Starbucks to incorporate HP’s iPod music player into new music venture?

“Starbucks Corp on Tuesday unveiled a new kind of coffee shop serving up custom music CDs along with foamy coffee drinks,” Duncan Martell and Chris Stetkiewicz report for Reuters. “Years of customer queries about the music piped into its ubiquitous coffee shops prompted Starbucks to tap into a new revenue stream, which might also keep customers in its stores long enough to order another latte.”

“‘We do see this as an add-on to the Starbucks experience, but we also think there is a real business here,’ said Don MacKinnon, Starbucks vice president, music and entertainment. Using a variety of computer gear and support provided by Hewlett-Packard Co., Starbucks customers will be able to record five songs for $6.99 — about twice the price of a double-tall latte — in about three minutes,” Martell and Stetkiewicz report.

“Starbucks world-wide chain now includes more than 7,600 cafes and executives foresee it growing to more than 25,000. Palo Alto, California-based HP supplied about 70 of its Tablet PCs, workstations and CD publishing and printing systems, along with its trademark printers at the music cafe. HP also designed the user interface and the software. The store uses HP’s data storage gear and HP ProLiant servers store the more than 10,000 available albums and 100,000 song titles.,” Martell and Stetkiewicz report.

“‘We have done it in a way that a person will walk out of Starbucks with something that feels like they bought it at a store,’ Felice Swapp, director of strategic initiatives for HP said. ‘It’s allowing your typical Uncle Bob to start getting into this digital mobile lifestyle.’ HP in January also announced plans to soon sell a digital music player based on Apple Computer Inc.’s popular iPod player, which will be available by around June or July. In addition to the player, HP will also make Apple’s popular iTunes digital music jukebox and online music store available to HP customers starting in March and April. Financial terms were not disclosed,” Martell and Stetkiewicz report. “When asked if HP’s new player will be incorporated into the Starbucks musical venture, Starbucks chairman Howard Schultz said: ‘It’s a possibility. We’ll have to see.'”

Full article here.

Related MacDailyNews article:
Starbucks to enter digital music market with HP – will they use Apple iTunes? – March 11, 2004


  1. Hmmm…Here’s the million dollar question….Will the HP designed music store stick with AAC or go with WMA? And, if they go with WMA, then we can only assume that the HP iPod will be WMA enabled. My assumption, and I”m sure it’s the same as many of you, is that they will be sticking with AAC.

  2. It’s was obvious in the last report, and it’s obvious now: Starbucks is going to sell CDs, not digital music. The songs will not play on your computer, only on the kiosks which HP will set up for them. You can stand there and listen, and then burn your selections to a music CD. That’s all. Nothing more. No iTunes, no iTMS, no WMA, no iPod.

    Which format they intend to use is irrelevant because the consumer will never see it.

  3. I have no special insider knowledge here…. but I assume the Starbucks thing is some existing turnkey system, nothing to do with Apple–a product with a different purpose from iTunes. In other words, it’s music, but it’s not a music market Apple is in. It’s not an iTunes competitor per se, just another totally different type of product. Why not? Give it a shot.

    If people are burning audio CDs and not getting compressed files (regardless of whether those files were initially compressed or not), codecs and compatibilities aren’t an issue. HP can use whatever they want that works best for Starbucks–and when people get home with the CD, sure, they can use it with iTunes and iPod just fine.

    I’m sure if Apple were involved in this, they would have coordinated press releases with HP and and Starbucks and made a bigger deal of it. Not just because it’s one more partnership–it would be a whole NEW category of product that Apple would have been secretly developing. I just don’t think that’s the case–and if Apple has no solution of this (experimental) type anyway, then it doesn’t hurt Apple for HP/Starbucks to try something non-Apple.

  4. I can see this being a cool concept. You are waiting on your drink and you hear some tunes. Doesn’t take long to get five songs together you like. I can imagine the CD looking as professional as anything you’d buy at Virgin.

    Speaking of which, doens’t Virgin do something like this now? Similar to CompUSA installing kiosks to burn software CDs on demand rather than stocking inventory, packaging, outdated versions, etc… Burn as needed for bricks & mortar stores will be a good way to go for those people who want a physical CD.

  5. with 100,000 songs they are either compressed or there installing a 4+ terabyte array at each store. My bet is they are compressed as it would take a hell of a lot of 6.99 cd’s to pay for a $20,000 raid array. In 128kbs AAC it only takes a couple of 250 G drives.

  6. ‘It’s allowing your typical Uncle Bob to start getting into this digital mobile lifestyle.’

    This is nonsense! Digital lifestyle? C’mon, that’s no digital lifestyle… that’s just buying a CD, which any average joe can do without having a digital lifestyle…

    Each time I get a free tune with the pepsi promotionl, I have a hard time choosing the song I really want… so imagine putting 5 in 10 minutes… to me that’s no easy job. Anyway, might be good for some people, but I just don’t need any more CDs hanging around my place… and if I rip them, I can kiss the quality good-bye… 🙁

  7. Hey, TRRosen…
    Ever considered the songs will not be stored locally at all – and that it will be done through network shares?
    This way the song database is central, and easily updated. And when burning a cd they just stream it or cache it first.

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