AmieStreet Adds Sony’s RED To Dynamically Priced Download Offering
AmieStreet has added catalog from Sony's indie distribution arm RED to its dynamically priced offering. Songs will be loaded onto AmieStreet at 15 cents and rise to a maximum of $.98 as they become more popular.Many retail experts believe that unauthorized file-sharing would decrease if music downloads were priced lower and AmieStreet's dynamic pricing model is one solution. "Community-driven pricing is an effective model for maximizing digital sales,” said Bob Morelli, President of RED. “But Amie Street is exciting precisely because it's more than just a new e-commerce model. It's a new music destination that is social, dynamic, and an engaging experience. It will be an important marketing platform for our labels and artists.”
Acknowledging the elephant in the room.
COMMENTARY: Almost daily I receive news of a deals between a distributor or record label and a music startup. But even as I report the news as exciting proof that a new music industry is finally taking shape, I am also reminded of how many of these deals are made only by ignoring fundamental legal obligations to rightsholders
From ad supported services like imeem and Spotify to radically new models like AmieStreet, the elephant in room is the statutory and contractual obligation that the labels making these deals have to songwriters and artists.
RED and their parent company Sony deserve credit for their early involvement with AmieStreet. But someone needs to start a serious conversation about changing the royalty system to fit the new realities rather than pretending that we don't have a problem. Perhaps the mighty Sony Corp. is the just the company to do it.
let’s see, so if you retail a DPD for $0.15, the retailer takes 30%, the distributor takes say 12.5%, that leaves $0.091875 for the label, and since most publishers are granting any rates for DPD mechanicals, that leaves $0.001875 for the label (imagine what the artist gets).
That makes streaming look lucrative!
You’re right. Let’s keep the price of downloads by these developing artists at the established .99 cent price point – people will say “hey, if it’s expensive, it must be GOOD! I’m going to download it right now!”
Honestly, most of these acts should probably be giving away their music at this stage of their careers. Finally someone at a major (ok, owned by a major) opened their eyes and realized that variable pricing isn’t only about charging MORE than .99 cents. Let’s hope the experiment is successful.
I wholeheartedly agree the royalty system needs serious overhaul. In Amiestreet’s case, it shouldn’t be too long before they really starts tailoring to the head of The Long Tail.
Unlike iTunes & Amazon, they attacked the true long tail material off the bat, but when you get investors involved, the major returns will only come from the labels with access to the “most popular” catalogue. On a personal note, I’d love to see Amiestreet remain “indie” for as long as possible..
For many years (1909 to 1977) the mechanical rate was two cents…I just can’t imagine publishers would agree to go back to anything near the rates of those days…
Fuck the publishers, they are more greedy and clueless than record labels. I sat in meetings for years with these neanderthals while they argued that they should get paid mechanicals for streams, because there was a temporary cached copy of the song made on a user’s computer so they could hear the song. (Ascap tried to do the reverse and get paid a Performance Right for downloads, and lost. Another bunch of clueless idiots.)
And guess what? They don’t get paid for streams, they lost that battle. With streamed services on the rise, there will be less and less need to actually download a song and pay for it, so their revenues are bound to decline – UNLESS they lower their rates to enable downloads to be priced competitively. That’s why there is continuing discussion of a “blended rate” for performance and mechanical rights.
There will be a huge gap in the perceived value between a 99 cent download, and let’s say Spotify type streaming model. Ad supported all I can eat for FREE (or a nominal monthly fee) versus one song for 99 cents? It will undoubtedly drive the price of downloads down.
Good luck to the publishers getting nine cents per song in that new world. But Ascap, BMI and Sesac will keep probably keep pushing their rates up and kill the new streaming models before they get a chance to flourish.
Its all about where the money comes out in the equation as well. If the publishing monies were removed and paid “off top” prior to retail, distr. & labels the chances of artists actually seein somethin would be increased. In this context, the issue of price point is very central to the discussion as well. Unfortunately, the old school of distribution, be it physical and or digital, puts all the responsibility on the label (or in this DIY culture, the artist themselves). And, btw, most of these digital agregators are taking waay more than 12.5%. The bottom-line is that a lower-priced DPD doesn’t make sense financially unless publishers are willing to adjust their line of sight as well. A lower-priced download is a spin-off on the long-tail, charge less, sell more. At the end of the day, if consumers do not want it, it doesn’t matter what amount downloads cost.
PS
Streaming sites should jus stick to and focus on streaming.