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DIGITIAL MUSIC NEWS WEEK IN REVIEW

• RealNetworks made the biggest news this week, announcing a new portable subscription service. The company also improved its Harmony transcoding software, promising that its downloads are once again compatible with every iPod model.
• Sony BMG and Warner Music Group publishing unit Warner/Chappell inked a new alliance, opening the door for quicker licensing of new tracks for new digital technologies.
• Coldplay got off to a strong start online, with its single "Speed of Sound"
• topping iTunes Music Store rankings in every country. The EMI group will release its album June 6th.
• In the portable mp3 space, both Creative and iRiver suffered big net losses, with heavy price chopping leading to the declines. Meanwhile, SanDisk is hitting some unexpected success, quietly leveraging its substantial retailer relationships to support a recent mp3 player expansion.
• In satellite radio, both XM and Sirius reported strong revenue and subscriber increases in the latest quarter. But overall losses continued, with XM the only one in the pair to narrow the gap.
• In mobile music, Nokia revealed plans to introduce a 4GB music phone, with PC-transfers and over-the-air downloads supported. The N91 will rollout worldwide by the end of this year. On the content end, MTV announced a new relationship with China Mobile, part of an overall global expansion for the Viacom cable channel.
• Infinity has made a big move into podcasting, converting a money-losing AM station in San Francisco into a podcast-only broadcast.
• And the RIAA remained on the offensive, ending the week with 725 new lawsuits.

From Digital Music News.

Canada's Indie Pool And Sounscan Unite To Help Indy Acts

Canada's Indie Pool and SoundScan have agreed to expand their relationship in order to more accurately track and report Canadian independent music sales. SoundScan understands that most unsigned music sales do not take place at retail and are therefore invisible to the music industry. After months of discussion and programming, we are proud to finally announce to you that your RETAIL SALES, ONLINE SALES and LIVE SALES can now be reported to SoundScan. Don't let your sales go unnoticed!

Click here for details.

Click below for more about Sounscan

All Podcast AM Station For SF

In a case of the tale wagging the dog, Infinity Broadcasting is taking an underperforming San Francisco AM talk tadio station and transforming it into an all podcast station broadcasting a potpourri of shows created for podcast created by their listeners.  It's an interesting concept and since they aren't paying the amatuer content providers, it's a low risk one.  Learn more at www.KYOUradio.com

Read a SF Chronicle piece on the new station here.

Live365 COO Rags Gupta occassionally blogs on the current state and future of all forms of internet broadcasting.  He's a bit wordy, but if net streaming and/or podcasting is your thing, you can't deny the importance of the opinions of this smart operator of one of the world's most listened to internet broadcast networks.  Read it here.

CD Sales Weak. Can Springsteen And The DualDisc Save It?

From Digital Music News: "Soundscan figures for the most recent week showed a slight improvement, inching up 4% over previous week numbers...with weekly units approaching 10 million without a major smash album. But compared to same period totals from 2004, the story is still disappointing, with total sales in 2005 lagging behind the mark by 9.9%..."

"The Springsteen release, Devils & Dust, will be the most high profile DualDisc release to date and a big test for the format. Whether the combined CD/DVD discs will pump new life into a sagging retail story is unclear, though certainly big backing is coming from executives like Sony BMG CEO Andy Lack. Meanwhile, the continued mediocrity at retail could be a big issue for the imminent Warner Music IPO, with questions looming over just how much profitability is ahead for the company."

Nokia Announces New Music & Video Enabled Phones

At least 10 times a day we hear stories of music and entertainment companies scrambling to take advantage of what is certain to be the next wave of music delivery and promotion opportunities: the cell phone.

In a move matching recent cell phones promised from Motorola, Nokia today upped the stakes by announcing a new line with advanced features including hard drives, improved cameras, video, and music storage.

According to a company press release the N91 can store 3,000 songs on its four-gigabyte hard disk, a capacity similar to that of Apple Computer's iPod Mini and will go on sake by the end of this year. The N70, Nokia's smallest so-called third-generation, (3G) hone will provide faster data-transmission speeds and will start selling in the third quarter.

Global mobile phone sales rose 10 percent in the first quarter, slowing from a 44 percent increase in the quarter a year earlier, according to a survey from the consulting firm Strategy Analytics according to Reuters.

The first "Nseries" handset, the N90, will go on sale within a month or two and it includes optics from the German lens maker Carl Zeiss and has a video recorder and i nternet browser. The company gave no prices.

RealNetorks Vs. Apple: The Portability Wars Continue

RealNetworks has "quietly been updating its Harmony interoperability software..,. (and) Real a-la-carte downloads will once again work with every iPod model, even after various Apple firmware upgrades." according to Digital Music News and others. 

Several label execs and other industry figures have also been chiding Apple to open up it's format, rightly stating that the lack of incompatibility of various downloads between devices and platforms is the greatest single impediment (other than pricing) to explosive growth in the music download market.

Wal-Mart Offers Custom CD Service

According to Digital Music, "...Wal-Mart has officially unveiled its custom CD creation service, ...Users can compile 3 songs from a 500,000 track catalog for $4.62, with each additional track offered for $0.88...The service also lets users personalize the CD title and create customized album artwork from a selection of images. Once the compilations are created, the finished CDs are mailed to a specified address, complete with the customized packaging."

The move is another step by Wal-Mart into digital music, though its $0.88 download store has so far failed to create a spark. But the custom CD concept avoids downloads entirely, delivering a clean CD to the recipient without any hard drive involvement. That could make waves with the massive Wal-Mart customer base, with many hesitant to toe the digital download waters..."

Hypebot:  Sounds interesting, but Walmart is, as usual, late to this game.  Now if they would only put these machines in their stores like digital photo kiosks...

Universal Sued By Two Indy Radio Promoters

According to Reuters news service two old school Indy music promoters have sued Universal Music Group for $100 million, claiming the company forced them to submit false invoices so the labels could recoup promotional costs from artists such as rapper Nelly.

The promoters, National Music Marketing of Los Angeles and Majestic Promotions of Atlanta claim they were forced to doctor invoices that then allowed Universal to bill promotional costs to artists whom the promoters never worked.

"I'm sure (rapper_ Nelly is not going to be too happy that they were taking money out of his promotion budget to pay for promotions for other artists -- money that he had to pay back from his royalties," David Cohen the plaintiff's lawyers told Reuters naming just one of the artists effected.

The lawsuit also claims that when National and Majestic refused to submit phony invoices, Universal fired them and told radio stations not to do business with them.

Read the full Reuters story here.

REAL Network's Rhapsody Announces Three New Services Including Music To Go

Real Networks and Rhapsody today announced three new enhanced music services including the free but very limited Rhapsody 25, the enhanced Rhapsody Unlimited and the new portable subscription service Rhapsody To Go. 

We're not sold that this is the future of music sales and listening, but much like Napster it's a real step in the right direction.

Read more details in the full press release here.

Yahoo!Music VP Predicts Radio's Demise

During a keynote at last weeks Radio And Internet News Summit in Las Vegas Yahoo!Music and Launchcast VP David Goldberg spoke about his companies successes and challenges as well as his vision of a drastically re-shaped marketplace for music and entertainment delivery and enjoyment.

Predicting both the demise of both the CD and music on broadcast radio, he stated, "We really want to replace broadcast radio for music discovery. We believe music will migrate off of terrestrial radio to the services we are offering because we can deliver the music consumers want, when they want it, where they want it," he explained. "CDs will be replaced by on-demand subscription services. 'Personalization' and 'community' features will be key ways we'll be able to deliver the right music to people at the right time, on devices, on a global basis."

Strong words, but words the music industry needs to pay attention to. Read more about his keynote in RAIN.

Motorola Unveils iRadio & Music Friendly Mobile Phones

Tech New World reports that "through both its partnership with Apple and its new iRadio service to be tested in the U.S. next month, Motorola is looking to expand the capabilities of its handsets, making mobile phones into multimedia platforms that allow consumers to carry their music wherever they bring their cell phones."

"Motorola, which will soon offer Apple's popular iTunes music service over some of its multimedia handsets, is also highlighting its iRadio solution -- intended to use high-speed Internet connections, Bluetooth wireless technology and affiliation with Internet broadcasters to deliver commercial-free radio through mobile handsets."

"With some additional technology and possible deals with automakers, the iRadio solution will also allow users to play their music on car stereos..."

"Motorola's multimedia moves -- being matched by a number of other satellite and wireless service providers in various forms -- are an effort to take advantage of the increased power of mobile phones, which have proved to be one of the most pervasive technologies for consumers."

"...Motorola...will sell iRadio as a subscription for less than US$10 a month, said iRadio will "mobilize" commercial-free Internet radio, giving broadcasters the ability to extend their services beyond the PC to consumers in the car and on the go."

The Gap and Josh Stone Join Forces

Digital Media News reports on some smart cross-marketing: "The Gap is well-known for using big artists...like Macy Gray, Missy Elliott, India Arie and Madonna ... Now, EMI artist Joss Stone is entering the fold...Starting April 28th, visitors of gap.com will be able to download the Stone rendition of "The Right Time," famously performed by Ray Charles and Etta James. Joss Stone will also be featured in a major television advertising campaign, with viewers encouraged to "Get the song at Gap.com..."

"The Gap is the latest big corporation to embrace digital downloads, following in the footsteps of Pepsi, Coca-Cola, McDonald's, Rayovac, and Citibank...the latest move reflects the growing importance of online marketing. That has placed the Joss Stone download front and center, offering extra promotion for both the store and artist."

Hypebot:  It doesn't hurt that Stone is young and beautiful, but you have to wonder why we don't see more of these kind of win-win cross promotions.

Internet Radio Update

There are some interesting insights in today's Radio And Internet Newsletter on current opportunities and issues in iternet radio.

Rain publisher Kurt Hanson shared that declines in "At Home" and "In Office" radio listening per person represent "an opportunity...because that's where Internet radio can reach people".

For this and more read the article here.

The Week in Review From Digital Music News

• Infinity revealed a mobile-based radio broadcasting strategy this week, joining rival Clear Channel. A target date of mid-2006 was discussed.
• Britain successfully combined its download and CD-single charts, with both formats approaching 400,000 units weekly. The BPI pointed to heavy representation from independent artists, part of an effort to downplay concerns over indie inclusion from groups like the Association of Independent Music (AIM).
• In the satellite radio space, Sirius announced a new deal with Martha Stewart, with the homemaking diva grabbing a $30 million guarantee.
• In the music destination arena, AOL struck video licensing arrangements with both Universal Music and Warner Music, opening up access to tens of thousands of major label videos.
• Meanwhile, RealNetworks started to build the story on paid subscription services, announcing its one millionth subscriber.
• And sales of pre-recorded CDs continued to lag behind 2004 levels, with the gap now crossing 10%. That adds to a tough climate for an upcoming Warner Music IPO, with the company preparing to offer 32.6 million shares within the price range of $22-$26.

NPR To Broadcast Mutliple HD Radio Side-Channels

RBR.com reports on some smart moves that National Public Radio is making to extend their reach and keep broadcast radio relevant in an increasingly competitive marketplace.  The plan also createw more channels for the exposure of new music.

"This summer, NPR will begin offering five programmed music formats to HD Radio multicasting stations: classical, jazz, electronica, triple-A and folk."

"Other program offerings NPR is developing for stations with new channels include a news and information service and formats that would serve culturally diverse audiences..."

"24 NPR member stations will begin multicasting in 2005."

Aspiring Rappers Battle Online

The LA Times reported Thursday on  "Net-cees" or rappers who engage in the "MC battles" made famous in the movie "8 Mile" over the Internet rather than in front of a crowd of fans. Aspiring rappers either post their rhymes as text or use cheap online editing software to create tracks and rap over it, then they post the track on websites like HipHopPoetry.com or RapFlava.com hosting "battle boards".

WHY WOULDN'T A SMART LABEL MARKETER SET UP A SITE FOR ASPIRING RAPPERS TO DO BATTLE WITH AN AN ESTABLISHED ARTIST?

Read  the entire article here.

RealNetworks Exceeds 1 Million Subscribers

(CelebrityAccess MediaWire) -- RealNetworks, Inc. now has more than 1 million subscribers to its premium subscription music services, including its Rhapsody service and commercial-free Internet radio services. "We've now crossed a critical mass milestone in digital music," said Rob Glaser, chairman and CEO of RealNetworks. "By offering consumers the best way to get unlimited legal access to digital music, we have the #1 digital music subscription business in America. Now, we're accelerating our growth by working with partners such as Comcast to make it really easy for consumers to get Rhapsody in entirely new ways."

RealNetworks total revenue for the first quarter of 2005 was approximately $76.6 million. This compares to the company's previous first quarter revenue guidance of $73 million to $74.5 million and represents an approximately 27% increase from $60.4 million in total revenue for the first quarter of 2004. This result also represents a record quarter of revenue for RealNetworks.

RealNetworks will hold a press conference to unveil a revolutionary new initiative in digital music and a free concert featuring multi-platinum recording artists Good Charlotte at Radio City Music Hall in New York on April 26. --Bob Grossweiner and Jane Cohen

KCRW Presents New Weekly Music Industry Commentary

LA's KCRW-FM  presents a weekly commentary about the music industry every Wednesday with commentary and  analysis by Celia Hirschman, President of Downtown Marketing, a music consulting firm in New York City.

This week's brief program comments on the need for music retailers to change with the times or become irrelevant.

Listen to the commentary here.

Toyota Understands The Importance Of Music In People's Lives

According to Digital Music News "Toyota is working on a next-generation wireless platform for future car models, with music playing an integral part. The new system, which expands on a concept created by GM's On-Star, is designed to offer drivers safety, directions, and a host of entertainment options...The system will also give drivers access to an immense library of music, with Toyota pointing to a 10,000 song celestial jukebox. According to company plans, tracks can be sampled up to three times for 40 seconds prior to purchase. That could revolutionize the automobile listening experience, with karaoke one easy lure for Japanese consumers. Currently, the system remains in R&D, with no hard release dates announced."

Cell Phone Use To Double To 3 Billion By 2010

Just in case you ever doubted the importance of the music industry working aggressively with cell phone manufacturers and cell service providers, Gartner Research has released a report predicting that the number of mobile users worldwide will double from 1.5 billion people to more than 3 billion people by 2010. 

Now that's a growing market!

Despite Pending Lawsuits Kazza Partner Altnet Inks Sublime/Silverback Entertainment Deal

"While a major court decision hangs over the head of Kazaa-owner Sharman Networks, new content deals continue to be signed. Most recently, Kazaa partner Altnet has inked a relationship with Caliplates Digital, the digital distribution arm of Silverback Entertainment. That will bring several big-name artists into the Altnet distribution system, which produces paid search results within the Kazaa P2P engine. Sublime, Fishbone, and the Long Beach Dub All Stars are just some of the artists that will get rolled into the new deal, along with a new album from Slightly Stoopid. Jon Phillips of Silverback Management was results-oriented when he spoke of the new relationship. "Slightly Stoopid currently has the #1 single on KROQ-FM Los Angeles, was just added to the west coast leg of the Dave Matthews Band summer tour and through integrated promotion via P2P, thanks to Altnet and Kazaa, we are achieving a milestone for them and our indie roster," Phillips said."

- From Digital Music News

Universal Offers Tracks Via Verizon Ringbacks

Digital Music News reports that, "Verizon has taken the ringback concept one step  forward, incorporating over 500 tracks from Universal Music into its existing service. Ringbacks, which replace the tone that callers hear while waiting for pickup, are currently offered by Verizon in Southern California and Sacramento. The new catalog addition will cross several genres, including rap, metal, alternative, and pop, with customers encouraged to download multiple tones for different callers. The tones can be downloaded from a ringback-specific site on verizonwireless.com, or users can grab tones via text messaging. Verizon offers the tones for $1.99, on top of a $.99 monthly fee.

Infinity Radio Embraces Content Rich Mobile Phone Broadcasts

From Digital Music News: "Terrestrial radio continues to eye mobile opportunities,and  with Infinity Broadcasting the latest to announce an initiative. The conglomerate stepped up discussions on its "Visual Radio" offering, following news that rival radio giant Clear Channel is also moving into the mobile space. Infinity pointed to information-rich, mobile-based radio broadcasts, with consumers viewing text data like song titles and artist names alongside streams."

"Visual Radio will update current one-way broadcasts, with HP helping to power a backend that encourages user interactivity. Purchasing opportunities will involve concert tickets, ringtones and mobile music downloads, with radio station promotions also likely to receive big tie-ins. Discussions with carriers are ongoing, though deals are yet to be finalized. Nokia is expected to rollout compliant devices by mid-2006, a target date for the service launch. Infinity, a division of Viacom, currently controls a network of over 180 radio stations."

5 Mile WiFi A Step Closer To Reality

In another move that should make mobile music listening (including via internet streaming and broadcasting) a reality, USAToday reports that "Intel, AT&T and other corporate giants are throwing their weight behind a new wireless Internet service powerful enough to send a signal more than 5 miles."

"...That corporate support is a big endorsement for the still-emerging technology, which probably won't become common until 2007, tech analysts say."

"...Support from Intel and other giants "is the big reason that (WiMax) is the real thing," says Internet analyst David Willis of researcher Gartner.

"WiMax is essentially high-powered Wi-Fi, the kind of wireless Internet now common in coffee shops. Wi-Fi's range is much shorter, usually enough to cover only one or two buildings."

"A single WiMax antenna can beam high-speed Internet to entire neighborhoods. That means it could:

- Bring high-speed Internet to hard-to-reach areas. It's expensive to run broadband cable to homes and businesses in rural areas...

- Give a wired broadband alternative...

- Offer access on the go. WiMax initially will act much like wired broadband."

Read the entire USAToday artcile here.