Music on the Go – A Starbucks and HP Joint Strategy

I think this is a great idea.

Here's a deal: Sip on a mocha latte while using headphones to listen to any of 250,000 songs you call up on a computer. Then order the ones you like — burned on your own CD — to go. Who's the dealer? Starbucks (SBUX ).

BusinessWeek has learned that on Mar. 16, the Seattle coffee giant will unveil an in-store music service allowing customers to do just that, using Hewlett-Packard (HPQ ) tablet computers to make their choices. The first musical Starbucks opens in Santa Monica, Calif., and the service will expand into 2,500 stores over the next two years. "This is not a test," says Starbucks Chairman Howard Schultz. "We're going for it."

It's a good match. People who frequent Starbucks are the kind who are more likely to be into digital music. It's easy, probably pretty cheap, and allows users to sample music before they buy. Plus, Starbucks is a place some people go just to sit or hang out, so now they have something else to do. Normally I don't like to see companies move beyond their competitive advantages. But, Starbucks isn't about coffee, it is about something deeper and I think this strategy speaks to that. This is good outside the box thinking. My guess is that it will be pretty successful.