hypebot

Monday: Is Digital Distibution In Trouble?

THE STORY HAS BEEN POSTED HERE.

On Monday and throughout the week Hypebot will be taking an in depth look at the challenges facing digital distributors as well as layoffs and consolidations in the sector.

We'd love to hear your war stories and opinions. Email me here.

Questions Of The Week: Jay-Z and Beyonce

Did Jay Z marry Beyonce on Friday so he could include her as an asset in the Live Nation deal?


If it's a true 360 deal, did Live Nation get to choose the wedding photographer?

Hypebot's Music 2.0 Week In Review: MySpace Music, Universal Invests, U2, Job Changes & Much More

It was a week of big announcements that signaled a shift in who will control  Music 2.0.

> Hypebot named 5 Winners and 5 Losers as MySpace announced a new music store with three of the four major labels as partners.

> iTunes claims to have passed WalMart to become the #1 music retailer in the US
WalMart.com has stopped selling SonyBMG and WMG downloads.

> U2 cut a major deal with with concert giant Live Nation, but stopped short of the $150 million 360 deal Jay-Z is reportedly working on with the concert giant.

> EMI has grabbed a senior exec from Google to head its digital efforts.

> eMusic has added the Rolling Stones catalog from ABKCO.

> Music sales via video game Rock Band come close to the early days of iTunes

> Celebrity blogger Perez Hilton is boycotting SonyBMG.  Who cares?

> UNIVERSAL INVESTING: The company is investing in digital distributor INgrooves and will start using some of its software.  And Universal's Intersope joined a $25 million funding found for music social networker BuzzNet.

> Losses at The Orchard jumped even as revenues doubled. Next week, Hypebot will take an in depth look at the problems shaking up the digital distribution sector

> Danish telco TDC has begun offering free downloads with EMI, WMG and SonyBMG a part a million track catalog. 

> Napster had stronger earnings last quarter

> A 20 million song iPod may be in your future

> Universal also announced a new line of greener packaging for some of its re-releases.

> JOB CHANGES: Ian Rogers has left his gig as head of Yahoo Music for start up TopSpin and Ricall, an online music licensing marketplace, appointed former Sony ATV exec Ben Walter as head of Business Development.

Help Wanted: LA Publicity Internship

As a service to the industry Hypebot publishes free job openings and internships. Email yours here and see more opportunities on our free music industry job board.

This is an unpaid internship, for college credit only, 3 days per week (24 hours per week total) starting immediately and working through current semester. A major in publicity, journalism or a similar mass- communications program is preferred. 

It's Alive! Media is a 2-person boutique entertainment publicity firm located in Hollywood CA focusing on music, but also specializing in books and alt-lifestyle projects. The intern we seek must have an appreciation for and knowledge of the current music scene, be highly...

British ISP Bites Back "We are a conduit"

The movement demanding ISP's to shut off P2P abusers is gathering momentum worldwide. But that doesn't mean that ISP owners are going to comply. The head of Britain's 3rd most popular ISP Talk Talk has said he won't go along with the request of British labels and trade group BPI.

"We are the conduit that gives users access to the internet. We do not control the internet, nor do we control what our users do on the internet." the ISP's Charles Dunston told the BBC. "I cannot foresee any circumstances in which we would voluntarily disconnect a customer's account on the basis of a third party alleging a wrongdoing."

Wal-Mart Pulls SonyBMG & WMG Downloads

WalMart.com has gone mp3 only without product from SonyBMG and WMG.  EMI and Universal catalog has been available DRM-free on the site since late summer.  According the the site:

Wal-Mart Music Downloads Now Available in MP3 Only
We are no longer offering songs in WMA format and are focusing on bringing you the very best that music downloads can offer in the most popular format MP3.

iTunes Claims #1 Retail Spot

There must be dancing at Apple HQ as iTunes passes Wal-Mart to become the number one music retailer in the US.

Based on data from market research firm the NPD Group's MusicWatch survey that captures consumer reported past week unit purchases and counts one CD representing 12 tracks, excluding wireless transactions, iTunes became the largest music retailer in the US based on the amount of music sold during January and February 2008. Others will point to more private Soundscan data that still ranks Wal-Mart #1.

Napster Posts Stronger Quarter

Things are looking up a bit at Napster. Revenue for the quarter will reach $31 million or $127 million for the fiscal year. The fiscal quarter generated positive cash flow marking the fourth consecutive quarter of positive cash flow.  Napster' worldwide subscriber base increased to approximately 760,000 as of March 31, 2008.

But long term prospects for Napster remain mixed as the company continues to lag both in innovation and the move to DRM free. (press release)

Friday's Music 2.0 Briefing: MySpace Updates, Hein To Live Nation, $13M To OurStage & Much More

HYPEBOT FEATURES:

• Walmart pulls downloads from SonyBMG and WMG
• An in depth look at the launch of MySpace Music
• MySpace Music - 5 Winner & 5 Losers
• eMusic has added the Rolling Stones ABKCO catalog
• Napster posted stronger quarterly results
• iTunes claims the #1 retailer slot
• RockBand music sales vs. early iTunes

> MYSPACE MUSIC UPDATES:

• No guaruntee that all downloads will be DRM-free
• Indie labels will be involved

> Bill Hein who just left as head of Caroline will be heading Live Nation Artist's new recorded music division. (Billboard)

> CD sales are an improper proxy to measure the purchase demand for music. (Seeking Alpha)

> From MySpace to Live Nation, a look at the changing face of the music industry. (Hollywood Reporter)

> SpiralFrog adds tracks from digital distributor BFM. (press release) BFM also just made a Limewire deal.

> An interesting look inside OurStage's first round funding of $13 million. "If you look at the music business, the real hit rate is even worse than it is for VCs--it's one in 20, one in 30," says OurStage Inc. founder and chief executive Ben Campbell. (TechConfidential) Read Hypebots recent 4QFor interview with Campell here.

> A Visa bill has passed the US House that may make it easier for foreign musicians to toru here. (NYTimes)

MySpace Music - 5 Winners & 5 Losers

The devil is in the unrevealed and perhaps even un-negotiated details of the just announced MySpace Music joint venture with the major labels. But already some clear winners and looers are already emerging.

WINNERS:

1. MySpace - Users will stay on the site and viewing ads longer and music adds a new revenue stream.
2. SonyBMG, Universal, and WMG - They get to sell stuff where the fans already are.
3. Facebook & Other Social Networkers - This deal is not exclusive and talks with labels just got easier now that a framework is in place.
4. Music 2.0 Entrepreneurs - Thanks to Google open social indie content providers can offer competing services alongside the official offers. (or can they?)
5. Fans - The music you love and your friends all in one place.

LOOSERS:

1. Indie artists and labels - The majors are partner's in this deal; so don't assume that others will get a fair shake. Remember SnoCap?
2. imeem and iLike - They'll have to adapt or risk serving only hard core music heads.
3. EMI - Sure they'll end up joining in, but coming late to the party doesn't make them look good particularly at a time when everyone is watching.
4. Download Stores - Unless iTunes, Amazon and others start feeling more like music destinations, people (particularly young ones) will be attracted to grabbing music where they discovered it.
5. Fans - With the major labels co-owning the delivery platform; they're free to raise prices, set priorities and abuse data.

MySpace Music Launches Without EMI - An In Depth Look

MySpace and the three major labels, SonyBMG, Universal, and WMG today announced the formation of a joint venture, MySpace Music. EMI is not yet part of the deal and financial terms of the partnership were not disclosed.

The new company will launch with 30 million monthly visitors and 5 million artists as well as the audio and video library of three of the world's four largest label groups. Existing franchises including Secret Shows, MySpaceLIVE!, Transmissions, and The List will all still have a place on the new MySpace Music.

Ricall Appoints Former Sony ATV Exec

Ricall, the online music licensing marketplace, has appointed Ben Walter as Business Development Executive. Based in London, Walter will be responsible for helping strengthen this international profile. Prior to joining Ricall, Walter spent three years as Senior Marketing Executive at Sony ATV subsidiary Extreme Music and worked on synchronization licensing for broadcast and ad campaigns including Guinness, Sprite and 3 Mobile.

Earlier this year Ricall launched a partner network providing the company with a global footprint and includes North America, Germany, Austria, Switzerland, Spain, Australia, New Zealand, China, Hong Kong, Singapore, Thailand and Malaysia. In February, Ricall’s international footprint was enhanced with a global deal with EMI Music that an '07 deal with SonyBMG.

eMusic Adds Rolling Stones ABKCO Catalog

In a coup for eMusic, the DRM-free download service has the entire 28 album Rolling Stones ABKCO catalog available to its subscribers. The bulk of the material was first released between 1964 and 1969 and includes most of the bands hugely successful early input.

No official announcement has been made, but the albums are already available.

RockBand Music Sales vs. Early iTunes

This guest post comes from Nabeel Hyatt of Conduit Labs who blogs at brinking.

If you care about music, and therefore whether that business will survive, there was some pretty amazing news from Rock Band this week that didn't get the attention it deserved. MTV mentioned that Rock Band had sold 6 million downloadable tracks in its first four months of sales. And while that roughly $10-20M in additional revenue is nothing that will alter parent company Viacom's stock, the finer numbers compare favorably to the early days of iPod.

First, let's keep in mind the state of the music business. People are pirating music like crazy, and consumers that were screaming about .99 cent DRM'd tracks six months ago are screaming about the high price of .89 cent non-DRM'd tracks today. If you want evidence at how much the music industry has changed in the last 24 months, just look at Rcrd Lbl, or the deals that Last.Fm and iMeem struck with the labels. The labels expect most of their money from those deals to come from a split of ad revenue. Which is to say they expect the incremental revenue of each track to hit zero pretty soon.

So on that backdrop, Rock Band is selling totally DRM'd tracks, locked to a single platform, at between $.99 and $2.99 each. And their attach rate considering all that is amazing. For comparison:

This guest post comes from Nabeel Hyatt of Conduit Labs who blogs at brinking.

If you care about music, and therefore whether that business will survive, there was some pretty amazing news from Rock Band this week that didn't get the attention it deserved. MTV mentioned that Rock Band had sold 6 million downloadable tracks in its first four months of sales. And while that roughly $10-20M in additional revenue is nothing that will alter parent company Viacom's stock, the finer numbers compare favorably to the early days of iPod.

First, let's keep in mind the state of the music business. People are pirating music like crazy, and consumers that were screaming about .99 cent DRM'd tracks six months ago are screaming about the high price of .89 cent non-DRM'd tracks today. If you want evidence at how much the music industry has changed in the last 24 months, just look at Rcrd Lbl, or the deals that Last.Fm and iMeem struck with the labels. The labels expect most of their money from those deals to come from a split of ad revenue. Which is to say they expect the incremental revenue of each track to hit zero pretty soon.

So on that backdrop, Rock Band is selling totally DRM'd tracks, locked to a single platform, at between $.99 and $2.99 each. And their attach rate considering all that is amazing. For comparison:

Ian Rogers Leaving Yahoo Music

"After four years and three months, I’m leaving Yahoo! for another opportunity. I’ll be joining founders Peter Gotcher and Shamal Ranasinghe as the CEO at a still-mostly-stealth company called Topspin Media. Our mission is to help artists earn a living through software," Rogers wrote on his blog.

In recent months, Yahoo is has been cutting staff and fighting off a Microsoft buyout offer.  The always forward thinking Rogers seems better suited to a more entrepreneurial and innovative environment than a stalled Yahoo! Music has become.

Thursday's Music 2.0 Briefing: Jay-Z To Live Nation, Apple Passes Wal-Mart, MySpace Music Nears & More

It's a big Music 2.0 news day -

> Jay-Z is joining the Live Nation family with an expansive $150 million deal that includes tours and financing the performer and moguls new ventures. (NY Times)

> Digital takes over. Apple has surpassed Wal-Mart as the #1 retailer of music according to a memo sent to employess. (ars)

> MySpace music will launch in the the next few days with three of the four major labels. Universal is still a holdout. (LA Times)

> An extensive interview with EMI's new digital head Douglas Merrill. (PaidContent)

> Amazon debuts ordering via text message. (press release) Here's a first look. (ars)

> XM taps Quickplay for mobile Blackberry radio service. (press release)

Coalition of Independent Music Stores Charts 4/2/08

Here are the latest CIMS Top 25 Debuts, Top 50 Vinyl and Top 200 via StreetPulse

CIMS Top 25 Debuts for April 1, 2008
1 R.E.M. ACCELERATE
2 BLACK KEYS ATTACK & RELEASE
3 MORRISON,VAN KEEP IT SIMPLE
4 SWORD GODS OF THE EARTH
5 SUN KIL MOON APRIL
6 MUSE H.A.A.R.P. TOUR-LIVE FROM WEMB
7 ROLLING STONES SHINE A LIGHT
8 MOBY LAST NIGHT
9 IN FLAMES SENSE OF PURPOSE
10 GREENE,JACKIE GIVING UP THE GHOST

A 20 Million Song iPod Is Coming

Can you imagine carrying virtually every song ever recorded around in your pocket? It's possible thanks to a new compression technology being developed at the University of Rochester that digitally reproduces music in a file nearly 1,000 times smaller than a regular MP3.

"This is essentially a human-scale system of reproducing music," says Mark Bocko, professor of electrical and computer engineering and co-creator of the technology. "Humans can manipulate their tongue, breath, and fingers only so fast, so in theory we shouldn't really have to measure the music many thousands of times a second like we do on a CD. As a result, I think we may have found the absolute least amount of data needed to reproduce a piece of music."

An 80G iPod can currently hold about 20,000 songs. Multiply that by 1000 and the player could hold 20 million songs.  Finding that many tracks may actually be the hard part. The World's Largest Record Collection only boasts 6 million songs and Amazon offers a mere 4,683,676 tracks for sale.

But bring on that ISP flat tax on music. I'm feeling up for the challenge.

Google VP Merrill To Head EMI Digital. Major Challenges Ahead.

EMI has named Google’s VP of Engineering and one of its most senior global executives, Douglas Merrill, to lead its growing digital music business. As President, Digital Business, EMI Music, He will lead a new global team responsible for all of EMI’s digital strategy and global technology. Merrill starts work April 28th based on LA and will report directly to Guy Hands.

Grabbing a senior staffer from one of tech's hottest companies is a coup for Hands as he works to reshape a struggling EMI. There has been talk in the last year of major labels courting executives from tech. But perhaps because of the challenges facing the music industry vs. the larger paydays offered by technology; few have made the leap.

Why Merrill?  "I have two passions. One is creating platforms and tools that make it easier for consumers to achieve their goals. The other is music," he states. "This exciting new role at EMI is a unique opportunity for me to be able to put those two passions to work together."

But Merrill faces challenges beyond his control. His innovations are only as successful as the artists driving them, and thus far EMI has not offered new A&R initiatives. And Merrill may find that he can put his Ph.D. in Psychology from Princeton to good use at EMI. Google's corporate culture is quite different than major label's or at investment firms like EMI owner Terra Firma or Charles Schwab where Merrill worked previously.

Perez Hilton Boycotts SonyBMG. Who Cares?

FROM THE ARROGANT BLOGGER DEPT:

Popular celebrity blogger Perez Hilton is boycotting SonyBMG acts because the label is suing him over the use of song streams on his site. Sony BMG's Zomba and Jive labels, are suing Hilton for streaming several songs that turned out to be by Britney Spears.

"...These are some of our favorite musicians. It really, truly pains us not to talk about them. But, it is something we HAVE to do!

Why????

Because Zomba, which is owned by Sony BMG, is suing us and we had a lightbulb go off recently: we can't support any artist signed to Sony BMG.

Why should we help the company suing us make money???? Especially when their lawsuit is personal!

The only thing personal about this is the conversation Perez should be having with his shrink. Does Hilton really think that any of these acts are going to sell less music because he doesn't write about them?  And when Whitney Houston finally gives birth to Justin Timberlake's love child; how long will his little SonyBMG news blackout last?