Digital Music Trends – Episode 39

This week: an interview with David Nelson from Muziic.com and one with Megan Elliot from XMediaLabs. In the news the IMHO Player, Rapidshare tough on piracy, Spotify may be set for a Q3 launch in the States and finally some Shazam and Last.fm updates!

www.muziic.com

www.sounds-digital.com
IMO Entertainment launches IMHO, a new social media player blending music, videos, games and advertising.

http://www.billboard.biz/bbbiz/content_display/industry/e3ibfd213a270515452350214f913243ada
http://musically.com/blog/2010/03/25/former-sony-music-boss-launches-imho-social-content-player/
http://www.pamil-visions.net/imho-cloud-content-distribution-is-a-game/213195/
http://preview.imhomedia.com/facebook_connect
http://www.prnewswire.com/news-releases/former-sony-chief-ienner-launches-imho-alpha-89013107.html

Various news outlets such as Billboard Business and Music Ally reported on the launch of the IMHO social media player this week. The player is produced by IMO Entertainment, a company lead by Don Ienner, previously CEO of Sony Music Label group and Columbia Records. The idea behind the player is that it brings together music, video and gaming under a single roof that is cloud-based and geared towards social sharing. The player’s monetization revolves around virtual money that can be purchased outright via Paypal or earned through the exposure to advertising the level of which can be customized within the player, the virtual IMHO money that can be spent to purchase content, personalize your avatar or purchase virtual goods. At the moment the player features 150 radio stations, a partnership with digital distributor the Orchard as far as the music is concerned and over 900 games provided by RealNetworks. The player is geared primarily towards Facebook users, who have demonstrated time and time again how virtual goods done right can generate a huge cash flow – see Farmville’s history for details. The idea seems certainly pretty solid, but the real problem will be finding a balance between free content and paid content. If relatively new users were to experience that the majority of the content on the player requires payment they will soon be turned off by the experience, but just like in Farmville, if enough is given away for free to get them hooked to the platform then they will probably agree to buy almost anything, no matter how daft the purchase may appear. Due to Facebook’s fundamentally unsuccessful strategy up to now in regards to content distribution of music and videos many companies are competing to create an experience that can capture the imagination of the hundreds of millions of people who use the platform every day. IMHO has now captured the industry’s attention, it’s now up to them to demonstrate whether they can live up to their own hype and reach a mainstream audience.

Rapidshare goes all-out against piracy and wants to direct pirates to legal sites for the purchase of content.

http://torrentfreak.com/rapidshare-aims-to-convert-pirates-into-customers-100326/
http://musically.com/blog/2010/03/24/rapidshare-finally-getting-tough-on-illegal-downloads/

Rapidshare, the online file storage and delivery service, has decided to crack down on piracy. The service, which has been widely known to be a sort-of safe harbor for sharing copyright protected material, interestingly decided to start cutting off accounts of known file uploaders and started issuing warning letters to downloaders, probably in a bid to avoid a crippling lawsuit by the entertainment industry. The move took many by surprise as after all Rapidshare’s business had grown dramatically thanks to its sharing-friendly reputation. Torrentfreak, though, offered a different angle on the story after unveiling a letter that was written by the company’s General Manager Bobby Chang addressed to representatives of the entertainment industries. In the letter, Mr Chang condemns new companies that are cropping up with the sole purpose of being cyberlockers for the safe exchange of copyrighted material. He also refers to infringing users as criminals and makes the interesting proposal to deny access to copyrighted material when searched for and replace it with links to sites where the users would be able to buy a legitimate copy of the same item he searched for.

The move has got to be positive news for the music, film and games industry but ultimately pointless as many users who want to continue exchanging files without restrictions will probably just migrate to other services who may have kept a lower profile and therefore so far avoided legal problems. Although this new stance is likely to damage Rapidshare in the short term and reduce its user base it’s certainly a clever move. First of all it greatly reduces the chances of having to fight expensive lawsuits in court. Second the company has now reached millions of customers so even if some were to leave the service chances are that many would stay on and keep it a viable commercial enterprise. Third, if the re-direction of users to legitimate sources was to work I assume it would involve some sort of affiliate sales fee and that could slowly replace the revenues previously generated by copyright-infringing users. I am very interested in seeing how Rapidshare will fare in the next 12 months as the results of this gamble are at the moment completely unpredictable.

Spotify might be aiming at a Q3 launch in the United States

http://www.billboard.biz/bbbiz/content_display/industry/e3if745772b249372ddad2f9ebc7a21298b
http://www.businessweek.com/news/2010-03-26/spotify-online-music-site-targets-u-s-start-in-third-quarter.html

In An interview released to Bloomberg the VP of of Spotify Paul Brown hinted that the service is aiming to go live in the US in the third quarter of this year. Brown said that Spotify is buying server space in random parts of the United States to ensure the smooth running of the service once online and it is still ironing out the details of the licensing deals with the labels. Billboard Business writer Antony Bruno, who picked up on the story, reports that there are also fresh rumors regarding the relationship between Spotify and Google. A couple of months ago, when the Nexus One was first announced, rumor had it that it was going to feature Spotify as an embedded feature. This failed to materialize at the time – also probably because the deals with the labels are not yet finalized – but it does not mean that it won’t happen in the next iteration of the Google phone or that Spotify won’t become a more prominent feature in new versions of Google’s mobile operating system, Android.

Ovi Store starts gaining some traction as Shazam reaches 1 million downloads.

http://www.musicweek.com/story.asp?sectioncode=1&storycode=1040533&c=1
http://www.mobile-ent.biz/news/36462/Shazam-racks-up-1m-downloads-on-Ovi-Store
http://www.pocket-lint.com/news/32294/nokia-comes-with-music-rebranding

While I spend a lot of time talking about iPhone and Android apps I almost never cover the progress of other app stores. Nokia’s Ovi store, launched last year, is finally starting to gain some traction. The store, which offers apps for Nokia’s own symbian mobile operating system, announced that Shazam was the latest app to reach the 1 million downloads milestone. The store seems poised at becoming increasingly popular in 2010 as Nokia sells more and more symbian-based smartphones and although it may not yet make financial sense for smaller businesses to develop for it certainly starts to be a more appetizing market for larger players who can absorb the development costs. For example, Shazam has over 50 million customers so one million is a very small percentage, but given the scale it can still amount to significant revenues. The Ovi brand is becoming quite popular, so much so that Nokia decided to re-brand its Nokia Music Store as Ovi Music. Ovi Music will be rolled out to all Comes with Music customers around the world in 2010 and in many countries it has actually supplanted the Comes With Music brand – for example Russia, Malaysia and India. There are no plans for a re-brand in the UK where the marketing campaign for Comes With Music had been so extensive that any such move would really confuse consumers.

CBS aims at making Last.fm profitable this year.

http://paidcontent.org/article/419-interview-cbs-thinks-last.fm-will-turn-a-profit-this-year/

Robert Andrews from Paidcontent published a days ago an interesting interview with Last.fm’s Product VP Fred McIntyre – you can find it and listen to it via the link in the shownotes.
The key points are that CBS is as committed as ever to the Last.fm brand, seeing it as the only service that successfully ties in the listener’s music experience across multiple platforms and services. CBS aims at making the division profitable by 2010 by being very focused on the subscription business. Outside of the Uk, US and Germany last.fm requires a monthly subscription which currently drives about a quarter of the company’s revenues. In the interview, Mr McIntyre indicated that the number of subscribers is in the high tens of thousands. Rolling out new features for subscribers as well as enriching the way Last.fm integrates with different platforms and devices are both high on the list of priorities for the company. It seems that after a number high-profile departures last year, CBS is finally finding a way of turning things around at last.fm.

Well, that’s all for this week, i hope you enjoyed the show.

A few exciting developments for the podcast this week. First of all as I mentioned before I’ll be covering Sounds Digital in April, then at the end of May I will be covering Future Music Camp in Mannheim as well as hosting a workshop on interactive music services and I just confirmed that I’ll be at the Future Music Forum in Barcelona at the end of September. You can find links to all these events on the front page of the the site at www.digitalmusictrends.com, where you will also find links to the iTunes and RSS feeds, a contact form and other goodies.
To contact me directly with news stories, comments and feedback the email is digitalmusictrends@gmail.com and you can follow me on twitter, the handle is digimusictrends.
have a great week and ’till next time!

Digital Music Trends – Episode 39

This week: an interview with David Nelson, CTO of Muziic.com and an interview with Megan Elliot, organizer of the Sounds Digital event in London. In the news former Sony Music CEO Don Ienner unveils the IMHO media Player, Rapidshare takes a tough stance on piracy, Spotify is rumored to be set for a Q3 launch in the states, Shazam reaches 1 million downloads through Nokia’s Ovi store and CBS indicates that Last.fm may finally become profitable. 

www.muziic.com

www.sounds-digital.com

Digital Music Trends – Episode 39 by digitalmusictrends


IMO Entertainment launches IMHO, a new social media player blending music, videos, games and advertising. 

http://www.billboard.biz/bbbiz/content_display/industry/e3ibfd213a270515452350214f913243ada

http://musically.com/blog/2010/03/25/former-sony-music-boss-launches-imho-social-content-player/

http://www.pamil-visions.net/imho-cloud-content-distribution-is-a-game/213195/

http://preview.imhomedia.com/facebook_connect

http://www.prnewswire.com/news-releases/former-sony-chief-ienner-launches-imho-alpha-89013107.html

Various news outlets such as Billboard Business and Music Ally reported on the launch of the IMHO social media player this week. The player is produced by IMO Entertainment, a company lead by Don Ienner, previously CEO of Sony Music Label group and Columbia Records. The idea behind the player is that it brings together music, video and gaming under a single roof that is cloud-based and geared towards social sharing. The player’s monetization revolves around virtual money that can be purchased outright via Paypal or earned through the exposure to advertising the level of which can be customized within the player, the virtual IMHO money that can be spent to purchase content, personalize your avatar or purchase virtual goods. At the moment the player features 150 radio stations, a partnership with digital distributor the Orchard as far as the music is concerned and over 900 games provided by RealNetworks. The player is geared primarily towards Facebook users, who have demonstrated time and time again how virtual goods done right can generate a huge cash flow – see Farmville’s history for details. The idea seems certainly pretty solid, but the real problem will be finding a balance between free content and paid content. If relatively new users were to experience that the majority of the content on the player requires payment they will soon be turned off by the experience, but just like in Farmville, if enough is given away for free to get them hooked to the platform then they will probably agree to buy almost anything, no matter how daft the purchase may appear. Due to Facebook’s fundamentally unsuccessful strategy up to now in regards to content distribution of music and videos many companies are competing to create an experience that can capture the imagination of the hundreds of millions of people who use the platform every day. IMHO has now captured the industry’s attention, it’s now up to them to demonstrate whether they can live up to their own hype and reach a mainstream audience. 

Rapidshare goes all-out against piracy and wants to direct pirates to legal sites for the purchase of content. 

http://torrentfreak.com/rapidshare-aims-to-convert-pirates-into-customers-100326/ 

http://musically.com/blog/2010/03/24/rapidshare-finally-getting-tough-on-illegal-downloads/

Rapidshare, the online file storage and delivery service, has decided to crack down on piracy. The service, which has been widely known to be a sort-of safe harbor for sharing copyright protected material, interestingly decided to start cutting off accounts of known file uploaders and started issuing warning letters to downloaders, probably in a bid to avoid a crippling lawsuit by the entertainment industry. The move took many by surprise as after all Rapidshare’s business had grown dramatically thanks to its sharing-friendly reputation. Torrentfreak, though, offered a different angle on the story after unveiling a letter that was written by the company’s General Manager Bobby Chang addressed to representatives of the entertainment industries. In the letter, Mr Chang condemns new companies that are cropping up with the sole purpose of being cyberlockers for the safe exchange of copyrighted material. He also refers to infringing users as criminals and makes the interesting proposal to deny access to copyrighted material when searched for and replace it with links to sites where the users would be able to buy a legitimate copy of the same item he searched for.

 The move has got to be positive news for the music, film and games industry but ultimately pointless as many users who want to continue exchanging files without restrictions will probably just migrate to other services who may have kept a lower profile and therefore so far avoided legal problems. Although this new stance is likely to damage Rapidshare in the short term and reduce its user base it’s certainly a clever move. First of all it greatly reduces the chances of having to fight expensive lawsuits in court. Second the company has now reached millions of customers so even if some were to leave the service chances are that many would stay on and keep it a viable commercial enterprise. Third, if the re-direction of users to legitimate sources was to work I assume it would involve some sort of affiliate sales fee and that could slowly replace the revenues previously generated by copyright-infringing users. I am very interested in seeing how Rapidshare will fare in the next 12 months as the results of this gamble are at the moment completely unpredictable. 

Spotify might be aiming at a Q3 launch in the United States 

http://www.billboard.biz/bbbiz/content_display/industry/e3if745772b249372ddad2f9ebc7a21298b

http://www.businessweek.com/news/2010-03-26/spotify-online-music-site-targets-u-s-start-in-third-quarter.html

In An interview released to Bloomberg the VP of of Spotify Paul Brown hinted that the service is aiming to go live in the US in the third quarter of this year. Brown said that Spotify is buying server space in random parts of the United States to ensure the smooth running of the service once online and it is still ironing out the details of the licensing deals with the labels. Billboard Business writer Antony Bruno, who picked up on the story, reports that there are also fresh rumors regarding the relationship between Spotify and Google. A couple of months ago, when the Nexus One was first announced, rumor had it that it was going to feature Spotify as an embedded feature. This failed to materialize at the time – also probably because the deals with the labels are not yet finalized – but it does not mean that it won’t happen in the next iteration of the Google phone or that Spotify won’t become a more prominent feature in new versions of Google’s mobile operating system, Android. 

Ovi Store starts gaining some traction as Shazam reaches 1 million downloads. 

http://www.musicweek.com/story.asp?sectioncode=1&storycode=1040533&c=1

http://www.mobile-ent.biz/news/36462/Shazam-racks-up-1m-downloads-on-Ovi-Store

http://www.pocket-lint.com/news/32294/nokia-comes-with-music-rebranding 

While I spend a lot of time talking about iPhone and Android apps I almost never cover the progress of other app stores. Nokia’s Ovi store, launched last year, is finally starting to gain some traction. The store, which offers apps for Nokia’s own symbian mobile operating system, announced that Shazam was the latest app to reach the 1 million downloads milestone. The store seems poised at becoming increasingly popular in 2010 as Nokia sells more and more symbian-based smartphones and although it may not yet make financial sense for smaller businesses to develop for it certainly starts to be a more appetizing market for larger players who can absorb the development costs. For example, Shazam has over 50 million customers so one million is a very small percentage, but given the scale it can still amount to significant revenues. The Ovi brand is becoming quite popular, so much so that Nokia decided to re-brand its Nokia Music Store as Ovi Music. Ovi Music will be rolled out to all Comes with Music customers around the world in 2010 and in many countries it has actually supplanted the Comes With Music brand – for example Russia, Malaysia and India. There are no plans for a re-brand in the UK where the marketing campaign for Comes With Music had been so extensive that any such move would really confuse consumers.

CBS aims at making Last.fm profitable this year.  

http://paidcontent.org/article/419-interview-cbs-thinks-last.fm-will-turn-a-profit-this-year/

Robert Andrews from Paidcontent published a days ago an interesting interview with Last.fm’s Product VP Fred McIntyre – you can find it and listen to it via the link in the shownotes. 

The key points are that CBS is as committed as ever to the Last.fm brand, seeing it as the only service that successfully ties in the listener’s music experience across multiple platforms and services. CBS aims at making the division profitable by 2010 by being very focused on the subscription business. Outside of the Uk, US and Germany last.fm requires a monthly subscription which currently drives about a quarter of the company’s revenues. In the interview, Mr McIntyre indicated that the number of subscribers is in the high tens of thousands. Rolling out new features for subscribers as well as enriching the way Last.fm integrates with different platforms and devices are both high on the list of priorities for the company. It seems that after a number high-profile departures last year, CBS is finally finding a way of turning things around at last.fm. 

Well, that’s all for this week, i hope you enjoyed the show.

A few exciting developments for the podcast this week. First of all as I mentioned before I’l be covering Sounds Digital in April, then at the end of May I will be covering Future Music Camp in Mannheim as well as hosting a workshop on interactive music services over there. Finally I just confirmed that I’ll be at the Future Music Forum in Barcelona at the end of September. You can find links to all these events on the front page of the the site at www.digitalmusictrends.com, where you will also find links to the iTunes and RSS feeds, a contact form and other goodies. 

To contact me directly with news stories, comments and feedback the email is digitalmusictrends@gmail.com and you can follow me on twitter, the handle is digimusictrends

Have a great week and ’till next time! 



Digital Music Trends – Episode 38

This Week: an interview with Scott Geller from Zooz Mobile, the firm just released a new app based on tracks by the Jackson 5. In the news: Pink Floyd VS EMI, We7 partners with Yahoo, a Spotify update from Daniel Ek at SXSW, Dimensional is buying back the Orchard, a new ruling on Piracy in Spain and finally PRS for Music announces that for the first time the growth in digital revenues has offset the losses caused by the decline in physical sales.

Shownotes

Interview with Scott Geller from Zooz Mobile on Zoozbeat and the new Jackson 5 App. www.zoozmobile.com http://newzfor.me/news/23199653.aspx

Pink Floyd VS EMI

Well, the ruling in the Emi versus Pink Floyd case made some noise this week. The band, most people will be aware, never released singles as they always wanted people to hear the albums in their entirety. This was put down in writing as a clause of their contract that required the label not to sell tracks individually unless they had the band’s explicit permission. In came the digital revolution andEMI probably thought – there’s no other way to sell tracks on iTunes other than making them available individually so we’re going to run with it. Naturally the band was pretty upset by this and started a legal dispute that may well re-define the way in which old contracts thatdidn ‘t take the new digital formats into account are interpreted. This week the court ruled that the band was indeed trying to preserve its artistic integrity by including that clause and that the label should not have started selling the albums digitally without the band’s prior consent. For now the ruling only hadEMI pay for the costs incurred by the band, about £40,000, and did not require the label to remove the band’s music from digital stores but that, is suggested, may come at a later stage. I personally can’t believe that EMI thought they’d get away with it simply by pointing out that digital distribution didn’t exist at the time of the signing of the contract and therefore should not abide by the same rules. After all the talk about piracy and about how stealing a song online is just like stealing a handbag in the street or a CD in a music store, how can they go to court and make a case that states that physical products are nothing at all like digital ones? Naturally their hands were tied, Apple’s unwillingness to bundle albums took away the choice from the artist. I personally still don’t get Apple’s stance. I’m sure that if they did let artists choose whether to allow for individual track sales or not the market would then dictate which of the two is right and goes on to achieve more sales overall. If an artist or label only does that because the album’s poor and only the single is any good, like they were doing with CD’s in the 90’s then people will not buy it. If otherwise the album’s good then they will. In any case whether or notEMI decides to pull Pink Floyd’s music from iTunes before a court makes them do it, I’m sure that there are plenty of people out there who would still be willing to go to an alternative online store in order to be able to buy Dark Side of the Moon in its entirety. It’s just a shame that smaller artists who would like the same artistic freedom to sell their album as a complete hole are not afforded the same chance of success if they decide to pull their music fromiTunes, which after all does still have a vast majority share in the digital domain.

Spotify’s Daniel Ek reveals subscriber numbers and talks about the US market. http://digital.venturebeat.com/2010/03/16/spotify-daniel-ek/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+Venturebeat+(VentureBeat)

There was some more Spotify news today straight from the main man Daniel Ek. Digital Venture beat reports that the CEO speaking at South By South West stated that the company now has 7 million users across Europe and 320,000 paying subscribers. This is an encouraging number that has been rising steadily over the past few months. ApparentlySpotify is still very committed to the North American market, which could afford them an audience almost twice as large as in Europe. MrEk though did not reveal anything in terms of a forthcoming US launch date, stating that dealing with over 5,000 individual publishers in the states turned out to be much more time consuming than the licensing process in Europe. The company is continuously developing its applications to take them one step further but it has no intention of becoming a social network in itself and would rather use existing social network in order for people to exchangereccomendations and play-lists.

My main problem with Spotify premium and We7 Premium at the moment is  the lack of multitasking on the iPhone. It may sound like a small problem, but the times in which I want to listen to music on my phone are the times when I’m outside the house, and in those times I want to be able to check my emails, update my twitter, look at a map without having con continuously interrupt my music then spending several seconds getting it back on track. In this form I personally find the app almost unusable unless I’m going for a jog or something that does not allow me to stop and use mysmartphone as a smartphone . But then again this problem is limited to iPhone users and moving onto android might be the key to enjoying these subscription services a bit better…

In any case it will be very interesting to see Spotify launch in the US at some point in the future. In the States there are already quite a few subscription services on the market offering similar services and I wonder as to whatSpotify can bring to the table that will draw consumers to its service.

We7 strikes an ad deal with Yahoo http://paidcontent.co.uk/article/419-yahoo-takes-on-we7s-ad-sales-could-take-more/

Paid content and Music Ally report that we7 has struck a partnership with Yahoo that will see the music streaming service outsource to Yahoo all of its visual adverts. This according to Paid Content will give them a greater clout when dealing with advertising partners. The move comes just less then three weeks after We7 launched its subscription service and iPhone apps, and it shows that We7 is committed to making sure that the free ad-funded streams are monetized just as much as the paid subscription streams. The company does not want to see the free streaming service as a loss leader to drive subscriptions but as a service in its own right that can be a viable business model. The company has been tweaking its advertising model over the past few months as more changes are on the way. For example the company announced that it’s looking at moving from the 10 seconds audio adverts it employed so far to longer, radio-style adverts that could be as long as 20 or 30 seconds. We7 Operates only in the UK and as far as anyone can tell there are no plans to export the service elsewhere yet. The company has always said that they wanted to make sure the service was fully monetized before trying to expand its horizons. CEO StevePurdham also stated that the partnership with Yahoo could extend beyond visual advertising to encompass content deals as well, so that would be an interesting development certainly worthy of note.

A couple of days ago JDS Capital’s private equity arm Dimensional Associates announced its intention to buy back the share of the Orchard that it didn’t own. The company, which also ownes eMusic, was the sole owner of the Orchard up to 2007 and has now offered to buy the part it no longer owns for 2.05 dollars per share, thus valuing the indie distributor at 12.77 million dollars. The contract includes a 30 day go-shop period where other buyers could sweep in and make a higher offer and it is subject to stockholder’s vote. The contract also includes a provision that would allow stockholders to get a bonus on top of the agreed price if 80% or more of the company was to be sold by Dimensional within 6 months. This clause has led to speculations that the Orchard is only being bought in order to be sold off again, whilst others think that Dimensional will try to merge the Orchard andeMusic into a single entity. In any case the Orchard is a major player in the indie digital distribution arena and these developments are likely to have a significant impact on the market.

A Spanish judge rules that linking to P2P is not illegal

Billboard business reports on the latest court ruling coming from Madrid that is set to reinforce Spain’s liberal stance in regards to online piracy. At the center of the dispute this time was the websiteelrincondejesus.com which contained links to eDonkey. The site had been taken to court by Spain’s powerful collection society SGAE . The judge ruled that since the site was merely an index that facilitated the research within P2P networks it could not be held liable for the files it was linking to and went on to detail that if that was the case then Google would be liable too because it offers access to similar sorts of links through its search engine. This is certainly not great news for those who are lobbying for anti-piracy measures to be adopted in Spain. The Spanish government had already said that it’s not going to target individual users and was thinking of introducing laws targeting sites that made illegal content available – but it looks like that sort of law in the current climate would only apply to sites that were actively hosting the content and not linking to it – and such sites are few and far between. Such a measure therefore would be unlikely to have any impact at all on the piracy phenomenon in Spain.

PRS for music reveals that digital revenues growth has finally offset the loss caused by the decline in physical sales. http://paidcontent.co.uk/article/419-digital-music-sales-are-booming-but-industry-still-cites-piracy-woes/ http://paidcontent.co.uk/article/419-spotifies-mean-online-now-filling-uks-cd-royalty-gap/

And finally, UK collection society PRS or Music gave the industry signs of hope as for the first time ever the growth in revenue on the digital front managed to offset the loss of revenue caused by the progressive decline of CD sales. Digital revenues increased by 12.8 million and physical ones declined by 8.7. This naturally only reflects the royalty incomes to songwriters, composers and music publishers and not the labels’ revenues. In this scenario there was no word as to how much streaming services likeSpotify and We7 contributed to this surge in digital revenues. We can only hope that next year’s figures will show that on both the collection society’s and the label’s front that digital has finally managed to compensate the loss for physical sales. I believe that can be achieved simply by offering real value and great services to the consumers and not simply by imposing a complicated and hard to implement legislation to tackle and contain the piracy problem.

Digital Music Trends – Episode 38

This week on the show an interview with Scott Geller, CEO of Zooz Mobile. The company has just announced at SXSW a new iPhone app based on five tracks by the Jackson 5.

In the news: We7 strikes and ad deal with Yahoo, Pink Floyd prove that digital is not above board when it comes to respecting a contract, Spotify claims 320,000 paying subscribers but does not give anything away regarding its US launch date, Dimensional is buying back the Orchard, a Spanish judge rules that linking to P2P is not illegal and finally PRS for Music reveals that for the first time ever last year in the UK the rise in revenues generated by online distribution has offset the losses caused by the decline of physical sales.   Digital Music Trends – Episode 38  by  digitalmusictrends

Shownotes

An interview with Scott Geller from Zooz Mobile on Zoozbeat and the new Jackson 5 App. 
www.zoozmobile.com
http://newzfor.me/news/23199653.aspx

 

Pink Floyd VS EMI

http://news.bbc.co.uk/1/hi/entertainment/8561963.stm

Well, the ruling in the Emi versus Pink Floyd case made some noise this week. The band, most people will be aware, never released singles as they always wanted people to hear the albums in their entirety. This was put down in writing as a clause of their contract that required the label not to sell tracks individually unless they had the band’s explicit permission. In came the digital revolution and EMI probably thought – there’s no other way to sell tracks on iTunes other than making them available individually so we’re going to run with it. Naturally the band was pretty upset by this and started a legal dispute that may well re-define the way in which old contracts that didn’t take the new digital formats into account are interpreted. This week the court ruled that the band was indeed trying to preserve its artistic integrity by including that clause and that the label should not have started selling the albums digitally without the band’s prior consent. For now the ruling only had EMI pay for the costs incurred by the band, about £40,000, and did not require the label to remove the band’s music from digital stores but that, is suggested, may come at a later stage. 
I personally can’t believe that EMI thought they’d get away with it simply by pointing out that digital distribution didn’t exist at the time of the signing of the contract and therefore should not abide by the same rules. After all the talk about piracy and about how stealing a song online is just like stealing a handbag in the street or a CD in a music store, how can they go to court and make a case that states that physical products are nothing at all like digital ones? Naturally their hands were tied, Apple’s unwillingness to bundle albums took away the choice from the artist. I personally still don’t get Apple’s stance. I’m sure that if they did let artists choose whether to allow for individual track sales or not the market would then dictate which of the two is right and goes on to achieve more sales overall. If an artist or label only does that because the album’s poor and only the single is any good, like they were doing with CD’s in the 90’s then people will not buy it. If otherwise the album’s good then they will. In any case whether or not EMI decides to pull Pink Floyd’s music from iTunes before a court makes them do it, I’m sure that there are plenty of people out there who would still be willing to go to an alternative online store in order to be able to buy Dark Side of the Moon in its entirety. It’s just a shame that smaller artists who would like the same artistic freedom to sell their album as a complete hole are not afforded the same chance of success if they decide to pull their music from iTunes, which after all does still have a vast majority share in the digital domain. 

Spotify’s Daniel Ek reveals subscriber numbers and talks about the US market. 
http://digital.venturebeat.com/2010/03/16/spotify-daniel-ek/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+Venturebeat+(VentureBeat)

There was some more Spotify news today straight from the main man Daniel Ek. Digital Venture beat reports that the CEO speaking at South By South West stated that the company now has 7 million users across Europe and 320,000 paying subscribers. This is an encouraging number that has been rising steadily over the past few months. Apparently Spotify is still very committed to the North American market, which could afford them an audience almost twice as large as in Europe. Mr Ek though did not reveal anything in terms of a forthcoming US launch date, stating that dealing with over 5,000 individual publishers in the states turned out to be much more time consuming than the licensing process in Europe. 
The company is continuously developing its applications to take them one step further but it has no intention of becoming a social network in itself and would rather use existing social network in order for people to exchange reccomendations and play-lists. 

My main problem with Spotify premium and We7 Premium at the moment is  the lack of multitasking on the iPhone. It may sound like a small problem, but the times in which I want to listen to music on my phone are the times when I’m outside the house, and in those times I want to be able to check my emails, update my twitter, look at a map without having con continuously interrupt my music then spending several seconds getting it back on track. In this form I personally find the app almost unusable unless I’m going for a jog or something that does not allow me to stop and use my smartphone as a smartphone. But then again this problem is limited to iPhone users and moving onto android might be the key to enjoying these subscription services a bit better… 

In any case it will be very interesting to see Spotify launch in the US at some point in the future. In the States there are already quite a few subscription services on the market offering similar services and I wonder as to what Spotify can bring to the table that will draw consumers to its service. 

We7 strikes an ad deal with Yahoo
http://paidcontent.co.uk/article/419-yahoo-takes-on-we7s-ad-sales-could-take-more/

http://musically.com/blog/2010/03/16/we7-signs-display-advertising-deal-with-yahoo/

Paid content and Music Ally report that we7 has struck a partnership with Yahoo that will see the music streaming service outsource to Yahoo all of its visual adverts. This according to Paid Content will give them a greater clout when dealing with advertising partners. The move comes just less then three weeks after We7 launched its subscription service and iPhone apps, and it shows that We7 is committed to making sure that the free ad-funded streams are monetized just as much as the paid subscription streams. The company does not want to see the free streaming service as a loss leader to drive subscriptions but as a service in its own right that can be a viable business model. The company has been tweaking its advertising model over the past few months as more changes are on the way. For example the company announced that it’s looking at moving from the 10 seconds audio adverts it employed so far to longer, radio-style adverts that could be as long as 20 or 30 seconds. We7 Operates only in the UK and as far as anyone can tell there are no plans to export the service elsewhere yet. The company has always said that they wanted to make sure the service was fully monetized before trying to expand its horizons. CEO Steve Purdham also stated that the partnership with Yahoo could extend beyond visual advertising to encompass content deals as well, so that would be an interesting development certainly worthy of note. 

 

Dimensional is buying back the Orchard 
http://www.hypebot.com/hypebot/2010/03/dimensional-buys-back-the-orchard.html
http://paidcontent.org/article/419-emusic-owner-dimensional-buys-the-orchard-valued-at-12.77-million/

A couple of days ago JDS Capital’s private equity arm Dimensional Associates announced its intention to buy back the share of the Orchard that it didn’t own. The company, which also ownes eMusic, was the sole owner of the Orchard up to 2007 and has now offered to buy the part it no longer owns for 2.05 dollars per share, thus valuing the indie distributor at 12.77 million dollars. The contract includes a 30 day go-shop period where other buyers could sweep in and make a higher offer and it is subject to stockholder’s vote. The contract also includes a provision that would allow stockholders to get a bonus on top of the agreed price if 80% or more of the company was to be sold by Dimensional within 6 months. This clause has led to speculations that the Orchard is only being bought in order to be sold off again, whilst others think that Dimensional will try to merge the Orchard and eMusic into a single entity. In any case the Orchard is a major player in the indie digital distribution arena and these developments are likely to have a significant impact on the market. 

A Spanish judge rules that linking to P2P is not illegal

http://www.billboard.biz/bbbiz/content_display/industry/e3ic04432c02b78974418f501fb06f70ea2

Billboard business reports on the latest court ruling coming from Madrid that is set to reinforce Spain’s liberal stance in regards to online piracy. At the center of the dispute this time was the website elrincondejesus.com which contained links to eDonkey. The site had been taken to court by Spain’s powerful collection society SGAE. The judge ruled that since the site was merely an index that facilitated the research within P2P networks it could not be held liable for the files it was linking to and went on to detail that if that was the case then Google would be liable too because it offers access to similar sorts of links through its search engine. This is certainly not great news for those who are lobbying for anti-piracy measures to be adopted in Spain. The Spanish government had already said that it’s not going to target individual users and was thinking of introducing laws targeting sites that made illegal content available – but it looks like that sort of law in the current climate would only apply to sites that were actively hosting the content and not linking to it – and such sites are few and far between. Such a measure therefore would be unlikely to have any impact at all on the piracy phenomenon in Spain. 

PRS for music reveals that digital revenues growth has finally offset the loss caused by the decline in physical sales. 
http://paidcontent.co.uk/article/419-digital-music-sales-are-booming-but-industry-still-cites-piracy-woes/
http://paidcontent.co.uk/article/419-spotifies-mean-online-now-filling-uks-cd-royalty-gap/

And finally, UK collection society PRS or Music gave the industry signs of hope as for the first time ever the growth in revenue on the digital front managed to offset the loss of revenue caused by the progressive decline of CD sales. Digital revenues increased by 12.8 million and physical ones declined by 8.7. This naturally only reflects the royalty incomes to songwriters, composers and music publishers and not the labels’ revenues. In this scenario there was no word as to how much streaming services like Spotify and We7 contributed to this surge in digital revenues. We can only hope that next year’s figures will show that on both the collection society’s and the label’s front that digital has finally managed to compensate the loss for physical sales. I believe that can be achieved simply by offering real value and great services to the consumers and not simply by imposing a complicated and hard to implement legislation to tackle and contain the piracy problem.

Digital Music Trends – Episode 37

This week: an extensive interview with Jay Frank, author of Future Hit DNA. Check out www.futurehitdna.com for more information.

Digital Music Trends – Episode 37  by  digitalmusictrends