Bits & Pieces: Apple’s Looming Cloud, Amazon Goes Gaga, Facebook Music & more…
Spotify & Facebook Joining Forces?
Last week saw reports that Apple has signed licensing agreements with EMI Music and Sony Music for its imminent cloud-music service, leaving Universal Music Group the sole holdout, though word seems to be that a deal is on the cusp. While many of those watching are predicting an announcement of the new service at Apple’s annual WWDC event in June, the other remaining issue is having deals in place with the major music publishing companies, which right now they don’t appear to have. According to a report on CNET, despite Apple’s previous stepping out with increased iTunes song-sample lengths without the approval of publishers that created a contentious situation, there isn’t much keeping the two sides apart on a cloud-streaming agreement… Most are already hailing Apple as the fait-accompli winner of the cloud music ‘wars’, though Amazon made a big wave this week by offering Lady Gaga’s new album Born This Way at a deeply discounted price, a move that the WSJ paints as an offensive on the iTunes digital music dominance, though Amazon is still a long way from making a dent in iTunes stranglehold. According to the article’s sources, Born This Way sold between 250,000 – 350,000 across both online marketplaces in its first day… Over the weekend news surfaced that Access Industries and Len Blavatnik’s offer for Warner Music was not the highest, a group including Sony Corp., Guggenheim Partners and Ron Perelman offered 3% more at $8.50 a share, though the deal would have been contingent on Sony board and partner approval. How this will effect the multiple shareholder lawsuits Warner is currently facing is yet to be seen… Speaking at e-G8 in Paris this week, Sean Parker made comments, as MediaMemo notes, that may explain his interest in the recent bidding on Warner Music, and could also portend future involvement in bidding on recorded music companies, an excerpt: I think that there is a pretty dramatic change in the way music is monetized that is on the cusp of happening. Back catalogues of record labels are going to become extremely valuable…If you believe this transformation is occurring, if you believe the broken distribution systems are on the verge of being fixed, those recordings are dramatically undervalued… And speaking of labels for sale, Forbes has a profile of EMI group CEO Roger Faxon, framing him as the key in the label’s recent turnaround, including major digital breakthroughs with Beatles and Pink Floyd catalogs, though his future at the company may depend solely on who the new owners will be… And is Facebook Music launching soon and on the back of Spotify?
05.19.11More Bits & Pieces: Apple Inks EMI Deal For Cloud Service; Close to Landing Sony & Universal
Apple reaches agreement with EMI for cloud-music service
The news of Apple inking a cloud-music deal with EMI Music was first reported late yesterday on CNET, and according to the industry sources the report is based on, the company is close to reaching similar agreements with both Sony Music and Universal Music Group – a deal with Warner Music was reported to have been reached last month. By now having licensing agreements with two of the four major label groups, the implications are numerous, but mainly it’s that Apple will likely once again be the driving force behind the latest shift in the digital music arena, and that Amazon and Google jumped too soon by releasing services without label deals in place… While lately the tech and music industries have been hot on the cloud-music future and closely watching developments unfold, it remains to be seen how much consumer demand there is, and on a large scale, what are people willing to pay. A new survey from Nielsen that targeted people with ‘connected devices’ (smartphones, iPads, etc), asked how much they would be willing to pay for a monthly subscription for various types of content (music, TV, movies, news, etc), and the average seems to come in right around $10/month. That falls in line with some current services that are available, and isn’t a bad number, but of course that is all in theory, and an important point to keep in mind is that an overwhelming majority of people still do not use smartphones or other high-priced ‘connected’ devices… Some attention has also turned to Apple’s patent-pending pre-buffering technology that is supposed to make its streaming experience better than other current services, though as Evolver.fm points out, Pandora and Spotify have been using similar technology for some time already… And in related news, which is receiving less excitment than the Apple-EMI deal, is that EMI Music has now also reached an agreement with digital music subscription service eMusic.
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Bits & Pieces: Bronfman Testimony in Lime Wire Case Tied to Settlement?, Slacker Launches On-Demand, Relentless Goes After Coca-Cola & more…
Slacker launches its new on-demand music service
Last week saw a settlement agreement between the RIAA and Lime Wire founder Mark Gorton, in the amount of $105 million. The deal was reached after the first day of testimony from Warner Music CEO Edgar Bronfman Jr. – who was scheduled to appear back on the stand last Thursday, the day on which the settlement was reached. While the amount to be paid is much lower than what the major label plaintiffs were seeking, originally trillions and later it was pegged in the billions, many are looking to Bronfman’s statements during cross-examination as critical in a variety of ways. Was it the focus on how much money the CEO had gotten out of the investment in taking over the company in 2004? Or the massive layoffs and cutting of artists from the roster, or maybe the possibility of the Gorton’s attorney’s bringing up the recent insider trading conviction Bronfman received – a line of questioning that wasn’t ruled out by the judge. While over $100 million is still quite a lot of money (though it’s not likely to make its way to any artist pockets), and the shuttering of Lime Wire, can both be seen as victories for further diminishing illegal file-sharing of music, CNET’s Greg Sandoval points out, there is also a silver lining for the advancement of new digital music services, evidenced in the first on-record comments from a high-ranking label executive supporting the unbundling of music… Meanwhile, Slacker has launched a new on-demand music subscription service, adding to its current interactive streaming model that is similar to Pandora. This makes Slacker the first and only company to offer both fully developed interactive radio and an on-demand music services, according to company executives. While debatable, the move is certainly a coup for the service, which has often been often left out of the mainstream media conversations about the new digital music landscape… UK independent label Cooking Vinyl is getting a multi-million dollar infusion from a fund backed by VC firm Icebreaker, which will allow the label to make a number of high profile signings… Elsewhere, the intriguing litigation between FBT Productions and Universal Music Group, over the digital sales of Eminem songs, will continue in California to determine damages owed. Though, however much is determined, apparently for now, Em won’t be seeing any of it… And UK label Relentless Records, responsible for releases from Joss Stone, KT Tunstall and Cage the Elephant among others, has taken legal action against Coca-Cola over the increasing use of their energy drink product of the same name, Relentless, in connection with music venues and festivals, which is causing confusion and an unwanted corporate association for the label and its artists…
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Roundup: Grammy Bumps, Pandora’s IPO, Apple Makes Streaming Moves & More
Mumford sells 31K on Grammy day
While Glassnote Entertainment’s Mumford & Sons didn’t walk away with a Grammy award Sunday night, they did see a huge bump in one-day sales for their debut album Sigh No More. It currently is sitting atop the iTunes album chart at #1. Other winners and performers from the night, which saw the largest ratings for the award show in over a decade, are also getting a sales spike in the wake of the event… As anticipated, Pandora filed for an IPO last Friday seeking to raise $100 million, making it the first Internet-music company to go public since Napster went bankrupt in 2002. In filing, it was revealed, among other things, that the company spends half of its revenues on acquiring content, a fact that AllThingsDigital’s Peter Kafka points out, isn’t a bad thing… Reports over the weekend have Apple considering the possibility of turning its paid MobileMe storage service, into a free “locker” for personal memorabilia such as photos, music and videos – reigniting talk of the company’s move into offering a streaming-music function. Meanwhile today, Apple announced the launch of a content subscription system for music, videos, newspapers, magazines and other forms of content, which will work similarly to app purchases, except that customers choose their type of subscription. As for what it might mean specifically for music, Evolver.fm points out; on-demand subscriptions like MOG, Rhapsody, Napster and Spotify, and the paid version of interactive radio services such as Last.fm, Pandora and Slacker, can now charge you for a subscription right within iTunes, with the same convenience for you — and the same loss of revenue for them... Radiohead has announced details about their new album The King of Limbs, which will see a digital release this weekend, a month ahead of a physical release via XL Recordings. The band’s co-manager explains to Music Week the reason behind not releasing the new album in the same manner as In Rainbows… Former EMI Music A&R prexy Nick Gatfield has been named President Of Music Division for Sony Music UK, reporting to Chairman and CEO Ged Doherty… And does Guy Hands really want to double down and make a bid for both Warner Music and EMI?
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Exit Through the Gift Shop: A&R Moves at Jive & Interscope…
the Beats goes on
Executive shuffling continues as the year-end countdown proceeds, with the Hollywood Reporter revealing that longtime A&R executive Jeff Fenster is departing his SVP post at Jive Records, where he was most recently tasked with overseeing the Idol signings. He is presumed to be heading to a new senior-level creative position within Warner Music… Also, a recent bit of activity within Universal Music Group that was overlooked in all the scuttlebutt, is A&R hitter Luke Wood’s exit from his EVP post at Interscope Records to assume a new position within Jimmy Iovine’s Beats sector. Stocking stuffers anyone? Most expect more quiet moves within UMG to continue ahead of Lucian Grainge’s official crowning as CEO in January… Stay tuned.
12.2.10Music Roundtable: Executive Positioning
wheelin' & dealin'
The recent shake ups at the major music groups has led to a fair amount of musical chairs at labels over the last few months, including major shifts in creative leadership at Warner Music and EMI with more changes expected to be announced soon at Sony and Universal Music as well… Onlookers may notice a commonality between executives who have recently landed in creative positions, with insiders sharing that a man behind the man, behind the man once again has a direct line to label heads. Is a powerful veteran kingmaker back to pulling strings behind the scenes? Inquiring minds want to know…
11.17.10Wednesday Bits & Pieces: eMusic Loses Big Indies, Warner Re-Ups with Spotify & UMG Looking to Get Lean
Indies On the Way Out
Last month digital music retailer eMusic announced that they would be adding a quarter-million more songs to its service in a new partnership with Universal Music Group, this following previous deals with Warner Music and Sony over the last year, a move which had some questioning whether the service was getting away from its ‘independent’ roots. While too early to tell the larger effects the new major label partnerships will have on customers, some big indie labels have decided they will no longer make their music available, including Domino Records, Merge and the Beggars Group of labels, which includes 4AD and Matador among others. No small exit, as those handful of labels are home to some of the most popular current and past independent acts including Animal Collective, Arcade Fire, Spoon, Bon Iver and many many others. A statement from Beggars Group made it clear that the split, at least for them, is directly in response to the arrival of the major labels to the service and new terms that they “have found impossible to accept, in our own interests, those of our artists, and ultimately those of their fans”… In the latest Warner Music earnings call, it was revealed that the company has renewed their existing deal with Spotify, which currently covers European markets. And while no update on a agreement covering the U.S., many still suspect that deals with multiple majors for the startup to launch its service in America are in motion. In reference to the continued gap between physical and digital music sales, CEO Edgar Bronfman Jr. made it clear that he (and presumably all the labels) are hopeful for digital increases with the launch of Google’s impending music service among others, like Spotify?… More talk of looming cutbacks at UMG persist after the CFO of parent company Vivendi made recent ominous comments about cost saving needs, including “A lot of fat can be taken out without hurting muscle and bones” – onlookers continue to keep an eye on Island Def Jam as one of Lucian Grainge’s prime targets for restructuring… Elsewhere, Amazon.com is getting into the movie business by launching Amazon Studios… Check Your Pulse songwriter Bonnie McKee talks to Billboard about launching her own recording project after a string of credits on some of 2010’s biggest songs… And inquiring minds want to know, which former major label head has been spotted moonlighting on lead guitar in a Neil Young cover band?
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Wednesday Bits & Pieces: Tip of the UMG Change-Over, Yahoo Music Head Departs, MTV Funding Videos & More
Changes afoot @ UMG
The departure of longtime Universal Music Group vice chairman and CFO Nick Henny was announced this week, the first high-level executive to exit under new UMG ruler Lucian Grainge. Seen as only the tip of what will be a massive restructuring at the largest of the four major music groups, chatter continues about the fate of executives and the labels themselves including Island Def Jam, Mercury and both Motown and Republic labels. Stay tuned… After a relationship lasting almost four decades, Queen has officially parted ways with EMI, signing with UMG in a deal that will see the release of remastered albums next year… In more exits, Yahoo Music chief Jeff Bronikowski is reportedly leaving to join AOL Music - AOL has also been named among those recently interested in acquiring Yahoo, other names on the list include BMG Rights Management backer KKR… Though no longer “Music Television” in name, MTV has announced the launch of a new series of videos called Supervideos, that will see the company funding the videos themselves – a move spawned by the return of music video popularity online, and possibly the rise of a new rival in Vevo. The first video project is for the LCD Soundsystem song “Pow Pow”… Elsewhere, Warner Music is launching an archival project dubbed Sight of Sound, which will focus on the integral role that visuals played in the pre-Internet age, and to document the rich history of the label… And after two years of running as an ad-funded streaming service, the UK company We7 is refocusing as an online radio service similar to Last.fm and Pandora.
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In Case You Missed It: Reading Recap
The Best Things in Life Aren't Free?
Not to be left out of the growing media preoccupation with new music services from industry giants like Google and Apple, not to mention the handful of new players who have emerged ahead of the curve like mspot, MOG, Spotify and Rdio, MySpace Music is back in the mix with renewed reports this week of a looming subscription service. The company is said to be in talks with labels about moving away from their current free streaming model to a paid service… Simultaneously MySpace parent News Corp. was quick to deny rumors that the company is in talks to sell the once supreme social network that has been facing a tough transition and revolving door of executives over the last year… An article in the WSJ today examines the increasingly tough road for the live music business – and for those keeping score, Rihanna’s “Last Girl on Earth” tour appears to be the latest summer outing to announce cancellations… Elsewhere, Wilco is planning to start their own label and will be leaving Warner Music after a 15-year relationship, having released albums on both Reprise and then Nonesuch… And CAA + “The Decision” x Kanye West = LeBron to The Heat…
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