Global Consumers are expected to spend 32.2 billion on mobile music from ring tones to full-track downloads by 2010. This market will be lead by consumers in the Asia-Pacific area and Japan. Music for handsets spending is predicted to increase by about two and a half times this year’s prediction of $13.7 billion. In terms of use and revenue, ring tones are only second in popularity to text messaging which is No. 1. The carriers own the ring-tone business. However, they are not a strong position on the entertainment side of mobile music, such as streaming and full-track downloads. Wireless companies could lose market share to makers of digital music players, record companies and others in the field.
Archive for January, 2007
In the olden days, music distribution was a dodgy affair – guys in dingy warehouses took your product at outrageous discounts and/or under slippery payment terms. Even major record labels had a hard time getting paid, so you know it was even more difficult for indies.
The Internet, vowed to revolutionize many things, including this dismal scenario. After many years of hopeful anticipation it is finally delivering on its promise of immediate, global independent music distribution.
With entities like Itunes selling an impressive 5 million songs per day, the music download has become an acceptable way to distribute music (though the dark side is that it’s estimated that 20 to 25 million songs get traded each day for free.)
No wonder then that Rupert Murdoch who purchased MySpace last year, with a vow of his own to transform MySpace into a moneymaking machine, has just launched the MySpace music store.
Now anyone can sell their original music as downloads right from their MySpace music page. You can set your own prices but most of those currently using this service are following the traditional pricing of 99 cents per song (artists net $.54)- after you accumulate $20 they make a deposit into your account.
Surprisingly, artists have been slow to set up their MySpace stores. Anthony Burton of the Chicago band Palliard, for example hasn’t set up a store for their new album simply because he feels that adding an element of commerce into his MySpace page goes against the whole independent, non-commercial networking aspect of the site.
But as it turns out, MySpace has little to do with the MySpace music store. While the store is being touted as a MySpace service, the software comes from a company called Snocap, which gives you your own mini-store that can be inserted into your MySpace page, your homepage, or anywhere else that you can edit your html.
Snocap, the latest brainchild of Napster/file-sharing inventor
Shawn Fanning is basically a tracking service for artists and labels to find out where and when music is downloaded.
Apparently there’s nothing like multiple high-profile lawsuits to get you up to speed on the complexities of copyright law in the digital age. The 25-year-old Fanning has used his crash-course education to try and develop an online distribution solution that’s acceptable to labels, artists and music fans.
The MySpace store is only one element of a system that Snocap believes will solve the tricky issue of digital music rights in sanctioned online stores, and eventually in some file-sharing networks.
Here’s how it works: an audio fingerprint of your song is taken once you enter it into Snocap’s database. When music is requested that matches that fingerprint, Snocap checks its database and determines whether or not the file transfer is allowed and what the artist is owed for that transfer (being sure to take a small cut for themselves as well, of course).
Adhering to the “if you can’t beat ’em, join ’em” philosophy, the same people who hit Fanning with all those lawsuits are now signing up with his new company. EMI Music, Sony BMG Music Entertainment, and Universal Music Group have all made deals to have their catalogs entered into the Snocap database in the hope that they will one day get a piece of the millions of songs that are now streaming across the internet for free each day.
The catch, of course, is that the file-sharing networks have to agree to have their content filtered by Snocap and most have, understandably, not been keen on doing so. To date, only one file-sharing network, Mashboxx (still in beta), is working with Snocap to make sure that labels and artists get paid for the music that is downloaded.
But to bring it back down to the MySpace store, what does this mean for artists, or more specifically – how easy is it to set up, how much will you make and when will you see that money?
Snocap’s registration and uploading process is fairly easy. A $30 annual fee (waived for the first year) and they keep $.45 per individual download from your store, leaving $.54 for you if you charge the standard $.99 (they only take $.40 per track if a full album is downloaded.) Currently they only sell songs in MP3 or Microsoft’s DRM format.
This is a steeper fee than some services but less than others. The new Tunecore.com (also still in beta) for example, will get your music onto iTunes, eMusic and other e-retailers for a set-up fee of $.99 per song and $.99 per store, selling a song on Itunes will net you $.70 on the transaction.
However, selling songs through Tunecore on eMmusic may net you substantially less than what you’d make with your MySpace store due to a more complicated subscription based pay structure that runs something like this:
At the end of each month the total number of downloads vs the total amount of money collected determines the cost of each download.
Given most subscription plans, if people use all their downloads each month, they’re only paying maybe 25 to 30 cents per track and I assume the artist is getting some fraction of that though it’s not entirely clear what percentage they take. Then again, many people don’t use all their downloads each month and raise the average price of each download since they’re still paying the same amount.
Also, with Snocap’s service your earnings are transferred to your bank account when your balance reaches $20 (payments are sent out on a monthly basis). With Tunecore the payment plans are as varied as the stores they deal with so you may wait 3 months before seeing any money on a download.
Should you run out and set up a store? For convenience, it’s hard to beat. One could conceivably record a song and have it start earning income the next day. Where MySpace as digital music store leads to has yet to be seen, though with 2.5 million musician friends they are poised to have a major impact on the music industry. At the very least it’s comforting to know that someone is out there working to give independent artists the tools they need to get paid from their music.
Sellaband, a unique crowd sourcing site which allows emerging independent artists to take seed money from fans until they amass enough capital to record a full professional studio album, has announced its second fan funded breakthrough.
Less than four months ago Jacob Kongaika, performing under the artist name Cubworld, decided to take a chance and upload his music on SellaBand. “I saw this as a long term plan, I was thinking more in the lines of 5 or 10 years, before I would have reached my recording budget”, comments the artist. But soon after the first fans (Sellaband terms them, “Believers”) bought Parts in his future recordings, things took a different turn for Cubworld. He became one of the leading artists on SellaBand and a mere 150 days after signing up, he had acquired the full $50,000. “The last 24 hours have been really mad”, comments SellaBand Managing Director Johan Vosmeijer. “There were still 1,000 Parts left for Cubworld, which is a healthy $10,000, but they sold in less than 24 hours.”
CANNES, France, Jan. 22 — As even digital music revenue growth falters because of rampant file-sharing by consumers, the major record labels are moving closer to releasing music on the Internet with no copying restrictions — a step they once vowed never to take.Executives of several technology companies meeting here at Midem, the annual global trade fair for the music industry, said over the weekend that at least one of the four major record companies could move toward the sale of unrestricted digital files in the MP3 format within months.
Most independent record labels already sell tracks digitally compressed in the MP3 format, which can be downloaded, e-mailed or copied to computers, cellphones, portable music players and compact discs without limit.
The independents see providing songs in MP3 partly as a way of generating publicity that could lead to future sales.
For the major recording companies, however, selling in the MP3 format would be a capitulation to the power of the Internet, which has destroyed their control over the worldwide distribution of music.
Until last year, the industry was counting on online purchases of music, led by Apple’s iTunes music store, to make up the difference.
But digital sales in 2006, while 80 percent ahead of the year before, grew slower than in 2005 and did not compensate for the decline in physical sales, according to an industry report released in London last week.
Even so, the move to MP3s is not inevitable, some insiders warn.
Publicly, music company executives say their systems for limiting copies are a way to fairly compensate artists and other copyright holders who contribute to the creation of music.
But privately, there are signs of a new appreciation in the industry for unrestricted copies, which could be sold as singles or through subscription services or made freely available on Internet sites that support advertising.
The EMI Group said last week that it would offer free streaming music on Baidu.com, the leading Web site and search engine in China, where 90 percent of music is pirated. EMI and Baidu also agreed to explore developing advertising-supported music download services. This summer EMI licensed its recording to Qtrax, an ad-supported music distribution service.
Experiments by Yahoo — last year it offered a handful of tracks from Norah Jones, Jessica Simpson, Jesse McCartney and Relient K without any digital restrictions — will continue this year, David Goldberg, vice president and general manager of Yahoo Music, said in an interview at Midem. Two of the major labels, Sony BMG and EMI, agreed to the tests in 2006.
In a handful of European countries, especially in France, consumer frustration has led to government proposals to legislate interoperability.
“There is a groundswell, and I say that on the basis of private conversations,†said Rob Glaser, chief executive of RealNetworks, which sells digital music protected against piracy through the Rhapsody subscription service.
“It will happen between next year and five years from now, but it is more likely to be in one to two years,†he said.
Beginning Jan 07, the Atlanta office will host an affiliate meeting every other Tuesday called “Tempo Tuesdays†to share pertinent information and encourage collaborations amongst affiliates.
Jon-Jon Webb (Beyonce’s “Déjà vu,â€) has the current single “Turn the Page,†performed by Bobby Valentino (DTP/Def-Jam Recording Artist)
Affiliate, Nastacia “Nas Star†Kendall’s song, “Is It Me,†has been picked up for the Stacie Orrico album Beautiful Awakening (Virgin), in-stores 01/12/07.
Nastacia “Nas Star†Kendall’s song “Fallen,†has also been picked up for the Keshia Chante album 2U (Sony Urban), scheduled for Canadian release on 12/5/06 with a U.S. release in the first quarter.
New affiliate, Rod Michael (Upfront/Universal Recording Artist) has an album planned for a second quarter release.
The publishing division of recording industry giant EMI has filed a $100 million lawsuit against mobile entertainment provider InfoSpace, alleging the company and its Moviso and Premium Wireless Services subsidiaries have been underpaying royalties and selling ringtones without the proper licensing rights. In a complaint filed January 12 in U.S. District Court in New York, EMI says its auditors concluded InfoSpace was miscalculating download royalties due from Verizon Wireless and US Cellular; not reporting royalties for eight approved sub-licensees; and failing to pay royalties on EMI-owned compositions.The suit, EMI Entertainment World vs. Premium Wireless Services, 07-CV232, charges InfoSpace “engaged in a deliberate effort to frustrate and obstruct the audit rights held by plaintiffs pursuant to license agreements,” adding EMI requested an audit of InfoSpace’s books, but was met with “diversion, obstruction, misdirection and misinformation” when InfoSpace said it not have access to many of its financial records, then refused to turn them over. EMI also alleges InfoSpace is selling expressly restricted songs including John Lennon’s “Imagine,” and selling ringtones in international markets where it has not been granted formal license.
A Form 8-K report filed with the SEC on January 19 and signed by InfoSpace senior VP, general counsel and secretary Robert Easter Jr., states “The lawsuit is at its initial stages and [InfoSpace] has just begun its factual investigation. Based on its knowledge to date, [InfoSpace] believes that EMI’s claims are without merit and that it has meritorious defenses to them and intends to vigorously defend the suit.”
For more on the lawsuit:
- read this Hollywood Reporter article
Last Friday (1/19), a judge finds merit in records companies claims and rules that their lawsuit stating that XM Satellite Radio Holdings, Inc. is cheating them by letting consumers store songs can now proceed toward trial.
U.S. District Judge Deborah A. Batts found in a case brought by Atlantic, BMG, Capitol and other music distribution companies against the XM.
Last year, in a lawsuit, the record companies said XM directly infringes on their exclusive distribution rights by letting consumers record songs onto special receivers marketed as “XM + MP3″ players.
The XM attorneys have argued it is protected from infringement lawsuits by the Audio Home Recording Act of 1992, which permits individuals to record music off the radio for private use. The judge said she did not believe the company was protected in this instance by the act. In refusing to toss out the lawsuit, the judge made mention that the record companies consent to XM’s use of their copyrighted material solely for the purposes of providing a digital satellite broadcasting service.
The judge said XM operates like traditional radio broadcast providers, which cannot offer an interactive service, publish programming schedules prior to broadcast or play songs from an artist more often than specified within a three-hour period. But by broadcasting and storing copyrighted music for later listening by the consumer, the judge said, XM is both a broadcaster and a distributor but only paying to be a broadcaster.
Batts stated, “The record companies sufficiently allege that serving as a music distributor to ‘XM + MP3′ users gives XM added commercial benefit as a satellite radio broadcaster. Although XM argued in court papers that an “XM + MP3″ player is much like a traditional radio-cassette player, the judge said “it is not. It is manifestly apparent that the use of a radio-cassette player to record songs played over free radio does not threaten the market for copyrighted works as does the use of a recorder which stores songs from private radio broadcasts on a subscription-fee basis,” she said.
Reuters is reporting, that last Friday (Jan 19), the federal court denied XM Satellite Holding Inc.’s motion to dismiss the recording industry’s copyright infringement lawsuit against XM. The recording industry alleges that XM’s portable “Inno” device, which stores music, infringes on copyrights and transforms a listening radio experience into, what amounts to, a digital download service similar to iTunes.
XM’s attorney argued that the 1992 Home Recording Audio Act protected it from being sued, saying that the law shields equipment makers and consumers who make digital music recordings for private use.
“The false characterizations set forth in the plaintiff’s complaint, according to an XM spokesman said about the court’s ruling and XM remains confident that the lawsuit filed by the record industry is without merit and that we will prevail.”
Ruckus Network, Inc. has announced that through a partnership with Merit Network, Inc. it recently began providing a multimedia network that supplies free music downloads specifically for college students to Michigan colleges and universities. Merit Network, Inc. provides high speed Internet access to Michigan’s schools, libraries and higher education institutions. Throughout the year, undergraduate and graduate students will be able to access the Ruckus service anytime – on or off campus – to receive the free, unlimited and full-featured music service.
Members of the growing Ruckus community will receive access to the first college-only service that blends social networking features with a massive and continuously expanding library that is free, legal and safe. Ruckus has already proven successful at more than 100 colleges and universities across the country, including Princeton University, the University of Pennsylvania, Indiana University, Brown University, University of California-Berkeley, the University of Denver and Georgia Tech.
Through the Ruckus service, students can legally download and share music, create playlists, send personal media recommendations to friends and neighbors, browse classmates’ profiles and media libraries and meet new friends. Students can build their personal music libraries from Ruckus’ collection of more than 2.1 million high-fidelity, virus-free songs. Ruckus eliminates copyright infringement through its licensing agreements with all of the major international record labels, as well as thousands of independent labels and artists.
Merit Network selected Ruckus’ free on-campus music service offering based on student demand for the Ruckus service, the network’s robust networking infrastructure, and commitment to supporting legal, digital media services through on-campus marketing. Students at these schools will experience very fast downloads, improved network bandwidth, lower campus network infrastructure costs and access to additional video content.
“We are very excited to make our music service available to students in Michigan along with hundreds of schools across the country,” said Mairin Brzica, Director of Campus Relations at Ruckus. “Students at these schools have been emailing us for months requesting subscriptions, and we are happy to now provide a digital entertainment network and a safe and legal solution to file-sharing at no cost to students or to the school.”
“In partnering with Ruckus, we are offering students another way to connect with their campus communities, as well as a safe, legal and free way for them to obtain and share digital media,” said Don Welch, President and CEO of Merit. “It is a partnership we are very excited about, and we think our higher education community and their students will be as well.”
With the popularity of talent discovery from media outlets such as “American Idol”, the demand for talent discovery resources has climbed to an all time high. http://www.eMusicBlast.com has designed technology to help the Music Industry discover talent and generate revenue at the same time. eMusicBlast.com is the newest model in guaranteeing unsigned artists record label exposure.
RMJ Global LLC., (www.eMusicBlast.com), a fast-growing social networking & e-commerce platform, announced its new website launch. The new site was unveiled on January 1, 2007, with features and functionality that allow artists to sell music and send demos to any record label executives of their choice.
http://www.eMusicBlast.com is on the cutting edge of social networking & e-commerce solutions that have exploded over the past year. eMusicBlast.com offers its users a chance for a record deal by facilitating the submission of music demos directly to major record label A&Rs. A&R stands for “artist & repertoire”, and they are the record label executives tasked with discovering/signing new talent. The demo review service guarantees users will receive a 30+ word written review of their demo within 20 business days. In addition to the A&R demo review service, eMusicBlast allows unsigned artists and independent record labels to sell music online through the eMusicBlast.com music store.
“We wanted to design a system that uses the most powerful and proven web-based models to provide services to our users in real time,” said Richard Moore, president of eMusicBlast.com. The social networking aspect of eMusicBlast allows users to build a free professional artist or industry profile which serves as a gateway for posting images, audio and video files while networking with other members via integrated messaging technology. “The social networking aspect of eMusicBlast is what establishes our value. What sets us apart is our community combined with our e-commerce platform.” eMusicBlast.com is currently the only online service that guarantees demo reviews by top music industry A&Rs. The unique eMusicBlast.com business model blends direct e-commerce models with the social networking structure. “Our philosophy as a business is that the site contributors are the customers and vice versa. While keeping that in mind, each customer-contributor relationship should always be in a win-win scenario.” It’s a win for artists getting major record label exposure and it’s a win for record labels generating revenue while scouting new talent. “We do not interfere in the artists’ relationship with the record labels. We are only here to facilitate a place for those relationships to begin.”
For free, members have access to post audio, video, want ads, photos and events, as well as view their rankings in the top 10’s & top 100 and more. With the free membership each user is a part of the community where unlimited messaging allows users to keep in constant contact with each other. The direct e-commerce platform of eMusicBlast guarantees each user a specific result in real-time. Any member may select to purchase a demo review that guarantees them exposure to any record label A&R of their choice. The A&Rs that review demos on eMusicBlast are from major record and entertainment companies from all over the world. These A&Rs have entered into agreements to write 30+ word music reviews within 20 business days. Some of these A&Rs include Conrad Dimanche of Bad Boy Entertainment (Notorious B.I.G., P. Diddy & more), John Ozier of Curb Records (Tim McGraw, LeAnn Rimes & more) and Sabrina Montgomery of BME Recordings (Lil’ Jon, Lil’ Scrappy & more).
eMusicBlast.com has done the task of making the biggest record labels in the industry accessible to anyone with a computer. With the emergence of the community, demo review system, and electronic music sales, talent discovery now has a new outlet in a secure environment.