Struggling to compete with pirated CDs and MP3 sales, GMM, which commands up to 70 per cent of the Thai music market, has formed a strategic partnership with True Corp to make its entire music bank of nearly 30,000 songs available for download. The songs will be available at kiosks, on websites and through handsets on GPRS channels.

"We expect full song [digital music] downloads to replace 30 per cent of CD sales within the next 12 months," said Suwat Damrongchaitham, managing director of GMM Digital Domain, the digital music subsidiary of GMM Grammy.

GMM's announcement heralds a departure from the company's previously more conservative path in terms of pursuing digital opportunities compared to its rivals. The target of replacing 30 per cent of CD sales, if achieved, would be revolutionary in the local music industry, given GMM's substantial market share. Competitor RS Plc, which pioneered the local digital music business, has said it expects digital music to account for at least 10 per cent of its sales by the year's end.

Suwat said falling CD sales would not affect the company's bottom line because sales would increasingly be replaced by digital music downloads which offer a higher profit margin. That's because there are no manufacturing or distribution costs involved.

"And when revenue from digital music exceeds CDs, profitability can be doubled or tripled," he said.

GMM is confident its full song-download service is competitive can compete price-wise with pirated CDs and MP3s.

It will charge Bt35 per song or Bt149 a month for unlimited song downloads. During a promotional period, GMM will cut the subscription fee to Bt89 a month for two months. Pirated MP3 CDs with 100 songs cost about Bt100.

However, customers have to keep their subscriptions valid in order to keep the music files playable.

Piroon Paireepairit, multimedia services director of True, said customers could subscribe to GMM's full song-download service via four channels.

lBy visiting True shops where staff can offer technical assistance;

lBy clicking going to the www.trueworld.net website and paying a monthly service fee through a Mobile Money Cash Card or via the True hi-speed Internet invoice;

lBy using Bluetooth technology to transmit songs to friends via True Move mobile phones;

lBy downloading songs from CDs online and selecting various payment options including pay per song, which offers unrestricted listening, or an unlimited package, offering unlimited downloads.

"We chose True because it has the largest number of Internet broadband customers and physical outlets, compared to other mobile phone operators," he said.

GMM Digital Domain has seen its sales increase 180 per cent over the past 12 months, mainly from ring tone downloads. The firm expects revenue of Bt600 million this year, up from Bt400 million in 2005.

Pichaya Changsorn

 The Nation