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The use of Web 2.0 technologies in the music industry has changed the market forever, with musicians promoting themselves online and interacting directly with their fan bases. This has spelled opportunity for a new breed of digital music and media technology providers such as IODA, the Independent Online Distribution Alliance.
In a press release on their website, Starbucks has announced that
they're handing over control of their Hear Me music label to Concord Music
Group. Quoth the CEO, Howard Schultz: “As part of our ongoing transformation, we
are committed to examining all aspects of our business that are not directly
related to our core.” For those keeping score, Starbucks' "transformation"
involves the company transforming back into a coffee shop, although
this time without the burnt coffee. Following this move, Ken Lombard--the now
former head of Starbucks Entertainment--has "has left the company to pursue
other business interests." As Brooklyn Vegan points out, this announcement comes admist news
that Starbucks stock is starting to stagnate with the rest of the
economy, so he probably wasn't given much choice. Paul Kedrosky Infectuous Greed
Posted: 18 Apr 2008 04:33 PM CDT
Fascinating data out from iSuppli on iPhone usage compared to the average phone for typical tasks. Some eye-opening differences:
The big differences? Internet use -- no surprise -- and music use, where iPhone is used much more often than other devices. On the other side, hard not to wonder if people aren't noticing that the iPhone, is you know, a phone. (I'm kidding, of course -- these are percentages, not actual time allocations, but the differences are striking.)
profy.com
A major tide is shifting in the music industry as
the digital age slowly eats away at the number of CD sales in favor of
downloadable MP3s. Today, Apple has announced that the sales figures for
2007 are in from the NPD Group, and iTunes has come in as the #2 music retailer,
trailing only behind Wal-Mart.
In today's press release, Apple has revealed that more than 50 million people are now using the iTunes store of more than 6 million songs, which has sold more than 4 billion songs to date. Even more impressive are the sales for Christmas Day 2007, which Apple puts at "an incredible 20 million songs."
“We’d like to thank the over 50 million music lovers who have helped the iTunes Store reach this incredible milestone. We continue to add great new features like iTunes Movie Rentals to give our customers even more reason to love iTunes.” announced Eddy Cue, VP of iTunes.
The latest release of the iTunes software, version 7.6, has now integrated access to the service's newly launched Movie Rentals feature that allows customers to rent movies to be watched on a computer, a current iPod, an iPhone, or even on an HDTV through the use of an Apple TV device. By March, more than 1,000 movie titles should be available, including at least 100 titles in hi-def. Does Apple have it's sight set on NetFlix and Blockbuster next?
It's very impressive to see iTunes so high amongst traditional CD retailers. This goes to show how wrong industry execs were in viewing the digital age as a curse to the music industry that should be avoided. All the outrageous lawsuits against file-sharers and P2P networks still has not prevented the inevitable from happening. The success of the original Napster should have shown the RIAA in advance how customers wanted their music, and labels should have jumped to develop a legal and profitable way to provide it.
Oh well, I guess that's why the deep pockets of Steve Jobs and Apple stepped in and seized an opportunity many other were too blind to see. This is only the beginning of digital music stores rivaling CD retailers. The major success of the completely DRM-free AmazonMP3 marketplace, as well as the Zune marketplace (despite its flawed pricing structure), pretty much shows us that CDs probably won't last much longer.
Now, if only the car audio industry could catch up with the digital age and start providing more logical ways to listen to those digital files in the car, while maintaining quality. FM transmitters sound horrible most of the time, and having to control an iPod as well as the car's stereo can, at times, be too much for someone driving a car at the same time as well. Really, this is the only place I even listen to CDs anymore.
read/writeweb.com
At
the risk of jinxing things - I think it's pretty clear that there's a historic
shift underway between activities we used to engage in offline and things we now
do online. It's no surprise, for example, that CD
sales were down 20% this US holiday season while online
shopping was up 19%. That's how it works, right? People are moving from one
marketplace to another, more virtual one.
Another dataset released this weekend, however, paints a more complex picture. According to the newest study from the Pew Internet and American Life Center - the youngest, most affluent and most internet-connected adults in the US are also the most likely to visit a physical library. It wasn't that way just 10 years ago. How many other legacy industries can you think of today that can say their strongest growth is among young, affluent, power-internet users? Something is going very right in library land. The music business ought to pay close attention to what's going on there.
As many librarians (and perhaps the most savvy people in the music business) can tell you, the internet does not have to replace offline activities one-to-one, as a zero-sum game. Both planes, if you will, can provide essential value ads to each other - and thus "make the pie higher," as they say.
The Pew study found that 62 percent of Americans aged 18-30 are active library users, the percentage drops sharply at age 50 and falls to 32 percent of those 72 and up. Library use is highest, the study found, among young people who have internet access at home. Just a handful of years ago it was widely believed that home internet access would be the death of the public library.
CNN's coverage
of the study is excellent and includes the following:
"It was truly surprising in this survey to find the youngest adults are the heaviest library users," [Pew director Lee] Rainie said. "The notion has taken hold in our culture that these wired-up, heavily gadgeted young folks are swimming in a sea of information and don't need to go to places where information is."
Leigh Estabrook, a retired professor of information science and sociology at the University of Illinois, said young adults used to finding information online are likely to crave even more and realize they need to turn to libraries to get it.
Rainie added that young adults are the ones likely to have visited libraries as teens and seen their transformation into information hubs, with computers and databases alongside stacks of printed books.
Earlier this month we ran a post here titled Sexy Librarians of the Future Will Help You Upload Your Videos to YouTube. In that post we discussed Jon Udell's theory that librarians of the future could play a key roll in facilitating the rise of User Generated Content online.
Whether that vision is truly futuristic or something many librarians are already doing, libraries are clearly offering the kind of added value that bookstores, mom-n-pop stores and other struggling markets are trying to use to survive the coming of the internet. Events and human customer service are two things that all of these institutions can offer.
Things that libraries are unique in offering, though, include well organized information, direct access to people with unusually strong internet skills (your librarian can probably Google circles around you, for example) and an oasis of braininess in an increasingly insipid culture of nihilism.
It's been years since I was a mini-librarian (GovDocs reference as work study!) so I won't pretend to be up on the state of the art - but there are plenty of Library 2.0 blogs online to get a taste of the field.
It is clear, however, that the library still has a lot to teach us about thriving in this digital era. Traditional institutions and the Internet can have symbiotic relationships, each making the other stronger and more important than ever.
Img credit: The Guitar Heroes of the American Library Association's Midwinter 2007 conference. CC by Flickr user Libraryman. Note: I feel funny about the focus on "affluent young people" in this post as yuppie kids in the library isn't the goal, thank goodness, but I'm drawing a comparison with the private sector. Note the limitations of the analogy.
techcrunch.com
The signs are everywhere that a revolution is taking place in music. DRM is history, the price of music is falling towards zero (and sometimes even free isn’t enough to slow piracy), and even big music sites like Yahoo are beginning to break ranks with the RIAA and labels.
But Amazon may be doing more than anyone else to change the way music is
discovered, promoted and sold. Not only do they have a music store that only
sells DRM-free music, but they are experimenting with startups who are
trying to break the stranglehold that labels have on discovering, promoting and
marketing new artists. These startups are giving artists a different path to
find their fans. And Amazon is helping them.
Today Amazon announced
that it is partnering with a European startup called SellABand and will
sell music from SellABand artists. We first
covered SellABand in August 2006 - unknown artists upload music to the site
and ask fans to chip in $10 if they like what they hear. Once the band gets to
$50,000 they’ve proven themselves, and they get to record a CD in a professional
studio. Each fan gets a limited edition CD. If the artist doesn’t reach $50,000,
the fans can get their money back or give it to another artist.
Earlier this year we noted that the model seems to work. Today, more than 6,000 artists have uploaded music to the site, and a lucky few have been picked by fans to record albums. The top artists will now have their music sold on Amazon UK as well, making the model even more attractive.
See our coverage of Strayform, a different startup with a variation on the SellABand business model.
Amazon
also invested in a different startup in the music space - Amie
Street. Amie Street is a company I have long admired - we first covered it
in July
2006, and last year I added it to my list
of “web 2.0 companies I couldn’t live without.”
Amie Street has a model for selling non-DRM music that simultaneously earns artists money and ranks artists by popularity of downloads. All songs start at free. As users begin to download a song, the price rises steadily until it reaches $0.99. So the more a song costs, the more popular it is. Most of the muck is filtered out by $0.25 or so, and the site has some really excellent music. Even some well known artists have tried it out.
Amie street says that the average first time purchase on the site is close to $10. Members spend an average of nearly 8 minutes on the site each visit, listening to some of the 850,000 songs available for download. They also recently inked a deal with CDBaby, where those artists can get their music ranked on Amie Street. And they just opened a Japanese version of the site that is selling anime as well as music.
OurStage, a Boston based startup we recently covered, has yet another way of ranking indie bands.
What’s similar about SellABand and Amie Street is that both startups remove the need for a label to “discover” new artists and promote them in the hope that they sell CDs. Instead, the crowd is deciding what they like and showing it by donating to the artist (SellABand) or downloading songs (Amie Street). If either succeeds, they’ll have Amazon at least partially to thank.
With the rise of MP3s and other forms of downloadable music,
the venerable mixtape, which Wikipedia says
gained mass popularity in the 1980s, may be going the way of the dodo. It is,
afterall, rather hard to give someone an iTunes playlist, not to mention a whole
lot less romantic (if that's what you're after). But New York-based Mixaloo isn't about to
let the mixtape die.
Mixaloo revives the art form of mixtape creation by packaging mixtapes as flash widgets that you can spread via social networks or blogs. These "digital mixtapes" are powered by Clearspring, and while they don't play full songs (just samples), they do something arguably better: they can make you money.
The Mixaloo widget doesn't just show off you smooth musical taste, but also acts as a mini-store front from which your peers can purchase your creations. We created a Bob Marley-heavy mix (embedded below) that has 14 tracks -- Mixaloo puts that at a $15.22 price point. Mixaloo offers a 50-50 profit share (or about 20-40 cents per song) with mixtape makers. Mixaloo also offers a points system. Users earn points for doing things like selling tracks, and recommending related artists that the app suggests during mixtape creation. Points can be redeemed for things like Mixaloo merchandise and audio equipment.
Mixaloo entered public beta just a couple of weeks ago, and though mixtape creation is easy and I was very impressed by the sheer amount of albums and songs it has listed -- more than 3 million of them (including many obscure live tracks that other music services tend to overlook), there were some hiccups.
For example, when trying to get the embed code for my widget, I often got an error saying the widget could not be found -- especially after trying to change the widget's colors or theme. Further, though I got Mixaloo to accept my uploaded cover artwork, it is nowhere to be found on the widget itself. And speaking of the widget, every time I have tried to purchase my mix, it asks me to create an account -- I already have an account, but there appears to be no way to log in with it from the widget!
The downside of having so many songs in the library, is that Mixaloo has to offer songs protected by Windows Playsforsure DRM. Yuck. It would be great if Mixaloo could offer DRM free tracks from record labels that are open to the idea (like EMI). With the public's growing distaste for DRM could potentially hamper the growth of the service, but it is a necessary evil if you want to work with most of the major labels.
It's probably premature to say that Apple is losing any sleep over Mixaloo (and the services aren't really comparable, as iTunes sells to people looking for specific tracks, while Mixaloo hopes to sell people based on the recommendations of their friends). But speaking of making money on the long tail, Mixaloo is a perfect example of a business whose approach to utilizing the long tail is smart. They're using the distributed nature of social networks and blogs to promote music sales virally to a massive audience on a personal level.
"We created Mixaloo to merge that experience with the viral nature of blogs and social networking communities, giving users the added incentive of earning cash for popular mixes. This 'social record store' creates a vast network of personal recommendations to increase sales and visibility for artists of all sizes," said Mixaloo CEO Mark Stutzman. Work out the bugs and Mixaloo could make be a winner.
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