Walk into the glamorous lobby of the Washington (D.C.) Four Seasons Hotel before noon and you'll hear some smooth jazz, maybe a little Sade or Nina Simone. Stop in for afternoon tea, and you'll hear Frank Sinatra or bossa nova king Jo?o Gilberto. By evening the mood has changed again: Barflies sip cocktails to the funky bass of Jamiroquai and Thievery Corporation. The DJ? The Four Seasons' iPod.
In April the hotel ended its longstanding contract with Muzak to sign a deal with Audiostiles, a New York startup using iPods and their clients' existing sound systems to create made-to-order ambience without repeating songs. "This service allows us the ultimate flexibility," says David Bernand, the Four Seasons' food and beverage director. "I can hear any song I want, anytime I want. I have complete control."
Entrepreneurs have been quick to build a service economy around the iPod boom. "The idea that there is a market here is a slam dunk," says Ted Schadler, a digital music analyst at Forrester Research, which predicts that the market for digital music will grow to $4.5 billion in 2008.
Audiostiles' Jeremy Abrams is just one entrepreneur hoping to prove Schadler right. Abrams launched Audiostiles in 2004 after a stint programming for XM Satellite Radio. "The iPod was a good excuse to get into the game because it was a new technology that was really practical for business," he says. With a girlfriend who worked as a publicist for New York restaurateur Daniel Boulud, Abrams was soon hooked into the world of high-end restaurants and spas. Rates start at $35 per hour of programmed music, plus the cost of any songs Audiostiles has to buy. The next step: branded CDs for clients to sell to their customers.
Year-old HungryPod and three-year veteran RipDigital, both in New York, program iPods for individuals at $1.25 to $1.50 per CD. Catherine Keane started HungryPod when friends' requests to rip CDs and load playlists onto iPods started to number hundreds of CDs per week. She has a franchisee in Houston and plans to kick off a Washington (D.C.) service early next year. RipDigital distributes CD kits through high-end electronics retailer Tweeter, letting consumers send in up to 200 CDs to be returned as digital files or loaded on an iPod.
Fort Collins (S.C.)-based Muzak argues that music programming via iPods isn't robust enough for businesses. "There's a lot more to providing a music service than loading an iPod and sticking it in a closet," says spokesman Sumter Cox, who says Muzak has negotiated rights for 1.6 million songs. Audiostiles requires its clients to pay the licensing fees, though Abrams says he's working to make that easier for smaller clients. In the meantime, for many businesses, loading an iPod and sticking it in a closet sounds pretty good.
By Jane Black