New stats show unsure future for mixed model
The latest Spotify stats show a mixed forecast for the the digital music service, as the number of users has increased substantially, both free and paid subscribers, but significant losses continue. The biggest contributing factor to the hefty costs comes from licensing fees for content, and while continued increases in users (and a U.S. launch) might help the company turn a corner, as Matt Rosoff reported, the startup may be in a particularly tough spot being a hybrid model that has both ad-supported and subscription options. He points out that rights holders calculate royalty payments at a rate for either one or the other, not both – the subscription rate being higher. So if Spotify is paying the higher royalty rate for all of its users, not just the paying ones, can they sustain such heavy payouts?… While EMI has received the brunt of public scrutiny in recent times, all four major music groups are amid a transition phase, with initial shake ups already happening and most predicting much more to come. After last week’s Hollywood Reporter piece, which picked apart Epic Records recent struggles under exiting Amanda Ghost at length and had Sony Music chairman Rob Stringer going on record about his failed decision to bring aboard the songwriter as label president, the industry chatter has ramped up about the impending new guard at Sony. Whether or not the new CEO will come from within the Sony ranks is still unclear, though most don’t expect the younger Stringer will be named to the top spot, leaving many to wonder if a dark horse will emerge as Rolf Schmidt-Holtz‘s successor in the end… Elsewhere, Primary Wave Talent Management, who recently grabbed a high-profile client in Cee Lo Green, has announced that writer/producer manager Tom Maffei will head up the independent publisher’s new management efforts on the West Coast… Downtown Music, who is also seen as positioning itself to shift toward increased management operations, has upped Michael Pontecorvo to oversee label operations and development… And ahead of Kanye West‘s latest release, his manager talks to The Daily Beast about the business strategy and development to expand Kanye Inc…
