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Who will be humming Nokia's tune?

• Rory Cellan-Jones
• 2 Oct 08, 21:28 GMT

It's supposed to be the biggest launch in digital music since Apple opened the iTunes store but until now we've been missing some key facts about Nokia's plan - such as what it will cost. Now we've got those details and can work out whether it will really change the world - or at least give Apple a run for its money. For that to happen, the service needs to satisfy three sets of people with very different interests - the record labels, the mobile phone industry and the music buying public.

The consumers

Let's start with the most important group. They are being told there's now the promise of "free" music with a mobile phone, as many tracks as they can download in a year - and a music collection they can keep forever. None of that of course is quite true.

The to feature "Comes With Music" will cost 拢129.95 and will be sold just as a pay-as-you-go phone - indicative of the audience it's aimed at. But without the music the Nokia 5310 can be got for around 拢70 - so in effect you're paying 拢60 for a year's downloads. Not bad - but your collection will be hedged around with restrictions. It will come wrapped in DRM, which means it can't be played on an iPod if that is your music player of choice. It will be restricted to two devices, your phone and a computer which both have to be registered with Nokia.

Once the year is up, you keep the music - but on those devices. If you buy a new computer - or Nokia handset - within two years you can transfer the music to them. What you don't have is the real ownership that you get with DRM-free music. Still, parents who are worried about their teenagers file-sharing may decide that buying them a mobile with music is quite a cost effective way of keeping them the right side of the law.

The music industry

Desperate for an alternative to Apple, the big record labels have been doing deals left, right and centre, but they must be hoping that mobile music is their best hope of a new business model. Nokia has far more customers worldwide than Apple, and many of them are from the generation which has grown up with the idea that music is something you get free from the internet. What we don't know is what kind of bargain has been struck with Nokia and the mobile operators - in other words, how that 拢60 will be shared out between the labels, tthe retailer, and everyone else who wants a bit. And will artists be rewarded for each free donwload - or will the DRM reveal how often every track is played, with bands getting a share related to their popularity? As Apple's current row over royalties from iTunes shows, there's plenty of scope for discord.

The mobile industry

For the handset makers the network operators and the retailers, what's not to like about the idea of building the digital music platform of the future? Nokia's plan doesn't allow users to download direct to the phone, so there's no extra data traffic for the networks to "monetise", but then again they will presumbly get their cut from the extra cost of the phone. Now that 5Mp cameras have become old hat, music will become the key marketing tool for new handsets, and a way of tieing customers in to a longer relationship. And don't you bet that all those dull old telecoms executives have cast envious looks at the way Apple has become even cooler by its association with the music business? Watch out for the Brit awards next year - the event will be packed with men in suits talking about ARPU, HSPA and MVNOs. Very rock'n'roll.