WE HAVE MOVED...

Here is the new website link:


http://musicindustryreport.org/

Personal Branding

If you are a CEO or an entrepreneur you are no doubt already familiar with the fact that personal branding is the new old-fashioned way to bring your business success. It’s printed everywhere! All you have to do is go out, promote your personal brand and watch your profit margins soar!

If only it were actually that easy.

The problem with personal branding is that while the technique is invariably successful, it doesn’t work very well if you aren’t familiar with the concept of personal branding and how it applies to business-both topics that articles on the subject tend to be suspiciously grey on! How a person can read a three page article on personal branding and still not have a clue what it is is a complete anomaly, but it happens. One can only assume that the people out there writing about personal branding don’t understand it any better than you do.

What is personal branding? Before you can begin to make any kind of marketing strategy work for you you have to understand its ins and outs, the way it works, how to make the most of it and what it has the potential to do for your life and your business.

You know that as a company and a business entity the most important thing you should be worrying about is your reputation. Your reputation is going to decide whether or not people come to you to meet their needs and, ultimately, whether your business will


succeed or fail. As the leader of the company, your reputation is tied up in your business. That means that while you’re in the hot spot you need to keep your reputation blemish free and do everything you can to cultivate your reputation as an expert in your field.

Welcome to personal branding.

Personal branding means marketing your image. When your image is strong enough, successful enough and popular enough, people will come to your company just to work with you. They trust your company because they know as an expert in your field you wouldn’t settle for any less than the best in your products and services.

Celebrities practice personal branding all the time. Why do you think the Olsen twins’ clothing line was so spectacularly popular when it first hit the market? Not because the clothes were remarkable (the designs didn’t really fit their niche until several years later) but because it was promoted by Mary Kate and Ashley Olsen.

There isn’t a red blooded American that was alive during the eighties that doesn’t recognize those two names.

You want that to be you. You want people to flock to your company just because you’re there. You can actually use your own reputation to boost your company’s profit margin.

Personal branding is easy. All it requires is confidence in your skills and an understanding of how those skills relate to your chosen market. Now all you have to do is go out there and show the world what you're really made of.

Artist Quote of the Week

"I've outdone anyone you can name -- Mozart, Beethoven, Bach, Strauss. Irving Berlin, he wrote 1,001 tunes. I wrote 5,500."

-James Brown

Yamaha now shipping their new AUDIOGRAM 6 and AUDIOGRAM 3 Computer Recording Systems

Yamaha Corporation of America is now shipping their new AUDIOGRAM 6 and AUDIOGRAM 3 Computer Recording Systems. Recently named Best in Show at the annual NAMM music trade show, these powerful yet affordable audio interfaces are designed to turn a computer into an intuitive tool for recording from virtually any microphone, instrument or audio device. In addition, the company is offering a $20 rebate on the AUDIOGRAM when purchased with a qualifying Yamaha keyboard, guitar, or bass.

Packaged as complete computer music solutions, the AUDIOGRAM Series bundle together a hardware interface with software for recording and producing music. Recording music from instruments, microphones, CD players or MP3 players is as easy as installing the included 48 track Audio/MID music-production application, CUBASE AI, on your computer and connecting the audio interface using the USB cable provided.

The AUDIOGRAM 6 features 2 XLR combo inputs with preamps, two stereo inputs, one-knob compression for dialing in the desired sound from microphones and instruments, and a USB jack for connecting to a computer. The compact AUDIOGRAM 3 features one phantom powered combo input switchable for microphones or instrument recording, a stereo input, a stereo and headphone output and a USB jack.

Purchasing an Audiogram 3 or 6 also qualifies you to register at www.MPSN.com to receive the X Factor DVD with over 4 GB of VST instruments from Sonic Reality, IK Multimedia, FXpansion and Arturia.

The AUDIOGRAM Series are now available for $149.99 retail (AUDIOGRAM 3) and $199.99 retail (AUDIOGRAM 6). Complete rebate terms and redemption form available at www.yamaha.com/rebates. For more information, write Yamaha Corporation of America, Pro Audio & Combo Division, Music Production, P.O. Box 6600, Buena Park, CA 90622; telephone (714) 522-9011; e-mail infostation@yamaha.com; or visit www.yamaha.com.

From Crackle: Open Labs interview with "Teddy Riley"--super prod...

Music industry turning against LOUD recordings?

Turn Me Up!™ is a non-profit music industry organization campaigning to give artists back the choice to release more dynamic records. To be clear, it's not our goal to discourage loud records; they are, of course, a valid choice for many artists. We simply want to make the choice for a more dynamic record an option for artists.

Today, artists generally feel they have to master their records to be as loud as everybody else's. This certainly works for many artists. However, there are many other artists who feel their music would be better served by a more dynamic record, but who don't feel like that option is available to them.

This all comes down to the moment a consumer hears a record, and the fear that if the record is more dynamic, the consumer won't know to just turn up the volume. This is an understandable concern, and one Turn Me Up! is working to resolve.



Check it out here:
http://www.turnmeup.org/index.shtml

TuneCore, iLike Bundle Indie Services

TuneCore and iLike have teamed up to offer independent and unsigned artists a package deal on both distributing and promoting their music. The partnership is more of a bundled product than it is a new service, as both companies offer their core services independently. But together, the two hope to present a more complete message than they could marketing their services separately.

TuneCore brings to the table a wide digital distribution platform, which can post clients' music to all the major digital retailers and subscriptions services. Once the music is available, iLike then lets users promote it through full-song streaming applications on social networks like Facebook, Bebo and other channels. Each time their music is played, artists get a royalty from the corresponding service hosting the file.

The partnership between the two firms lets artists sign up for both services at the same time, rather than requiring separate agreements.

Artist Quote of the Week

"Most of us go to our graves with our music still inside of us."

-unknown

Five Lessons Publishing Should Learn from Music

1. An iPod for Books Will Change Everything....

2. Think Beyond DRM....

3. If You Help Us, We Will Buy

The music business and Hollywood made a big mistake by fighting online distribution....

So, to publishers: Make your stuff available online. Make it easy to find. Make it easy to buy. And don't insult us: if a physical book -- with the cost of production, distribution and retail overhead -- is worth $20, a digital book is not. Cut the price accordingly. Take your margin, but don't abuse your customers with outrageous prices for e-books (otherwise, we will find other ways to get our books).

4. Don't Be Afraid of Free

Do you remember how in the olden days, the publishing business lead a massive effort to shut down public libraries, because free was the enemy of the publishing business? How they fought to stop people giving a gift of their favorite books to a friend? Me neither. Libraries help readers, they help publishers, they help books in general....

5. Find Out What Your Customers Want

Then build your business around that....Don't try to shoehorn us into an old business model that doesn't make sense with new technology. Your job is not to force customers to behave the way you want them to. Your job is to find out what your customers want, and then deliver it to them. Times are changing. Find out what we want, what we need, and then help us get it....

In Digital Music Market iTunes Still No.1

According to Ipsos’ fifth annual TEMPO Digital Music Brandscape study iTunes is the No. 1 fee-based digital music venue. Apple’s music distribution service managed to hold on to its position despite Amazon’s success this year, and RealNetworks’ Rhapsody’s gains, Retailer Daily reports. The object of the study was tracking fee-based online music brands and consumer digital music behaviors. The survey revealed to Ipsos that awareness and use were steady among the most dominant brands this year.

While iTunes grew in terms of awareness, usage, familiarity, and “best brand” mentions, Amazon’s first year also proved strong. According to the study, initial awareness, usage, favorability and “best brand” ratings were comparable to any of the top brands following iTunes. In fact, the online music retailer managed to match iTunes’ user satisfaction level. Rhapsody gained in both aided and unaided awareness, usage and favorability, but not as much as iTunes and Amazon did, of course. For the rest of the brands, total awareness, familiarity, and favorability decreased – not by much, though!

The reason iTunes’ brand strength has not weakened in light of increasing competitive pressure is that, during this same time frame, consumers became more demanding of the digital music services they use. iTunes dominates this market, but that by no means suggests that there isn’t room for innovative competitors with differentiated offerings.

The business side and creativity of music

As you all know having someone in your corner early in your music career to steer you in the right direction is vital, and along with that being confident enough to trust someone to handle your business affairs. But keep in mind what I said earlier, watch your manager like a hawk no matter who they are.


But on the plus side, a manager who has music business and creative vision will see beyond making money from just managing your affairs but know the right A&R people for your style of music. Along with that, session players who are suitable for stage and studio work if your band has to take on hired guns. Along with being able to see what markets are suitable for your genre of music which may not be in North America, But Europe or Asia.


An agent should be separate from a Personal Manager to better enable an agent to concentrate on bookings in clubs, festivals, and bigger venues along with setting up concert dates where a band can start opening for others. Having an agent take care of the money gigs and a manager setting up your music business and taking care of personal affairs, enables you and your band to concentrate on the creative end of musicianship. But musicians should at least have a working knowledge of the business side of music. That way if you and your manager part ways, you and the other band members can take over the business end temporarily.


Learning about music and thinking differently:


Even if you've been in the business for years you can still learn from guitarists who've only been at it for a few months believe it or not. They may play something at a jam session that totally floors you and end up using that little riff or chord structure as an element of your style, by changing it slightly so you're not just stealing it. As well, and I keep saying this, learn as much as you can about the music industry from others and reading magazines such as Canadian Guitar Player Magazine, Canadian Musician and Guitar Player to learn the latest innovations and to constantly educate yourself. Associate yourself with musicians who are serious about their craft and you won't constantly find yourself spinning your wheels in bands that go no where.



I may be getting a bit off topic, but what I'm talking about in this article is imperative to do. I know a lot of music industry people would disagree with me on when to hire a manager and how to run one's music business, but then again you have to think differently guys.

Artist Quote of the Week

"Music is your own experience, your own thoughts, your wisdom. If you don't live it, it won't come out of your horn. They teach you there's a boundary line to music. But, man, there's no boundary line to art."


- Charlie "YardBird" Parker

EMI jostles into busy online market

EMI is planning to enter the crowded digital music market, forming its own site to join the likes of iTunes and MySpace and marketing its artists’ music directly to fans online.

EMI.com, a consumer-facing portal to be launched before Christmas, has been closely monitored by Guy Hands, head of the Terra Firma private equity group that bought the record label for £2.4bn ($4.2bn) last year.

The digital project, which began this year, will offer audio and video content. Users will be able to buy music and download it. There will also be unique content and elements of the site will be free. EMI declined to comment further about its plans.

The record label wants to position EMI.com as a “learning lab” where people can discover new music as part of a broader digital strategy.

Mr Hands has accused the music industry of being flabby, bureaucratic and refusing to face the challenges of the internet. He has spoken often about the prospects of the internet for marketing and online communities.

However, similar digital initiatives by the music industry, such as Sony’s PressPlay, failed because they did not offer consumers access to the catalogues of rival labels.

One music industry executive said: “Research has shown that when consumers are looking for music they want it all in one place. They want to buy Beyoncé when they are buying Rihanna. I am not quite sure what EMI will get for the money they have spent on it.”

Last year EMI – whose artists include Kylie Minogue and Coldplay – had a 13 per cent share of the global music business; Universal Music had 28 per cent; Sony BMG about 17 per cent; and Warner Music 15 per cent, according to Music & Copyright.

Most of the important music labels have some consumer-facing offering. Universal Music, whose acts include Amy Winehouse, also intends to launch a video portal service that will offer professionally produced music videos and original programming early next year. That product is intended more for professional website owners and for developers than for consumers.

There are also high hopes for music downloads on mobile phones, including services such as Nokia’s “Comes with Music”, which has signed up all the big labels.

MySpace Caters To Majors, Not Indies

"KOCH Records, as the #1 Independent label in the U.S. for the last 7years, was disappointed to see MySpace's 'smoke and mirrors' announcementregarding its new music service. Essentially it has announced a deal withthe majors and has in effect become MajorSpace.

"It is unconscionable that it would give equity positions to the majors andtreat the independent community as second class citizens after having builtits service on our backs, as its CEO has acknowledged. It makes no sense atall the that the Majors will benefit from the utilization of ourcontent without our participation as well. To be clear, our issue is notwith the Majors having equity but with MySpace believing that we wouldaccept this without similar terms. MySpace continually states that it isembracing the independents. It's a pretty listless and cold embrace."

About KOCH Entertainment

KOCH Entertainment, founded in 1987 and now in its twenty-second year, isthe leading and fastest-growing independent music company in the U.S.KOCH's operations encompass record and video labels, music publishing aswell as distribution companies in the U.S. and Canada. KOCH Entertainmentis the market leader among independent labels and distributors in both theU.S. and Canada. Its record label KOCH Records is the # 1 independentlabel in the U.S. and had the largest number of Billboard charting albumsamong independents for seven years in a row (2001 - 2007). KOCHEntertainment is a subsidiary of Entertainment One Ltd. which is listed onthe London Stock Exchange's AIM market (ticker symbol "ETO"

Music Business Service for Project Financing and Investments

Bandstocks is another music business service introducing an alternative to the ad supported free music business. Bandstocks is about financing music projects.

As the music industry is on the move the term project might become an interesting subject. Creativity today is not only required by the artists themselves to create something that is desired, but too by creators of concepts and marketers in the entertainment business to establish a successful business. As one may state that the time of the million billion dollar business is over for the music industry today new concepts might be needed to establish a business model based on art. Art might be the right term beside music as there indeed exists a broad playing field consisting of music, video opportunities and further ways of expression. Maybe a more comprehensive and integrated approach might be the new success model in the entertainment business. This is a chance to a broader range of market participants, the established entertainment business, independents and new artists as well as for other players like programers and even event organizers.

Artist Quote of the Week

"I don't know anything about music, In my line you don't have to." -Elvis Presley

SoundCloud Streamlines Music Sharing For Industry Professionals

Transferring large files on the web has always been a hassle, especially when you need to do it frequently. One field especially prone to this problem is the music industry - artists often collaborate with eachother by sending rough versions of tracks, but have to rely on clunky services like YouSendIt or FTP servers. SoundCloud, a German startup that launches on October 10, is looking to streamline this process by allowing an artist to upload a file once and easily distribute it to whomever they’d like. The site is currently in private beta, but you can grab one of 500 invites here.

SoundCloud isn’t meant as a consumer site - rather, it’s a service for industry professionals, including artists, music labels, and producers. From the outset, it’s clear that SoundCloud is very well designed, with an intuitive interface that falls firmly under “Web 2.0″. The site revolves around artist profiles and the tracks they’ve uploaded, which are presented in an embeddable basic music widget (you can see one below). Aside from standard playback, the widget also allows artists to open up their tracks to comments from outside visitors, which can be appended to specified times.

Artists can specify how much control their users will have over their content, setting their music to stream-only, or as available for download. The site also supports listener analytics, so artists can see how many visitors have listened to their tracks. And the site supports a wide variety of audio formats, with no restrictions on file size.

SoundCloud also includes some basic social features, with artist profiles detailing professional contact information, much like a musician’s social network, and a follow system that allows you to receive alerts whenever a friend or colleague uploads a track. There’s also a Dropbox that allows visitors to submit songs to you for review - it’s a digital version of the mailed-in demo tape.

Provided SoundCloud can get a foothold in the music industry (which isn’t an easy thing to do), it seems poised for success. There are many other options for media sharing, but SoundCloud has executed extremely well, with an interface that should make sense to even the most technically-challenged users. Major producers and music labels may be hesitant to embrace it in the near future, but there’s a massive market for indie artists and fledgling musicians that will pounce on the service immediately.

Music Business 101: Chapter 6 - Watch a funny movie here

Webcasters Welcome House Vote On Royalties Negotiation

Internet radio stations can extend their negotiations with labels and artists over performance royalties following a key vote in the House Of Representatives.

The legislation, H.R. 7084, was passed on Saturday night (Sept. 27) and now moves to the Senate.

The legislation authorizes collecting society SoundExchange to negotiate new royalty agreements on behalf of copyright owners and performers for internet radio through Feb. 15, 2009.

The Digital Media Association (DiMA), SoundExchange, National Public Radio (NPR) and the Recording Industry Association of America (RIAA) welcomed the vote.

"Everyone is grateful to the sponsors of the bill and to Chairman Berman for getting this through the House last night," said SoundExchange executive director John Simson in a statement. "This bill favors all webcasters and simulcasters - large and small. It paves the way for SoundExchange to use the coming months to pursue helpful solutions that allow all services to focus on business development. And, although there are no agreements yet, I am hopeful."

The modification to existing legislation was introduced because Congress will be out of session as discussions between both sides continue. Negotiations are set to resume when the bill is enacted.

"This legislation benefits all music webcasters and excludes none," added Michael Riksen, NPR VP of policy and representation in a statement. "Passage will facilitate closure of an agreement to enable all public radio stations to continue their public service through the webcasting of music."

The bill does not affect any underlying copyright law.

Personalized Internet radio service Pandora had said it could shut down as a result of the new licensing fees due SoundExchange, under the recent Copyright Royalty Board licensing system.

MySpace new Music service for UK music industry

News Corporation has just started its new MySpace Music service in the United States this week. Almost all the major record labels and a retail partner (in the form of Amazon’s DRM-free MP3 store) co-operated with News Corporation for this launch. However, it is somewhat essential to know what good it will bring for the consumer and the music industry.

Nicola Slade, who is editor of UK music industry news service Record of the Day, said: “No doubt, it’s a great move for consumers as it will help them listen to far more songs than they could listen before.”

Slade added, “The association with Amazon’s MP3 download store would serve as a key that will be there as a serious competitor for Apple and iTunes.”

“It is, indeed, the very first download store that has the ability to reduce Apple’s MySpace share.”

“The service will make consumer realize that there is another world outside of iTunes and the services like 7digital and other smaller services can pick up more business from them as well.”

Joe Wilson, who is lecturer in Popular Music at the University of Gloucestershire, said: “This move from MySpace to offer music through its network is to promote it as a radio service for free music, but you have to pay to transfer to MP3 players,”

Artist of the Week

"It's much too late to do anything about rock & roll now ..."

Jerry Garcia

MySpace Music Launches with Notable Upgrades

MySpace will flip the switch on its long-anticipated MySpace Music service on Thursday, completely revamping every element of the music section of the social network and bringing several elements of the music industry to the table with the launch.

In order to win favorable licensing terms from the major labels, MySpace created a joint venture to oversee the music initiative, which is partially owned by the four major record labels. While Universal Music Group, Sony BMG, and Warner Music Group were known participants for some time now, EMI Music Group joined the joint venture as a stakeholder at the eleventh hour, on the eve of the service's launch.

And while a slight bit of controversy bubbled around the lack of independent labels or digital aggregators involved in the joint venture, MySpace also unveiled licensing deals with not only the Orchard, but also such independent distribution groups as ADA, Red, Fontana and Caroline.

The new music service, while operated as a separate joint venture from the greater MySpace service, is tightly woven into the fabric of the social networking site. Artists with profiles (as well as licensing deals) on the service may now stream their entire catalog in full from their pages, whereas previously MySpace limited it to six tracks.

Other features at launch include:

-Fans can post up to 10 songs on their profile for others to stream when visiting, and up to 100 songs for their own personal enjoyment via a playlist building function.

-When any MySpace member (artist or fan) adds music to their playlist, their entire friend list is notified via the “Friend Updates” feature, which will contain a link to the song added.

-Wherever a song link appears on the service, there is also an “add” button that allows any member to add that song to their playlists, as well as a “buy” button to purchase and download the song via retail partner Amazon.com. Additionally, members can search for ringtones available via MySpace sister company Jamster (parent company Fox Interactive Media owns both companies).

The MySpace Music homepage has also been revamped, including a more robust “featured artists” section and the addition of a celebrity playlist section.

Noticeably missing at launch are several features promised when MySpace first unveiled its music plans this spring. They include:

-The ability to buy concert tickets and artist merchandise. Ultimately, MySpace hopes to add these sales opportunities to every artist profile in a future update.

- Content: Due to the lateness of the EMI deal, as well as the ongoing negotiations with independent labels and their representatives, music from artists other than UMG, Sony BMG and WMG is not yet available. However, new music will be ingested on a regular basis.

-Music recommendations: While friends linked through MySpace will learn of each other’s music additions and recommendations, there is no function to recommend new music to users based on either listening history via some kind of algorithm or by matching members who don’t know each other but who have displayed similar music tastes.

-A syndication strategy. All the playlists created on member profiles are limited to those profiles only. Users can’t post their playlists to other blogs, websites or in any other way take advantage of widget-based distribution.

However, MySpace representatives stress that it will upgrade the music service with these and other features over the course of the next year.
Aside from the features, the model behind the MySpace Music service is generating the most attention. It is by far the most ambitious attempt to profit from free full-song streaming based on advertising.

Officials at both MySpace as well as the various record labels believe the majority of activity and revenue will come from the free ad-supported full-song streaming throughout the network. As part of the streaming feature, MySpace created a music player that pops up in a separate window, both so users can enjoy music while navigating to other areas of the site and also to display banner ads that monetize the service.

All labels and artists licensing music to the site will receive a share of the service’s ad revenue based on the number of times their music is played. The major labels involved in the joint venture will also share a portion of all underlying revenues.

Neither MySpace nor the labels involved will discuss the exact terms of the venture deal, but insiders have speculated that the labels collectively own 40% of the venture, and in return dropped the standard penny-per-play licensing fee for music streamed online.

Also notable is MySpace’s decision to outsource all a la carte sales to Amazon.com. Ringtone sales are outsourced to Jamster, and expect future ticket and merch sales to be outsourced as well.

Digi-Indie Labels

The Major Labels have been known to be unfair to artists. Many Major Label artist are now speaking up about, Major Label shady accounting practices, non-disclosure clauses and delayed payments.

On the postitive side, Major Labels have a great promotion and distrbution structure. This means that if your project is released, the the chances of it being properly promoted and makes money increases greatly.

Although, many talented artists signed to a Major Label, have had projects put on hold, or, “shelved”. It’s been reported that Alicia Keys was shelved by her first record company because the A&R staff couldn’t hear a market for her material(WTF!??).

Major Labels are not the way to go (IMO).

Many Indie Labels fail within the first three years (like your average business). Although Indie Labels are dedicated to the creative proccess,they often lack the capital or connections to compete with and beat the majors at selling records.

There is a third way - a better way that allows you to control your own works. I call it a Digi-Indie Label. A Digi-Indie Label is an Independent Label that is digital based.

A Digi-Indie Label has it’s headquarters in your inside of your computer. With a Digi-Indie Label, you can record your material, manage the administrative, promotion, marketing, distribution and sales of your material all from your computer.

Merchandising 3.0

Merchandise sales have emerged as an important component to a successful career in the music business. Selling CD’s, shirts, stickers, hats and posters is a great way for an artist to get free advertising from the people who buy and can be a real moneymaker when done correctly.

It does take up front money to get the merchandise designed and printed. The first step to getting a merchandise effort established is to get a screen print set up for the design or designs that will be used. Once the screen print is set up it is time to get price quotes from multiple screen printers. The variables that determine the cost of getting merchandise made include the type of merchandise ordered, quality (100% cotton vs. 50/50 t-shirts for example), quantity and number of colors used in the printing.

A 50% profit margin is a good benchmark for setting a retail price (if it costs $10 sell it for $20). Bundling items together is a good way to increase sales, for example if CD’s and shirts are both $12 bundle both together for $20. Keeping tight records of the merchandise sales and inventory level can be the difference between making and losing money in this effort. Make sure to only give merchandise away for free to people who might help create a buzz by wearing it or are very influential in the music business.

The standard deal for the person manning the merchandise section of the club is 10% of all sales. If $200 worth of merchandise were sold $20 would go to the person selling the merch as a courtesy. Some venues will provide a merch person if the artist doesn’t have their own for the show.

Atist Quote of the Week

“When I hit that note - if I hit it correctly - I'm just as important as Jimi Hendrix, Eric Clapton, or anybody. Because when I hit that note, I hit the umbilical cord of anybody who is listening.”

-Carlos Santana

Digital Mobile

- Sony BMG's Commercial Music Group unveiled a licensing Web site for filmmakers called MovieTunes. The site allows filmmakers to submit the music criteria they need, which a Sony BMG staffer will then use to help find the right song.

- Warner Music UK agreed to license its music to an MP3 store operated by British supermarket chain Tesco. The deal includes custom album bundles, remixes and interactive booklets.

- IODA has agreed to offer RightsFlow's accounting and business management music licensing system for mechanical and DPD licensing to its label clients.

- RoyaltyShare is expanding its digital media management tools to mobile, through a series of deals with mobile content providers. They include LiveWire Mobile, Moderati, SendMe Mobile, Thumbplay, and Zed.

7digital Signs Sony BMG To MP3

U.K. download service 7digital.com has signed a deal with Sony BMG to sell around 250,000 tracks from its catalog in high quality MP3 format.

7digital says it is now the largest DRM-free store in the U.K., with a total of four million tracks. It has now signed up all the majors to the MP3 format following an agreement with Universal Music this month.

The London-based digital music service launched the Sony BMG catalog (Sept. 16) on its site today, in addition to launching new stores with localized content in Italy (it.7digital.com), Austria (at.7digital.com) and Portugal (pt.7digital.com). A pan-European store also launches today featuring catalog that has been cleared for the whole of Europe; 7digital has existing services in the U.K., Ireland, Germany, France and Spain.

CEO Ben Drury also announced plans to launch in North America in the fourth quarter of 2008. No date is confirmed, although Drury told Billboard.biz they will open an office in San Francisco.

"We already operate in the U.S. in a small capacity on the business-to-business side," said Drury at a London press conference today. "As the market moves to MP3, the U.S. has become more interesting to us and we have been getting more [web] traffic in the U.S."

Drury says the American launch will focus on building through partners such as social networks and other companies. As well as selling tracks direct to consumers, 7digital also delivers audio and video on behalf of record labels, artists, film and TV companies, as well as retail and brand partners.

The download store has been a major advocate of MP3 and Drury says he believes the U.K. launch of an MP3 service by Amazon "will promote choice" for download formats and he predicts a "backlash" against digital rights management.

Around 200,000 customers who previously purchased Sony BMG music in the WMA format from 7digital.com will be able to upgrade the tracks to MP3. "I think that's a very consumer friendly thing for Sony BMG to do," said Drury.

He contrasted the 7digital approach to MP3 with the protected music files sold on Apple's iTunes store and other mobile and subscription services. "People are a lot more likely to purchase albums in MP3," said Drury, adding that the format has helped boost the average transaction on 7digital.com to £4.50 ($8.03).

"Consumers see DRM as somewhat of a hindrance when purchasing legal digital music," said Drury in a statement. "The availability of all of the big four music labels in high-quality MP3 is fantastic news for the UK music fan - everything they now buy from us they can be sure will work on all their devices. We've seen a huge increase in sales since making MP3 downloads available on 7digital.com."

The company also outlined plans for a new partner program and application programming interface (API).

The API platform will allow third-party developers to create their own download and streaming services. The partner program is designed for non-developers who can use widgets that can play music on Web Sites and blogs and provide a link for fans to purchase tracks at 7digital.com. Partners will earn commission for tracks and albums they sell.

The announcement follows U.K. supermarket chain Tesco's partnership with Warner Music U.K. to sell MP3s via www.tescodigital.com.

Tesco's service has all the majors on board and currently has 3.3 million tracks in total. Around half of them are sold in MP3 format.

Music business is still game amid the gloom

What the popularity of games such as SingStar and Guitar Hero show is how games have matured, moving from teenagers’ bedrooms into the living room. Just as Doctor Who reinvented family viewing, the new generation of games reinvented family entertainment.

What the music games also reveal is a route to revival for the beleaguered music business.

The appeal of music has always been far more than listening to recordings or the radio; it involves going to gigs and festivals – and singing into the shower head. While only a minority can play or sing well enough to be taken seriously as performers, music games tap into the desire of the rest of the population to be rock stars. And because people cannot pirate the technology easily, the games and the songs can be priced to generate a sustainable income.


The interest is clear from the number of songs that people are prepared to download – 20 million in the case of Guitar Hero. The most frequently purchased download by SingStar customers is Bonnie Tyler’s Total Eclipse of the Heart. Both games are racing to announce tie-ups with familiar bands – SingStar will release a Queen-themed game next year, a few months after Guitar Hero’s Metallica special edition.

Computer games will not be enough, in isolation, to solve the structural problems facing the music industry but by tapping into people’s true relationship with music, it demonstrates that the day the music dies is a long, long way off.

Artist Quote of the Week

“Going out and playing music - that's what I do. I don't do much else.”

- Dave Grohl

Promoting Your Band 2.0

A website is always a safe bet for getting ur name out there. Simply buy a domain name (or use a free web space provider - however yourname.com looks more serious than geocities.com/yourname) and build the website yourself or pay somebody else to do it. It may cost but it really is worth the time and money if you make it good and advertise it right. Some good things to include on your website are MP3's, biography, gig dates (no matter how small and low key) and any other information you can think of. Then get it into as many search engines as you can. Its amazing how many people will look at your website simply by stumbling across it in Yahoo or Google. A website is always a worthy investment if you're serious.


If you already have a few fans, or even friends who like your music, its always a good idea to get them to do the promotion for you. Print flyers, stickers, make demo tapes, anything, and get people to hand them around or give them to their friends. Its a very effective way of spreading the word, through a Street Team. It is how Linkin Park started out and look at how successful they are today. If your friends and fans are willing, also get them to post on message boards or go in chat rooms of music websites. Promotion teams are very effective.


Go into chat rooms and message boards on the websites of other, already well known bands and tell the whole internet about you. Most message boards of well known bands have 10 000 + members, so just imagine how many people will see your name and check you out. It works, again, it is a method often used by signed and unsigned bands who need more recognition. It works for other bands and it will work for you, try it out.


Like anything, you won't get anywhere without a little hard work from yourselves. You won't get yourself recognised by sitting there waiting for it to happen. Spread the word about yourselves, pin up flyers wherever you can, advertise your gigs in newspapers, basically anything you can think of. If people like your music they will soon spread the word themselves and you will quickly get a loyal following which will keep growing as long as you are willing to put in the work yourselves.

You can't rely on other people to do everything for you and you can't expect things to just magically take off for you overnight. It may take a while but in the end its worth all the hard work.

Amazon Launches Music Wiki

Wikipedia is an undeniably helpful resource for researching bands, with fairly accurate data that tends to be updated in near real time. Amazon hopes the same sort of thing will happen on its new SoundUnwound site, which borrows a page from Wikipedia's playbook by allowing users to edit information about any band, label, album or song.

To get the ball rolling, Amazon has included music information from its retail site as well as data from the Internet Movie Database and Musicbrainz (an open-source Gracenote-style database that can associate metadata to CDs and digital files). Amazon staff and a Mechanical Turk group built upon this data before the site launched on Monday.

As with Wikipedia, users can edit this information, but not directly. All changes must be vetted by Amazon staff before appearing on the site, so you can forget about retroactively joining Run D.M.C. Rankings charts list the users with the most approved edits for the day, week or of all time, offering a bit of motivation to those want to amass that sort of authority.

SoundUnwound is well laid out and already offers a wealth of information. For example, the page for The Fall -- a notoriously difficult band to cover, given all of their releases and lineup changes, includes lots of ex-band members, an accurate date of formation, and information on no less than 153 releases, including 28 studio albums. There's plenty of room for fans to add trivia as the site expands.

Discographies can be sorted by studio album, single, live album, compilation and EP. And once you drill down to an album page, links appear to purchase the band's songs on Amazon MP3. Relevant YouTube videos are embedded throughout the site as well. But one of the most attractive elements are the Flash-based, scrollable and zoomable timelines that depicts bands' history graphically.

Picture_2 Using The Fall as an example again, to the right is the section of their timeline where guitarist Craig Scanlon, bassist Stephen Hanley and drummer Simon Wolsencraft left the band. By mashing up the band member information with its discography, SoundUnwound lets users draw conclusions about how a band's sound changed as a result of personnel shakeups.

Amazon has taken a bit of heat for not including a way for all of this data to be used on other sites. "I am skeptical about any wiki-style site that doesn't make the user-contributed data freely available," wrote Paul Lamere of Duke Listens. And he has a point; it'd be nice of Amazon to allow this data to flow elsewhere on the internet.

EMI Slashes Operations in SE Asia

EMI Music is shuttering its operations in a string of Southeast Asian markets, handing its distribution and marketing over to Warner Music Group (WMG).

The move, which was announced today and is effective immediately, followed several weeks of industry speculation that EMI might be scaling down its operations in Asia. Described in a statement from EMI as a "multi-year license agreement," it will see WMG market and distribute EMI's worldwide repertoire in Hong Kong, Malaysia, Singapore, South Korea, and Thailand.

In Indonesia alone, Warner will handle marketing and distribution while a dedicated EMI office will continue to deal with A&R tasks for domestic repertoire -- including new signings. EMI declined to comment on whether new local signings would be made in the other territories, but Billboard understands it is unlikely.

WMG will exclusively handle exclusive all physical and digital distribution of EMI Music releases.

Lachie Rutherford, Warner Music Asia Pacific's president, said in a statement: "EMI's artists will now be able to fully leverage our South-East Asian operations, specifically our marketing teams and vast distribution network of traditional retail, wireless and online partners, through which we've seen great success in recent years."

EMI says it still plans "to develop global digital partnerships" in the territories covered by this new deal. According to EMI's London-based president of Asia Pacific/Latin America Adrian Cheesley: "In Southeast Asia, EMI will retain a small regional team in Hong Kong to oversee the local marketing and distribution of our artists' music, working closely with Lachie and his team."

It is as yet unclear how many job losses are involved; however, it is understood that EMI is currently in consultation with all its employees in the affected markets. An EMI spokesperson would not disclose the staff numbers involved.

The two majors already have a partnership in place covering India, the Middle East and North Africa, where EMI has marketed and distributed WMG physical products since 2005. The new agreement is expected to have no impact on other Asia/Pacific markets -- India, Japan, Australia and New Zealand -- where EMI will continue its wholly owned operations.

Artist Quote of the Week

Art is a way to express yourself and through that you can escape a bad situation
-Russell Simmons

Majors Ink O2 Concert Distribution Deal

Digital content provider New Stream Media (NSM) has inked licensing deals with the four majors, allowing it to record and distribute concerts at London's O2 and indigo2 venues.

NSM -- the venues' digital content partner -- has signed deals with Universal Music, EMI, Warner Music Group and Sony BMG in the U.K. to transmit recordings of concerts via digital TV, mobile networks and the Internet. The deal with Sony BMG also includes distribution in continental Europe.

NSM's contract with AEG, operator of the O2 Arena and indigo2, already gave it first option to provide digital platforms for events at the two venues. It has previously recorded live shows by the likes of Elton John, Keane, Kaiser Chiefs and the Sugababes, making them available to download via O2 Active, a mobile service from the venues' mobile carrier sponsor O2.

In June, NSM teamed with U.K. content-production company Spin TV to produce "Live at indigo2," a series of events transmitted on commercial digital-TV network ITV2, and available for audio and video download through online retailer 7digital.com.

And the major-label licensing agreements will create further digital opportunities, according to NSM's managing director, Abigail Hemingway.

"It gives us a stronger platform from which to propose ideas to artists performing at the O2 [Arena] and indigo2, and to create better content from the events," she tells Billboard.biz. "It allows us to be more creative."

Hemingway says deals with several indies are also in place. Future plans include streaming events live.

Outsourcing

The name for this might not be so appealing, but it’s actually a very effective method of collaboration. It is especially useful when multiple musicians are involved. One person is the primary writer, arranger, or producer, who works with other musicians possessing particular skills (instruments, arranging, mixing, production) that contribute specific parts to the piece. An excellent example would be a producer of dance music laying down an instrumental track, then asking a vocalist to write and record a vocal part, or a country writer recording piano and vocals but working with a guitarist for acoustic and electric lines.

Outsourcing can be done either on or offline, and should not be confused with simple session playing (work for hire). In this case, though the primary writer can be doing the most work overall, they are not actually writing every part. Other musicians are still writing, performing and contributing, and their level of involvement can extend past their own parts. A vocalist can help craft the arrangement and instrumentation of a given section, for example, to make their vocal part fit in well.

This method of working is really the only viable one for larger collaborations, where it would be impractical to use either of the first methods of collaboration due to time, geography, or technical restraints. It enables multiple musicians to work on the same piece simultaneously without stepping on each other’s toes, provided the primary arranger maintains clear perspective of the “big picture” for the song.

Despite the name, outsourcing does not necessarily mean that the primary arranger is doing the most work overall, or that they have the most important role. They may simply be crafting a basic arrangement, while other musicians flesh out the instrumentation, add new writing, and then finally produce and mix the track.

courtesy of soundtempest.net

Co-Publishing Deals

1. Typical Scenario. This type of agreement is typically used for writers who are in groups already signed to a record deal. This type of agreement covers the original material on the group’s records. Normally all of the members of the group who are songwriters will be signed to this type of agreement with the same publisher.

Just to be clear here, I’m talking about a publishing deal with a publishing company not affiliated with the record company. Today, it is much less likely than it used to be that a record company will demand a publishing deal as part of a record deal.

2. Material Covered by the Deal. All of the original songs on the group’s first record, then the publisher will have the right to options on the original songs on anywhere from two to four of the follow-up albums, hence for a total of 3 to 5 albums, with the exact number depending on what the parties negotiate.

3. Copyright Transferred. The songwriter normally transfers one-half of the copyright ownership to the publisher and retains the other one-half ownership. In other words, the song is co-published (and the copyright is co-owned 50-50) by the third party publisher and the writer’s own publishing company.

4. Income Sharing. Normally, the third party publisher will collect all income and then pay to the songwriter and the songwriter’s publishing company 75% of all publishing income.

5. Term. As already mentioned, co-publishing agreements are usually for a certain specified number of albums.

6. Advances. Advances are almost always paid to the songwriter in the case of co-publishing deals. For groups newly signed to major label record deals, the initial advance from a major music publisher is typically in the $150,000 - $500,000 range and sometimes higher, with additional advances being paid if and when the publisher exercises its options for the follow-up albums.

Artist Quote of the Week

There is two kinds of music the good and bad. I play the good kind.

- Louis Armstrong

The Orchard Licenses Catalog To Limewire

The Orchard is licensing its music to the DRM-free a la carte music download service operated by file-sharing network LimeWire. The store, launched earlier this year, has existing content from Redeye Distribution, Nettwerk Music Group, and IRIS. The addition of 1.2 million tracks from The Orchard doubles its catalog to more than 2 million songs.

The LimeWire store operates much like any other digital retailer, selling tracks both a la carte and taking an eMusic-like approach and selling tiered bulk "subscriptions" that offer anywhere from 25 to 75 songs a month on a sliding pay scale.

The company remains embroiled in a copyright infringement lawsuit brought by major labels against its popular P2P music network.

Administration Deals (aka "Admin Deals")

Typical Scenario. This type of deal is used when the songwriter just wants a publisher to collect royalties and handle the various paperwork (for example, the BMI/ASCAP song title registrations, copyright applications, the issuance of licenses, etc.), and where the songwriter does not want or need a publisher to proactively promote his or her catalog of song. A good example of a company that does a lot of Administration Deals is Bug Music in Los Angeles.

Material Covered by the Deal. Most often this kind of deal covers all material written by the songwriter, or at least any material that the songwriter has not already committed to other publishers.

Copyright Transferred. No transfer of copyright.

Income Sharing. Typically, the publisher will take 10% to 20% of the income, and the pay the rest to the songwriter and the songwriter’s publishing company.

Term. Administration deals are normally in the range of three to five years.

Advances. For catalogs generating a modest amount of income, usually no advance is paid. For more profitable catalogs, usually an advance will be paid, with the amount to be determined on the basis of the income that has been generated in recent years by the catalog.

Mixtape Community 8tracks.com Unveils Service

With user-generated playlist site Muxtape shut down for an indefinite amount of time, newly launched 8tracks.com is hoping to fill the void left in the mixtape community. Like Muxtape, the site allows users to upload content from their personal music libraries and create playlists for others to stream. The site also allows users to create playlists using content uploaded to the site by others.

Unlike Muxtape, the site does not allow users to see what track will play next or to skip forward and backward through tracks they might not enjoy. This is because 8tracks operates under a compulsory license as a non-interactive webcaster, as mandated by the Digital Millennium Copyright Act.

8tracks was founded by David Porter, formerly the director of business development at Live365.

Artist Quote of the Week

"99-cent singles create excitement. Whoever came up with that was somebody who was a little bit older and remembered buying 45s. The thing about it is, once they buy the singles, what's next. And that's what the record companies are not doing."

-Jermaine Dupri

Live Nation Moves Into Latin America

Live Nation has made a major foray into South America in cutting a five-year exclusive distribution deal with CIE and T4F (Time For Fun), giving LN a huge presence in Brazil and Mexico. CIE is the third largest concert promoter in the world, according to Billboard Boxscore.

The deal effectively locks down Mexico and South America for Live Nation on most major tours in this vital and growing region, where LN has previously not been a dominant promoter.

"Wherever we can we want to have a Live Nation office executing, and we haven't had that in Latin America, largely because CIE is just so dominant," Jason Garner, Chief Executive Officer, North American Music, tells Billboard.biz. "In a region where we had zero market share, to form an exclusive deal like this gives us immediate entry, it didn't cost us a lot of money to get in, and we get the most proven execution and venue partner in the region."

Though this deal has been in the works for a year, Garner says Live Nation and CIE already had a relationship in place through LN's Global Touring division. "We wanted to formalize that relationship to make it exclusive and then add on the important South America piece to really complete our Latin America play," he says. "It was driven by a mutual desire between the two companies to find a way to formalize what has been a very friendly relationship. They were looking for a steady supply of talent and we were looking for an exclusive execution partner and that brought the two of us together."

Producing live concerts that drew over six million music fans in 2007, CIE generated more than $1 billion in revenue and margins approaching 21 percent, according to Live Nation. CIE, which is publicly traded on the Mexican stock exchange, also operates its own ticketing platform in many markets including Mexico City, Guadalajara, Monterrey, and others.

LN says CIE produces more than 85% of all the live concerts by international talent in Mexico, a country with a population of more than 100 million people. T4F operates top venues in Sao Paolo, Buenos Aires, Lima, Rio de Janeiro, Santiago, and Porto Alegre, all of which are emerging as important new markets for international talent.

Ocesa, CIE's live entertainment division in Mexico, is a vital component of the deal. "If you're a world class artist, you don't work in Mexico without working with Ocesa," Garner says. "By having an exclusive relationship with them it really gives us a nice advantage when we're sitting down talking with an artist, that we have this great partner South of the border."

George Gonzalez will continue as president of Ocesa in Mexico, Fernando Alterio will remain as president of T4F, and Bruce Moran will be president Latin America for Live Nation based in Los Angeles. "When you enter into a relationship like this, what you want to know is when you take a band that trusts Live Nation and you walk into Latin America, that you have solid operators," says Garner. "The key here is we have trustworthy, solid partners, a well financially backed, publicly traded company, and the best part is they're our friends.

Alejandro Soberón Kuri, Chairman and Chief Executive Officer of CIE says in a statement: "It is very clear to us that Live Nation's global platform is attracting the world's most exciting and successful artists, cementing their position as the leading provider of talent on a global basis. By forming an exclusive alliance with Live Nation, we are ensuring that our distribution channels will be filled with a steady stream of live concerts from the greatest artists in the world."

Mechanical Royalties Redux

This is the money that must be paid to the owner of the (composition) copyright every time a physical copy is made of any record containing that composition.

That means for every actual piece of vinyl, 8-track or cassette, a certain amount must be paid the copyright owner (usually the composer). Excluding use for broadcast, hence all the specifically marked "promo only" stuff. The artist never gets paid for those copies. Nor do they get money when their (major) label gives bunches of those records to Record and Tape Clubs. They are considered promotional copies, given to those companies as a "reward" for buying a certain amount of another artist.
By US law, this right cannot be assigned to the label ! So usually in a recording contract, the label bargains a lower rate (usually 2/3 or 3/4) that it must pay the composer. Again, this is a lot of paper work, small labels usually just roll this archaic stuff into a decent royalty rate.

The reason I call this archaic, is that it is grown out of an old system where the composer, arranger, performer, and label are very distinct entities.

US

In the US, the Harry Fox Agency is known for collecting and administrating Mechanical Licenses.

UK


Mechanical Copyright Protection Society (MCPS)
http://www.mcps.co.uk/

You will need to obtain a license with MCPS before a UK pressing plant is allowed to proceed with manufacturing.

ArtistDirect Lines Up Lyrics Site

ArtistDirect is getting on the lyrics bandwagon, with plans to launch a new interactive lyrics page on the company's Web site. The site, which is expected to go live sometime this fall, is designed to augment the company's existing stable of news, bio, reviews and streaming music and video content.

Unlike other authorized lyrics services that have emerged in the past year, ArtistDirect is pursuing its own licensing deals with music publishers rather than using pre-aggregated lyrics licensing programs such as that by Gracenote.

The company presently has deals with Universal Music Publishing Group and EMI Music Publishing.

Artist Quote of the Week

"I've made hundreds of legendary records that people talk about that didn't sell." Jerry Wexler

Running a Label... Part II

Tactics

If you are a musician yourself, it is always better to start putting stuff out on other people's labels and then move onto your own once you have a bit of recognition. Getting excepted by a distributor will be HARD, and its getting harder. They want to work with people that have some kind of profile, not just a competent record. Distributors are steadily disappearing and your back catalog and balance due tends to disappear at the same time. Independent record stores are evaporating. On the other hand, the Internet is still exploding for Independent labels, and promotion has never been easier. Independent music may be down and it may be up again in a few years.

Cuts and Style

You will need a bunch of slamming tracks. Decide what you want the label to cover. Often, records are bought without having heard them, based on reputation, previous releases or curiosity. Erraticness or unpredictably will hurt your sales, as will blandness and predictability. Get an angle, work it. Think about what you look for in a label or record when you buy.

Capital and ambition

You will need some money to start with. You will make some money, but it will be hard work. If you just wish to make money, get a job, it will be easier.

Music Musing

Does that band from Wichita, Kan., really have 42 million MySpace fans? Are free music Web sites a solid business model? How do I reach that lucrative market of older music enthusiasts?

Execs from Pandora, Imeem, Kyte and hundreds of others from the music and digital industry are getting together this week at the Bandwidth conference in San Francisco to discuss just such issues.

The annual gathering looks at how people discover, interact with and, most importantly, spend money on music.

Speakers include Alexandra Patsavas of Chop Shop Music, who selects the music for television shows such as "Grey's Anatomy"; Jonathan Poneman, co-founder of Sub Pop Records; and executives from YouTube, Microsoft, Benchmark Capital and Cisco.

Running a Label ...Part I

Once upon a time this resource centered itself on the mechanics of starting your own label. I encourage you to think carefully before starting down this path. There are too many labels out there right now, the market is shrinking and for you to get the label properly noticed and accepted, you should be able to undertake this step with a proper and informed focus.

Starting a label is definitely not something for an industry beginner to undertake.

You should not start a label just because:

1. you as an artist have been turned down by other labels

Either you have not sent your stuff to the right labels, you need more time to develop, or you are doing something no-one else understands or cares about.


2. you think you will earn money.

Only if you really know what you are doing and put a lot of visionary effort into it. Getting a normal job is easier. Chances of losing money are fairly good. It happens. Usually.




You should start a label because:

1. You regard it as a work of art, an extension of making music

2. You see it as a way to promote your DJ-ing or live shows and are prepared to put money into the label

3. You like shopping at office supply stores and find fax machines and ring binders inspiring

4. You can't make music at all but you want to be involved and spread music and have something to contribute

5. You just want something to talk about while you are hanging out at shows sitting behind the merch table

6. You are just biding your time until you can diversify into train lines, jet planes and near-orbital space travel



This guide will attempt to be thorough and informative, but if you are actually going to start a label, I advise that you get in contact with people who have already done it and get some person to person advice.U

Artist Quote of the Week

Let me handle my business, damn!"

- Jay Z.

Demos 101

The basics are to choose maybe 6 labels of different calibers and styles. You should look for opportunities on small labels. Larger labels watch the smaller labels for new talent. The larger labels are getting so many demos a week, they don't simply don't have the time to really listen to everything. In general, they are already in contact with the people they are likely to sign in the future. In order to be one of those people, you have to develop yourself as an artist and rise to that situation.

Choose labels you spin or that other people spin. Sit down with boxes of records and take notes. Either fax them or ask on the net for addresses. Starting a relationship with a small label is all about making friends. Look at how the label looks and find someone who reminds you of yourself (same attitudes) except more advanced and established. Sending it to the wrong label is not a big deal. Sending it to the TOTALLY wrong label is just a waste of time. Never try to second guess what the label guy thinks, just let him or her listen to it if they get a chance. Some label people I know just love listening to tapes. Even when they know they won't put it out, they still sit around and listen to them. Some people just fast forward through it and decide immediately. Some people will never even listen to your tape. You don't have to call them and bug them (maybe once, but just to
say hi), just keep sending stuff out and see what happens.

Don't get hung up on pass or fail bullshit. It can be good material but sent to the wrong label, it could be you aren't ready yet. The label might like it, put it out and its still crap. Why trust them more than yourself ? You might hate the record in 6 months. You can put out crap and you can fail to put out good stuff. Don't do either. Do send out demos though. Very simply : put it on a CDR with clear labeling. Some labels feel that if you spent time on the graphics, you probably care more about what you are doing. Some labels just want to hear the music. Properly labeling stuff is important. Put your address and telephone number on it. Wait. Send out more demos every-time you have a batch of material you feel strongly about.

Australian Biz Faces 5-Year Decline

The Australian recorded music market will continue to contract over the next five years, according to gloomy new analysis from PricewaterhouseCoopers (PWC).

The consultancy today (Aug. 5) released the latest edition of its annual Australian Entertainment & Media Outlook, which examines issues that will influence the local industries through to 2012.

In its music analysis, PWC states that the recorded music market fell by 10.6% in 2007 and this year will decline a further 6.8% to be worth $795 million Australian ($729 million) at the end of 2008. All told, the consultancy expects the market to contract at a compounded annual growth rate (CAGR) of 1.5% through to 2012.

According to PWC, the "rapid decline in physical recorded music sales is not matched by the growth in digital music downloads and ringtones". The fall in the volume of CDs sales plus discounting by retailers is also impacting margins, the report adds.

PWC believes that the overall Australian entertainment and media sector will continue to enjoy growth and by 2012 will be worth $31.2 Australian billion ($28.6 billion). However, David Wiadrowski, lead partner for technology, information, communication and entertainment, says the sector must continue to innovate if it is to ride out the current economic downturn.

"If entertainment and media businesses were to enter the difficult days ahead without thoughtful, innovative strategies to maintain share, it could be harder for them to recover than from a cyclical economic downturn," he says.

Music industry ‘should embrace illegal websites’

The music industry should embrace illegal file-sharing websites, according to a study of Radiohead’s last album release that found huge numbers of people downloaded it illegally even though the band allowed fans to pay little or nothing for it.

“Rights-holders should be aware that these non-traditional venues are stubbornly entrenched, incredibly popular and will never go away,” said Eric Garland, co-author of the study, which concluded there was strong brand loyalty to controversial “torrent” and peer-to-peer services.
EDITOR’S CHOICE
Guitar Hero aims to take on iTunes - Jul-10
Media and tech stars mingle in Sun Valley - Jul-10
Tech blog: Matthew Garrahan - Jul-10
John Gapper: The music labels can take a punch - Jul-02
Warner signs up for Nokia’s music service - Jul-01
Sony BMG joins Nokia’s all-you-can-eat music service - Apr-22

Radiohead’s release of In Rainbows on a pay-what-you-want basis last October generated enormous traffic to the band’s own website and intense speculation about how much fans had paid.

He urged record companies to study the outcome and accept that file-sharing sites were here to stay. “It’s time to stop swimming against the tide of what people want,” he said.

The study by the MCPS-PRS Alliance, which represents music rights holders, and Big Champagne, an online media measurement company, found that legal downloads of In Rainbows were far exceeded by illegal torrent downloads of the album.

Almost 400,000 illegal torrent downloads were made on the first day and 2.3m in the 25 days following the album’s release, compared with a full-week’s peak of just 158,000 for the next most popular album of the period.

“The expectation among rights-holders is that, in order to create a success story, you must reduce the rate of piracy – we’ve found that is not the case,” said Mr Garland, chief executive of Big Champagne, who highlighted the benefits that Radiohead received from the album’s popularity, including strong ticket sales for its concerts this year.

The findings could add impetus to rights-holders’ efforts to license digital services that are at present beyond their reach, following the pattern of the MCPS-PRS Alliance’s recent move to license YouTube, the Google-owned online video-sharing site.

“Developing new ways and finding new places to get something as opposed to nothing” was important, said Will Page, MCPS-PRS chief economist and co-author of the report.

Those new places could be peer-to-peer sites or internet service providers, he added.

Record companies should ask themselves: “What are the costs and benefits of control versus the costs and benefits of scale?” said Mr Page.

He also challenged the assumption that no other band could achieve the same benefits, saying Radiohead’s experiment had reduced the marginal cost and risk for those following their lead.

He described the launch of In Rainbows as “stunt marketing at its best”.

Copyright The Financial Times Limited 2008

Artist Quote of the Week

The music industry is a strange combination of having real and intangible assets: pop bands are brand names in themselves, and at a given stage in their careers their name alone can practically gaurantee hit records.

Richard Branson

HFA - mechanical licenses for cover songs

"Songfile" can be used by musicians who plan to make and distribute 2,500 copies or less of their recordings to obtain the necessary licenses for cover versions of songs. Licenses can be obtained for CDs, cassettes, LPs, or permanent digital downloads (DPDs).

Customers can create an account with the Songfile service, search HFA’s catalog of almost 1.9 million songs, and complete their mechanical licensing transaction in minutes. Royalties are calculated at the statutory mechanical rate (currently 9.1¢ per copy for songs 5 minutes or less in length, or 1.75¢ per minute (or fraction thereof) per copy, for songs over 5 minutes). There is also a nominal processing fee ($13-15) on each song licensed.

Best Buy To Open In-store Music Centers

Hoping to cater to everyone from the garage guitarist to a recording musician, Best Buy Co. Inc. is announcing a massive new initiative that sets aside store space for an array of musical instruments and gear in dozens of sites nationwide.

The nation's largest consumer electronics retailer will announce Tuesday that it plans to open as many as 85 of the music centers inside its stores by the end of the year and could add even more locations in the future, executives told The Associated Press.

Each site will use about 2,500 square feet of retail space and include roughly 1,000 different products with well-known brand names such as Fender, Gibson, Drum Workshop and Roland.

"We're not just extending the shelf space in the store, we're creating a designated area specifically for this experience," said Kevin Balon, the company's vice president of musical instruments. "And we're trying to create an authentic and genuine musical instrument store look and feel inside of Best Buy."

The Richfield, Minn.-based retailer - already an industry leader in sales of everything from digital cameras to video games - will use its headfirst jump into the $8 billion U.S. musical instrument market to carve out new revenue opportunities as sales of CDs and DVDs slow, experts said.

When the rollout is complete, Best Buy - already considered by many investors to be a global powerhouse in the electronics retailing world - will become the second-largest instrument seller in the country based on locations.

But some observers are cautious about whether the expansion efforts will reap big rewards, particularly as the nation's economy slows and consumers become even more particular about spending hard-earned paychecks.

"It's not a high-growth area and it's obviously going to take up a lot of real estate," said Morningstar retail analyst Brady Lemos.

Executives declined to comment on how much the company is investing in the project or how much they expect to gain from the store-within-a-store effort.

So far, ten sites are already open, including five in California, two in Illinois and two in Minnesota.

Best Buy's selection will include everything from accessories - picks, sheet music and cases - to high-end basses, guitars, keyboards and DJ equipment. Instruments will be housed in separate rooms and the company also plans to offer group music lessons.

Acoustic guitars will sell between $89.99 and $3,200 and drum kits will retail for as much as $5,000.

A selection of the offerings will also be available online in early August.
"However you want to play, if play means you're just learning and you want to play with a bunch of buddies, or you want to play on stage, we can support any of that," Balon said