Digital Music Trends – Episode 51

This week on the show an interview with Juuso Vermasheinä, CEO and co-founder of – a start-up based in Helsinki. In the news: more drama at Myspace as the company loses a co-president, Google my be preparing to roll out a new music service, UK Supermarket giant Tesco rumored to be developing a music locker service due to launch soon, a coalition of publishers sues Limewire to get a seat at the table in case of settlement negotiations, Sonicbids Acquires ArtistData and finally Guvera reveals its latest user figures.

Interview with Juuso Vermasheinä

And now for the news:

– Myspace loses a co-president and with Google’s ad deal about to expire things are looking bleak

On Thursday Myspace confirmed a TechCrunch article that revealed the departure of co-president Jason Hirschhorn – this marks yet another management shake-up in the company’s recently turbulent history. After the departure of CEO Owen Van Natta only four months ago NewsCorp appointed 2 co-presidents at the helm of Myspace – Jason Hirschhorn and Mike Jones. Now, with Hirschhorn’s departure – which was blamed on his desire to get back to New York for personal reasons – Mike Jones is expected to be made CEO of the company sometime soon. Many news outlets including myself on this show had expressed doubts at the time of the appointment of the two co-presidents that having two people at the helm of a company that needed a dramatic change in direction in order to survive may not have been a good choice, as a dual leadership could easily translate to compromise. Now the situation is not looking good at Myspace, with rumors that the network may be spun into a private company to limit News Corp’s losses. Billboard Business makes a really good point when it remarks that Myspace’s main asset now appears to be Myspace Music – but even they have not yet decided what kind of music service they want to become – they are not like Spotify or like Pandora and have lots of social-heavy cool features. But the problem is that with less and less people using the site for social networking purposes how are they going to expand those social features beyond their own users? TechCrunch remarks that Myspace’s lucrative search deal with Google is going to expire in two week’s time and there’s so far nothing that will replace that revenue stream – meaning that the company could soon be haemorrhaging even more money. Billboard’s piece reports that Myspace’s employees remain confident – they view saving Myspace as a great challenge but not something that is altogether unattainable.

– A CNET article by Greg Sandoval got everyone excited this week as he reported on numerous music industry sources that confirmed that Google is working on a new service for downloading and streaming music that could be introduced as early as this fall.
Should Apple be worried? Well yes and no. With Multi-tasking on the iPhone a Google Music app could certainly take off amongst Apple fans if it was introduced before Apple’s own rumoured music locker service, but at the same time we all know that Apple has a knack at presenting the users with the most seamless and simple experience especially when it comes to music. Google has been very successful in promoting music videos via YouTube but it has not yet shown that it’s able to deliver a great content platform purely for music that people will want to use. Should Spotify be worried though? Well – not as far as its established European market goes – but the launch of such a service could seriously derail Spotify’s attempts to break into the US market especially as the launch of the service keeps being postponed presumably due to disagreements with the labels.
Google started experimenting with Music-specific searches late last year – it had partnered with and I had spoken to Lala’s CEO Geoff Ralston at the time on how Google was taking this very seriously and had been testing Lala’s infrastructure for a long time before making the partnership official. As we all know though Apple acquired Lala not long after that so the music search feature ended up dead in the waters. Now it seems that a direct partnership with content owners could be the perfect solution as a new service would not rely on a third party company that could disappear anytime but it would be based around Google’s own infrastructure. To top it all off, Google acquired Simplify Media a little while ago – a service that allows users to stream content from their computer to their mobile – so it’ll be very interesting to see whether and how this service or its technology will be brought into play with in the new Google Music venture.
– Tesco set to launch its own music locker service – a chance to reach a mainstream audience?
Apple is always great at exploiting an idea when the market’s ready for it – just look at their success with the smart-phone and tablet markets.   Again this seems to be the case with music locker services. The idea is not new, there have been numerous companies offering this including for example Tunesbag that offers to this day a really good service, but it seems that with the rumored launch of an iTunes music locker the competition in this field is truly heating up. After 7Digital revealed its plans on last week’s Music Week for their own locker, now it looks like Supermarket giant Tesco is getting into this game with a partnership with Blueprint Digital that would be powering the service. Techradar, Cnet and Music week reported that Blueprint Digital’s CEO Richard Bron announced this partnership at the Futuresource Entertainment Summit in London – explaining that their aim is to shift the focus from the format to the content. So how will it work? Simple, just buy a CD in Tesco, swipe your Clubcard at purchase and the album will automatically be added to your music locker and you will be able to authorize up to 12 devices to access that particular content. So a very interesting proposition from Tesco that could become even more mouthwatering if they were to add DVDs to the equation as well. Naturally the big hurdle for Tesco is that it does not have a particularly hip image so I can’t see a huge amount of early adopters wanting to switch from their Spotify or We7 accounts. But if Tesco was able to somehow market this in the right way and hit those consumers who have a computer at home but don’t use it for digital music and are still attached to the physical CD this solution would be the easiest way to get them to enjoy their music from the cloud and join the digital revolution in a fairy seamless way. No word yet as to when and how this will be rolled out or as to whether it will be a free service but apparently Currys, Dixons and PCWorld are on board with the idea.

– Now the Publishers are going after LimeWire.

It looks like the possibility of the RIAA receiving a big lump sum from LimeWire arose the attention of the publishing industry.  The New York Times reports that a coalition of eight publishers filed a suit against Limewire for copyright infringement. The publishing industry was not really represented in the first lawsuit and they were obviously worried that should there be any settlement talks they would not get a seat at the table. They are demanding, just like the RIAA, the in my opinion insane amount of $150,000 per infringed song – that just like in the RIAA lawsuit could bring the damages to hundreds of millions of dollars. I find this whole thing an interesting legal exercise and I want to see where it ends up. Limewire clearly does not have billions of dollars to give to the recording industry so the only reason why I think they may be pushing for such high damages is to encourage any other service who may be operating in a similar way to shut down before the attention of the copyright holders shifts to them. Limewire still has a few days to make its case to the court or faces closure – they keep re-iterating that they want to launch a legal music service but frankly given all the acrimony between the recording industry and the Limewire executives I doubt they will be able to obtain the licenses they need.

– Sonicbids acquires ArtistData and plans to offer more services to its users.

So this week Sonicbids announced that is acquired Artist Data and plans to integrate the two services to give the musicians who use the site a complete set of tools not only to get that gig but also to promote it and get their message out there.
Artist Data is a company founded four years ago by Brenden Mulligan, it’s based in Chicago and has evolved to become a one-stop-shop for bands who don’t want to spend hours updating all the social networking sites and promotional sites separately. The company’s aim is to streamline that process so that you only have to enter the information once and it automatically updates everything else. Sonicbids have a strong set of tools for the artists to market themselves and to be chosen for gigs, but up to now everything else had to be sorted out by the band externally. Now with this partnership and I suspect a slow integration of the two platforms the process will be much more streamlined. Both Panos Panay – the founder of Sonicbids – and Brenden Mulligan were very upbeat about the new partnership. In a blog post Brenden announced that he was particularly excited at the prospect of having more resources to develop the Artist Data tool-sets and of being able to help over 245,000 musicians – such is the user base of Sonicbids. He will be joining Sonicbids as VP of  Strategic Development to oversee the ArtistData integration.

– Guvera reveals some figures about its user base.

And finally I’m going to wrap up with the latest figures coming from Guvera – the ad-funded Australian music service that allows users to download free MP3s. The company has announced that it has over 75,000 users, of which 40,000 are from its Australian operation and 35,000 from its US base. Guvera in case you are not familiar with the service allows companies to set up branded channels where they offer free MP3 is in exchange for the user exploring this channel and familiarizing with the brand. Apparently on average Australian users spend 5 to 7 minutes on each branded channels and the are are about 40 channels available so far. The service needs to keep a tight check on the number of users signing up as well as on the number of tracks they are allowed to download since the number of tracks that can be downloaded is directly dependent on how many advertisers are on board in a particular territory. Up to now Guvera has raised over 30 million dollars in investments and it plans to expand soon to other territories such as the UK and Europe. I must admit that the figures they revealed don’t really tell us a great deal about how much money they are making – or losing – but the fact that their catalogue of tracks keeps expanding and that they are looking to expand their operation must be an indicator that things are not going too badly for them. We’ll see whether the maths will work as well once they reach 750,000 users as opposed to 75,0000.
So that’s all for this week – I hope you enjoyed the show. An important announcement is that I’ll be on holiday all through this week and I haven’t figured out yet what kind of content I’ll be able to publish next Monday – but stay assured that I’ll figure something out and don’t be cross if Episode 52 is a little late or shorter than usual.
As always you can write in with any feedback, comment or news story the email is For the feeds, the Soundcloud player, the Digital Music Trends archives go to Don’t forget that you can also subscribe to the Podcast very simply via the iTunes store to get the latest show synchronized up to your device every single week.

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