Any other business

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Wonga Future 50: Rara.com

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The online music business is sewn up between iTunes, Spotify and Youtube. But could there room for one more entrant?

Rara.com already has the endorsement of all the big record labels. And it brings a twist to the interface (browser-based, streaming) and pricing. Unlike Spotify, it’s not a “freemium”, ad-funded tier – as the more free users a music streaming service has, the more it has to pay to music rights holders. Rara.com is the first digital music service to adopt the Discounted Introductory Subscription (DIS) business model, which is successfully used in pay TV and print publishing by companies such as Sky, Which? and The Economist.

This means consumers get unlimited access to more than ten million songs for a micropayment of just 99p for the first three months of their subscription, thereafter paying the standard subscription rate of £4.99 per month for web-based access on any PC or Mac. A premium subscription tier providing access on web and mobile is just £1.99 a month rising to the industry standardised rate of £9.99 per month after the first three months.

Chairman Rob Lewis is an industry heavy hitter. Rara.com has the funding and model to cause serious thinking among the current cosy cartel of online music.

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