all those people and then you've got to pay the artist, the banks get more money than anyone else. If we can get to the Telecom billing thing then we can bill them tiny little amounts and it's easy for people. And apart from anything else, we're selling to a market that doesn't necessarily own credit cards."
Hocquard says the site, which shifts about 3Gb monthly from a catalogue of about 600 songs from more than 200 local artists, is making a number of other changes – including replacing the current 45-second samples of each track with a full-length stream in the m3u streaming format, in an effort to encourage visitors to spend longer on the site and make return visits. He says the site currently attracts about 50,000 visitors a month.
The streaming facility will also be linked to the Top 13 chart, so visitors to the Xtra site will be able to play back individual tracks from mp3.net.nz.
Hocquard says he has also settled on an MP3 player to sell via the site – a $599 personal player from the US company Pine that has no built-in memory but instead uses compact discs for storage.
"You're still going to have to burn your own CDs first – either we'll supply them or you'll burn them yourself - but the great thing is they'll play your WAV files or your MP3 files and they'll use rewritables," says Hocquard. "One of our partners has imported them and is going to warranty them in New Zealand and we'll have exclusive agency for them for a couple of months."
Early next year the company will begin offering a "make your own compilation" service, shipping CDs with either MP3 or WAV files, depending on the customer's requirements, and also selling a monthly Top 13 compilation on CD.