01:00 AM

3.14.07 Is Slacker competing against iPod or XM/Sirius?

Even as XM and Sirius have conceded there's not enough users for two sat radio services, some industry execs are launching Slacker, sort of Satellite 2.0, Matt Marshall reports.

They announced a web-based service today and are releasing PC software shortly, which will provide a free (with ads) alternative to iTunes. And they're coming out with their own player as well.

It's a satellite service that lets you teach it what songs you like and which you never want to hear again. The company is aimed at the vast majority of iPod users who don't keep constantly updating their playlists. You just turn it on and you get music you like - limited, however, by the universe of music the company has licensed, currently about 2 million songs.

So you can't pull up the music you want to hear immediately, don't get to own it and can't use it on your computer, you can't listen to podcasts, can't put your own music on it. On the plus side, you don't have to think about it, don't have to transfer music from PC to device, and don't have to buy music, just pay $7.95 a month for the ads-free version (the with-ads version would surely be unacceptable.)

The device is about the size of a blackberry. So you can carry it around like you do an iPod. However, Slacker’s servers will communicate with your Slacker device constantly. It uses commercial satellites, and WiFi, refreshing your device’s drive with new songs when they are available. The communication happens every 15 seconds. If a new song found by Slacker matches your preferences, your device caches it. Then, if you do enter a place where satellites and WiFi can not reach the device, you can still listen to music from the cache. Slacker has a car dock.

The player seems to be a problem to me. People aren't going to buy an iPod, a phone, a PDA and a Slacker. This is a service and the device to use it on is a sat-enabled, Wi-Fi enabled phone. Maybe such things don't already exist? But the stronger business model to me is to get Verizon to pay Slacker, rather than taking Apple head on in the hardware, content and web service businesses all at the same time. In any case, if it's such a good idea, all Apple needs to do is build a sat-enabled iPod and Wall Street will be amazed at the innovation of Steve Jobs.

Perhaps Slacker should aim at XM/Sirius instead of Apple. After all, they're offering what sounds like a better satrad experience than what those companies offer. Frankly, it sounds more music-industry friendly (details stats, no way to replicate content, no downloads, no PC-to-device transfers) than consumer-friendly.