Nokia says that 150 playlists “that are curated and kept up to date by an expert team of US based musicologists” are available, comprised of a wide variety of music genres, from classical to house dance music. Additionally, playlists created by Lana Del Rey, Lady Gaga and Rihanna, as well as other well-known performers, are available. But Nokia Music isn’t just made up of the service-provided playlists. Personalized playlists can be built using the “create” function, which access millions of songs in Nokia’s music library.

The free service should appeal to music lovers that own a Lumia device in the US. Nokia Music doesn’t contain any advertising, so music will be uninterrupted. And the playlists can be accessed offline, so tunes can be enjoyed without using up precious mobile broadband. A “gig finder” feature also offers information on local music events and the app ties in to Nokia’s digital music store where users can purchase MP3 songs or albums.

Nokia Music is likely the first of many new announcements coming from the company. Tomorrow, Nokia has a scheduled press event in New York City, where it is widely expected to debut handsets designed to run Microsoft’s Windows Phone 8.

The approach is similar to that of Pandora, which has long offered ad-supported online music tracks and subscription plans. And like Pandora, the updated Spotify for Android allows the creation of stations based on artist, album or playlist. You can skip a song if it’s one you’d rather not hear and Spotify will learn not to play it again. Give a “thumbs up” to a favorite song and Spotify will save it to a “Liked from Radio” playlist on the desktop.

Surely, Spotify hopes that a taste of the free version will entice subscriptions. But the company’s conversion rate isn’t too shabby; even before this move. Ken Parks, Spotify’s Chief Content Officer and Managing Director of Spotify N. America recently noted that Spotify has 15 million active users and over 4 million paid subscribers.

Aside from the ads, there’s no real limit to the free Spotify radio service, so it should appeal. Users have access to the millions of tracks in Spotify’s catalog on their Android smartphone or tablet. The updated app is available in the Google Play store and supports devices running Android 2.1 and up, which is nearly all active devices on Google’s platform.

We do — that was that state of digital media when paidContent launched in 2002. Other weird things were happening back then too: People still got much of their news from television and newspapers, and they learned about major events after they had already happened.

There have been some huge shifts since 2002: Tablets and smartphones are now ubiquitous, lots of people read on their digital devices, and just about everyone is part of a social network or three. This summer is the tenth anniversary of our launch. In an effort to gain some perspective on the past decade in digital media, I’ve been reading back through paidContent’s archives — a collection of over 80,000 posts.

Since I was only a freshman in college when paidContent came to life, I often didn’t know, as I read through the stories from the early days, how things had begun or how they turned out. As I watched them unfold, I wanted to grab our readers’ arms and give them advice (“Don’t buy that Zune!” “Invest in Facebook!” “Go for the good Twitter handle now!”). But I also realized how difficult it is to predict success.

Some takeaways from my trip through the archives:  Some companies — AOL and Yahoo come to mind — have been consistently bad at predicting what consumers want. And a couple of companies, namely Apple and Amazon, have been very good at it. Also, being a native digital company helps, but it’s no guarantee of success (what up, MySpace?). And after all these years, it’s still not clear what content customers will pay for, or how much they’ll pay.

Streaming and Moviebeaming

What do analysts, CEOs and bloggers have in common? None of us can predict the future. Roger Ebert joked in 2002 that “on-demand streaming movies on the Web, like HDTV, are five years in the future — and will be for at least another 10 years.”

If Disney’s Moviebeam had been the only game in town, Ebert probably would have been right. When it launched in three cities in 2003, customers paid $6.99 a month to use a device that could hold 100 movies and plugged into the back of a TV set. They also had to pay for each movie they watched– billing was done via the phone line. The company went through various unsuccessful iterations before India’s Valuable Group bought it in 2008. It was never heard from again.

Netflix almost went down the same road. It had a plan to release a Moviebeam-like “proprietary set-top box with an Internet connection that could download movies overnight.” But instead, it decided to forge ahead with streaming — starting with a complicated “quota hours” system in 2007 and moving to unlimited streaming in 2008. By 2010, the majority of subscribers were streaming something, and the company began offering streaming-only subscriptions, though CEO Reed Hastings said that same year that the company would keep shipping DVDs until 2030. (We’ll see about that.)

ABC was the first network to sell episodes of its shows on iTunes, back in 2006, and to stream shows free with ads on ABC.com — and later on AOL. But by the time premium subscription service Hulu Plus launched in 2010, the platforms getting the attention were devices with built-in access, like Internet-enabled TVs, Blu-ray players, and tablets.

Return of the living dead

Speaking of AOL: It’s something of a miracle that the company still exists. In 2000, when it merged with Time Warner, it was valued at $350 billion, and the next year, more than 24 million people in the U.S. were paying for its Internet access service. By the end of last year, that number had dwindled to just 3.3 million subscribers. Here’s a quick recap of some of AOL’s miscues over the years:

• AOL Voicemail ($5.95 per month)
• A teen service called Red (featuring “a talking head—using the image of an actual employee—that uses software to answer users’ questions”)
• A digital music partnership with Burger King
• A reality show called “Gold Rush”
• Social networking site AIM Pages
• Going free
• The hyperlocal Patch blogs

Though AOL was once a high flier, no other company ever liked it quite enough to buy it. Google bought a five-percent, $1 billion stake in AOL in 2005, leading analysts to wonder if Microsoft missed out. That resulted in a $726 million writedown in 2009. Time Warner bought back Google’s stake and finally spun off “the albatross” in December 2009.  AOL is still promising a bounceback. “The executive team expects a profitable content business by next year,” CEO Tim Armstrong said in May 2011.

Yahoo hasn’t fared much better. The company launched Yahoo Platinum in 2003; for $9.95 a month, subscribers got access to audio and videos.  The program was dead by October of that same year. It later tried a Twitter-wannabe microblogging service (“Meme…where you share everything that you find that’s interesting,”). Perhaps the smartest move Yahoo ever made was not buying AOL.

Where did these companies go wrong? In 2010, former Time Warner CEO Gerald Levin pondered that question in an interview with the New York Times . The AOL-Time Warner deal was “undone by the Internet itself,” he said. “I think it’s something that no one could have foreseen, and to this day, whether Apple is going to dominate entertainment or whether Amazon is going to dominate publishing, all the old business plans are out the window. How do you get paid for content?”

Know what’s cool? A billion dollars

In 2006, an RBC Capital analyst estimated that a certain social networking company would be worth $15 billion in a few years, based on “raw, unprecedented user/usage growth.”

Six years later, Facebook went public with a valuation of $104 billion. Too bad the analyst wasn’t talking about Facebook but about MySpace. The social networking company that Rupert Murdoch acquired for $580 million in 2005 sold for just $35 million in 2011.

Why did Facebook soar while MySpace — and other social networking services like Friendster — sank? It allowed people to build real connections using their actual personal information, and rolled out a product that was ready to scale and had good technology. Other companies realized sharing was important too — in 2005, Yahoo SVP Jeff Weiner called sharing “the next chapter of the World Wide Web” — but Facebook was able to implement it in a way that kept users coming back. The site surpassed Yahoo and AOL for “stickiness” in 2009, when Nielsen found users spending an average of four hours and thirty-nine minutes a month on Facebook.

Social has already disrupted some industries — witness the rise of Twitter and the way it has changed the way news is reported, with stories like Osama Bin Laden’s assassination breaking there first. In a sign of the importance of these emerging platforms, newspapers like the Wall Street Journal and New York Times are launching “Everywhere” initiatives to deliver news to readers where they are already hanging out.

Fast food and music don’t mix

Hard to believe it now, but there was real skepticism that iTunes’ 99-cent songs would be able to compete with peer-to-peer file-sharing services. “According to academics who’ve studied the economics of digital music distribution,” we wrote in 2003, the year iTunes launched, “the cost still seems too high to attract users of peer-to-peer file trading services.” The piece cited an economist who believed “the appropriate price of a downloaded song is 18 cents.” In fact, Real Networks dropped its song prices to $0.49 in an attempt to compete against Apple.

In the end, consumers choose selection and convenience over P2P networks. We called iTunes “a kickstart for the micropayments industry.” Was it? While Steve Jobs said in 2004 that Apple wouldn’t hit its one-year, 100 million songs downloaded goal, global digital music sales crossed $1.1 billion in 2006. In April 2008, Apple surpassed Walmart  as the largest music seller in the United States.

The company that arguably started the digital music revolution — Napster — didn’t survive. Once it no longer offered “free,” it was done, though it tried to reincarnate itself: launching a mobile music service, “Napster To Go,” with AT&T in 2004 (the one smartphone that supported it could hold up to 6 songs), partnering with Circuit City on a digital music store, getting itself acquired by Best Buy in 2008 ,and then being bought back by Rhapsody in 2011. Unfortunately, Rhapsody was already losing out to newer (and free) streaming services like Pandora and Spotify.

The partnerships with Circuit City and Best Buy, though, were probably the kiss of death. One of the big trends of the past 10 years has been brick-and-mortar retail stores’ consistent failure to compete effectively against digital-native companies. Best Buy wasn’t the only retailer to try to crack the digital-content business — and fail: Target and Sears both took a shot. And McDonald’s sold digital content over its WiFi network and even tried DVD rentals in its restaurants.

Do you like the feel of paper?

Just as digital music didn’t really take off until Apple introduced the iPod, the ebook revolution didn’t take place until the arrival of the Kindle. In paidContent’s early years, ebooks were written off as a failure in part because publishers couldn’t figure out what to do with DRM. (In 2003, “temporary electronic ink” that would disappear after a few months was floated as a possible solution.) Barnes & Noble decided to stop selling ebooks in 2003, and Yahoo stopped selling them in 2004.

Meanwhile, Amazon and Google were pushing forward. Google launched Google Print – now called Google Book Search, and still besieged by lawsuits seven years later. Amazon tested two now-defunct programs: Amazon Pages, which allowed customers to buy access to digital copies of select pages from books, and Amazon Upgrade, which bundled print books with online access to the complete work.

Customers weren’t biting. Then Amazon came out with the Kindle in 2007 for $399. Less than two years later, Amazon was selling more Kindle books than print books, and ebooks now make up over 20 percent of some big-six publishers’ sales. Barnes & Noble has had some success with its Nook e-reader and digital bookstore, but bankrupt Borders shuttered all its stores in 2011. Meanwhile, the Department of Justice suit against Apple and five big publishers for allegedly colluding to set e-book prices drags on.

Good thing Steve Jobs looked beyond ringtones

A Forbes survey back in 2002 found that “business professionals” would be willing to pay for “news content to be delivered to their cellular devices,” and some media companies tried early mobile experiments. Verizon offered a cell phone version of the Yellow Pages — which, at $19.95 per year, gained 15,000 subscribers in three months. But starting in 2004, everyone decided the future was in ringtones. A $4 billion global business by the end of the year, one company projected.

So, so many ringtones. You could buy them from Rolling Stone or from an ATM-like device called E2Go. A fall 2004 marketing campaign let you mix your own ringtones on Levi’s website. Billboard launched a top ringtones chart.

Could ringtones “prove to be a passing fad”? we wondered late in 2004. Luckily, yes — a new technology came along to shake up the mobile market. No, it wasn’t the $500 ESPN phone, but the iPhone, which came out in 2007. And by opening its platform up to third-party app developers, Apple got users ready for its next ecosystem-changing device, the iPad, in 2010.

Monetizing mobile

Advertising has always been a fuzzy business — how exactly do you measure engagement and success? Well, that’s still the big debate about advertising in the digital era.  ”If here’s anything that’s really holding back ad spending on the web, it’s the lack of good measurements,” Tim Armstrong, then Google’s VP of national sales, said in 2007.

Mobile advertising has also faced obstacles. In 2006, mobile carriers began allowing advertising despite fears of annoying customers. Customers were indeed annoyed – 79 percent of them found mobile advertising annoying, according to a 2007 Forrester study — but they could “see the potential benefits of mobile advertising and marketing to themselves,” particularly if they could get a useful special offer or coupon.

Further complicating matters for advertisers: The smartphone market is fragmented among different brands — marketers don’t want to spend the money to create different ads for Android and iOS — and there are two mobile ad universes: mobile browser and apps.

Nevertheless, mobile advertising has gained ground, crossing  $1 billion in the U.S. for the first time in 2011, according to the Interactive Advertising Bureau, totaling $1.6 billion for the year.

The next opportunity is social media advertising. And once again, it will be a challenge to figure out some standardized metrics. What’s a retweet worth, anyways?

Back to where we all began

Though micropayments worked well for music when Apple launched iTunes, the path to payments for written content has been rockier. In 2004, we wrote that “micropayments today are still characterized by a large number of competing transaction types” – including direct-to-bill, merchant aggregation, prepaid accounts and direct transfer – and “each of these face the current incumbent in digital content distribution: the flat-fee subscription model.”

Eight years later, it appears that the subscription model has won out. The iPad opened the door for magazine and newspaper publishers to create new revenue selling content on that platform, but the results have been mixed. When Rupert Murdoch’s “The Daily” iPad newspaper launched in early 2011, the company called it “the model for how stories are told and consumed.” We wrote, “The bet here is that while consumers are less and less likely to reach into their pocket for a few quarters to buy a newspaper, they might not care about the 14 cents on their credit card for a copy of an e-newspaper.” A year and a half later, The Daily has over 100,000 paying subscribers — but it’s living on borrowed time and may not get through the five years its publisher has said it needs to break even.

Writing for the web, of course, has been around for awhile. At the beginning of the decade, blogging was called “nanopublishing,” and the question was how blogs could support themselves doing it. All sorts of models have arisen. For example, Gawker tried a licensing deal with Yahoo, but that relationship ended a year later. The deal “garnered way more attention than we expected, but less traffic,” Gawker CEO Nick Denton said in 2006.

Some bloggers have stayed independent and make a living from advertising (or from their day job); others write their blogs under a newspaper, website or larger magazine’s umbrella — see the Dish’s Andrew Sullivan, FiveThirtyEight’s Nate Silver, WaPo’s Ezra Klein. Or, they go to work for the Huffington Post!

Magazine companies have grappled with whether to bundle digital editions with print subscriptions or charge for them separately. Time Inc. — which first put digital editions of its magazines behind AOL’s paywall in 2003 — started out charging separately, but today Time Inc. and Condé Nast print subscribers get the digital edition free. Hearst, meanwhile, is charging separately, and it said its digital business in the U.S. became “solidly profitable” for the first time in 2011.

Could there ever be a Netflix for magazines? Time tried it for print versions with its 2008 Maghound service. It failed, due to a lack of marketing and reader interest. Magazine publishers are trying again with joint venture Next Issue Media.

Many newspaper publishers, most notably the New York Times, tried paywalls at the start of the decade and then abandoned them – only to return to the model in the past couple years.  In its most recent earnings report, the NYT said it has 454,000 digital subscribers. Is that enough to sustain the newspaper in its 21st-century transition?  Probably the best answer to that came from  Vivian Schiller. But it was in response not to the NYT’s recent digital subscriber numbers, but to the NYT’s decision in 2004 to close the paper’s first paywall, known as TimesSelect. Schiller, then the SVP and general manager of NYTimes.com, was asked whether TimesSelect had worked.  “It did work,” she said. “It’s just a matter of as compared to what.”

Birthday cake photo courtesy of Shutterstock user [Robyn Mackenzie].

TV photo courtesy of Shutterstock user [Somchai Buddha].

Zombie hand photo courtesy of Shutterstock user [lineartestpilot].

Piggybank photo courtesy of Shutterstock user [cardiae]

Fast food photo courtesy of Shutterstock user [Sergio Martinez].

Book photo courtesy of Shutterstock user [TrotzOlga].

Ringtones and apps photo courtesy of Shutterstock user [violetkaipa].

Cash register photo courtesy of Shutterstock user [titelio].

Magazines photo courtesy of Shutterstock user [bernashafo].

That may sound obvious based on the price: Google is selling the Nexus 7 in an 8 GB model for $199, while $50 doubles the capacity. However, if you had any doubts on the audience Google is targeting with the Nexus 7, they will disappear as soon you turn on the device for the first time.

A consumption-focused first impression

When I heard Google was going to use six dock icons on the Nexus instead of the traditional four, I wondered why. It makes sense now and not just because there’s room for six icons plus the Apps launcher button: Every one of the six is a shortcut to Google services, and five of the six are media items. You can move these around or replace them.

The leftmost icon is actually a folder of Google’s nonmedia apps: Chrome, Maps, Talk, Gmail and so on. After that, you’ll see, in this order: Books, Magazines, Movies, Music, Play Store. If you have used a Kindle Fire before, you’ll note the similarities, although Amazon accomplishes this with tabs on the main user interface. But there’s more.

Nexus 7 has five home screens, and guess what takes up the entire main screen? A widget called My Library. The widget automatically surfaces media content you have purchased or rented from the Google Play store. Like all widgets, you can move it, delete it or resize it, but it makes an interesting first impression. I recently rented but haven’t watched Sherlock Holmes: A Game of Shadows, and it’s now a tap away. The device came preloaded with Transformers: Dark of the Moon, and it’s there too in the widget.

I hit the Google Music icon and all of the albums I previously uploaded to my music storage locker already showed; there was no setup involved, because the device and your media accounts are linked by a synced Google account. I streamed some of Christina Perri’s lovestrong album, and the widget now shows the album cover so I can quickly go back to her music later. Again I’m reminded of the Kindle Fire. When you consume media on the device, a shortcut to it is added to the main bookshelf user interface for a fast return.

It’s a consumer tablet that will appeal to the geeks too

Of course, unlike the other small, inexpensive slates on the market, Google’s Nexus 7 is a full Android tablet right out of the box. There’s no hacking to be done here if you want access to apps in the market or to install the apps you want. I’m guessing we will shortly see custom ROM software for the Nexus 7 to improve the experience for the Android geeks like me. So with its $199 slate, Google is easily able to cater to both audiences: Those that want a simple, easy-to-use consumption device with occasional tablet use and those that want a complete Android tablet experience.

I already like what I see here in the review unit, and I’m likely to get my own device; I preordered but can always cancel. But I’ll have a full review after using the device for a few days while on vacation next week. And I’ll be sure to hand it over to my wife, who uses a Kindle Fire every day. I would suggest that Amazon and Barnes & Noble be worried, but Google still has work to do on the media store front.

Yesterday at its Google I/O event, the company announced more content options, so I decided to compare Google Play against the two incumbents. So how does Google now fare, considering it introduced the Nexus 7; an Android 4.1 tablet that’s optimized for Google Play?

I did a similar analysis in October, only then it was to see how Samsung fared against Apple and Amazon, and decided to take the same approach here with Google. Here’s what I found when looking at the most popular movies, TV shows, music albums, starting first with music.

Amazon sounds cheaper while Google Play has some dead air

Amazon offers the most “bang for buck” here, although prices can vary by the day. Just this morning, a George Harrison album on my wish list, for example, dropped from $9.99 to $2.99 and I bought it. In terms of the top 10 — again, using iTunes as a baseline — Amazon has 9 of 10 while Google is batting .600 with four strikes. Of course, this is just a narrow view; when casually browsing all three stores for music that I like, they’re generally equal although Google is still either missing a few.

Google at the movies isn’t bad

Google fares a little better here although it still lacks the breadth of content provided by iTunes and Amazon when looking at the current top 10. But like Amazon, Google Play offers lower prices than those found in the iTunes store. When the family wants to watch a movie, I’ve turned to iTunes in the past — mainly because we have an Apple TV. For my own consumption on a tablet or phone, however, I’ve been fine with Google Play. Amazon doesn’t support movie playback on any phones or tablets save its own Kindle Fire, so I rarely look there. Update: The original comparison showed Amazon with SD movie rental pricing, which was incorrect as pointed out by readers. The current table shows the HD movie rentals.

Don’t look for recent TV shows on Google

If you want to watch current HD episodes of TV shows, Google store isn’t playing. The company announced TV show support yesterday, but it’s like looking through an old Netflix catalog as current hot shows aren’t there. Even Amazon falls a little short: When looking for the most recent episodes of popular shows on iTunes, Amazon lacked one and had another in standard definition only.

Magazines are magazines are magazines

Google also added magazine support in Google Play this week and rather than be methodical about the comparison, I spent about 20 minutes browsing the digital newsstands. The main reason why is because the top magazines were available among all three at the same price. Checking the breadth of titles showed the same: Google is at least on even par with Amazon and Apple here. The experience of reading magazines may vary by device — small tablets and phones vs the 9.7-inch iPad, for example — but there’s little differentiation in content here.

Conclusion

Apple’s iTunes Store and Amazon’s market are a close one and two while Google is still playing catch up. Yes, the company has improved digital media offerings in Google Play of late, but there’s still work to be done. I recently said that consumers aren’t buying products anymore; they’re investing in platforms instead. Android as a platform may be the best seller, but Google needs to keep negotiating content deals to strengthen its ecosystem and give consumers a reason to shop in Google Play instead of Amazon or iTunes.

Currently mSpot’s movie rentals are available on either the day of or the day after the DVD release; Samsung already has its own media hub for movies but it doesn’t have a digital media locker solution of its own. Instead, Android owners of Samsung handsets are likely using Google Music or the Amazon MP3 player app for online storage of tunes. Indeed, Samsung had to partner with Dropbox for cloud storage on the new Galaxy S III handset; offering 50 GB of free space with the phone purchase.

Samsung highlighted the various new options mSpot will bring to smartphones and tablets, saying in the press release.

“The acquisition will provide a cloud-based entertainment experience of music, video and radio services for users of Samsung devices, while extending mSpot’s cloud and streaming solutions to a broader base of global entertainment fans. The combination will extend mSpot’s top class cloud and streaming services while further enhancing Samsung’s mobile and tablet device entertainment offerings. mSpot’s entertainment services will be a key integrated offering on newly announced Samsung mobile devices.”

Terms of the deal were not disclosed, nor were any hints at when mSpot’s platform would be integrated into Samsung’s mobile devices.