Verizon Wireless saw the number of its music and video downloads increase 16.3% in Q4 of 2008, according to today's press release. That comes out to about 50 million downloads versus 43 million downloads in Q3.

The number of Verizon retail subscribers increased 1.7% to 70 million (which means each subscriber averaged fewer than one download). The number of picture and video messages sent by subscribers increased about 20% to 1.8 billion.

As usual, no information was given on the number of subscribers to its music service. Over-the-air downloads mentioned by Verizon are tracks purchased for $1.99. The Rhapsody-powered VCast music subscription service requires users to transfer subscription tracks and personal music files to the handset from the PC. Subscription tracks cannot be downloaded directly to the handset.

Posted by Glenn at 5:16 PM | Link
|Mobile Music|

Since Rhapsody started powering Verzion's VCast mobile music service, downloads have improved substantially. According to press releases for quarterly earnings announcements, Verizon Wireless customers "completed" 43 million audio and video downloads in Q3 2008, a 17.8% improvement over the 36.5 downloads in Q2 (the quarter in which the partnership took effect) and a 24.3% improvement over the 34.6 million bought in Q1. During that span, the number of total Verizon wireless subscribers increased only 5.4%.

Over-the-air downloads mentioned by Verizon are tracks purchased for $1.99, not subscription tracks. The Rhapsody-powered VCast music subscription service requires users to transfer subscription tracks and personal music files to the handset from the PC. Subscription tracks cannot be downloaded directly to the handset.

The increase in downloads could be an indication that VCast has more subscribers or that the new service is better at enticing users to purchase music (the former is the more likely). Verizon did not break out the number of subscribers to its VCast music service in its recent earnings release. Rhapsody has not yet given details on new VCast subscriptions but has publicly said they are happy with the early results. "Sign-ups for the first month have been very encouraging, exceeding our expectations," RealNetworks CEO Rob Glaser said in the Q2 2008 earnings call.

Posted by Glenn at 12:43 PM | Link
|Mobile Music||Rhapsody|

Nokia is expected to unveil the Tube, a touchscreen phone, at a music-themed event in London tomorrow. It is believed the phone will include the anticipated Comes With Music unlimited subscription service.

Wall Street Journal: "The device, which will be called the Nokia 5800, emphasizes music first and is more of a multimedia player than a full-blown smart phone."

PC World: "Motorola is hoping to stem its recent financial bloodletting by throwing its might behind the popular Android operating system. It's betting that Android is the mobile OS of the future and has reportedly begun to assemble a 350 team of Android developers to transform its mobile business."

Forbes has a brief article on the Tube.

Engadget has a decent close-up picture.

Posted by Glenn at 11:15 AM | Link
|Mobile Music||Nokia|

Today's music industry is often one step forward, one or two steps back. As progress is made in new formats, products and services, revenue is lost in the abandonment of older formats and products. With unlimited mobile music services on the horizon, now is the time to ponder their impact.

TNS Technology surveyed over 1,000 people aged 16-64 about unlimited mobile music services. The results hint that consumers' adoption of one technology is likely to have implications for other technologies. If they were to subscribe, the survey found, 45% would buy fewer CDs and 47% would buy fewer digital downloads. The survey is described in this article at The Guardian.

The billion-dollar question is, How many fewer CDs and downloads would you purchase? The article offers no indication, and answers would be guesses that couldn't carry too much weight. Respondents did, however, offer estimates on how many tracks they would download in a month. The average across all answers was 64 tracks. Respondents between 16 and 24 said they would download almost twice as many.

In their rush to push consumers to new digital services, labels may end up undermining their bread and butter product, the CD. To what degree CD sales will be negatively affected is unknown, but any prudent company should expect a decline. If services like Nokia's Comes With Music were to explode in popularity, the ripple effect that will hit retailers -- especially brick-and-mortar retailers -- could be substantial and could further reduce the amount of shelf space retailers give the CD (and, in some cases, further threaten the existence of some pure-play music retailers).

At the heart of the matter is the ongoing debate of substitution versus promotion. Do music services spur additional music sales or act as a substitute for purchases? Economist Stan Liebowitz has authored two papers that point to evidence that, as one paper put it, "listening to music radio is a substitute for non-specific music listening that might otherwise have used sound recordings."

The National Association of Broadcasters takes the other side of the argument and touts the promotion radio offers record labels. For what it's worth, the NAB's study on the promotional benefits of radio was funded by the NAB.

The record industry is aware of the issue and is leery of the substitution effect. In his October 2006 testimony before the Copyright Royalty Board, an executive for Sony BMG said "virtually all digital services are substitutional to some extent" and that satellite services "appear to be deeply substitutional."

Subscription downloads are a far better replacement for purchases than are subscription and terrestrial radio services. Again, it's difficult to predict the degree to which subscribers will cut their purchases. Even if they do, a subscription gives content owners more than the average American consumers' annual recorded music spend. The opportunity lies in the net gains from signing up light buyers. According to NPD, the average U.S. Internet user spent only $38 on music in 2007. A person who buys few CDs or downloads -- or none at all -- will become a much more profitable customer when signing up for an unlimited service. That's practically found money. There are far more light users than heavy users and thus they would hold great payoffs, but light users purchase less music for a reason. They're not as involved in music, don't place much value on it and, it stands to reason, would be less likely to pay for an unlimited mobile music subscription. The record industry would be best served if mobile music service can reach those light users.

Posted by Glenn at 5:38 PM | Link
|Mobile Music|

Sony Ericcson has announced its plans for its unlimited mobile music service. PlayNow Plus will launch with mobile operator Telenor in Sweden by the end of the year. A special edition of the W902 Walkman phone will be the first participating handset. The service will be available globally next year.

According to Reuters, the service will cost 99 Swedish crowns (US $15.24) a month. Subscribers can download an unlimited number of tracks to the handset or to a PC, using the PlayNow Plus Desktop. The handset will sync with the PC using broadband and 3G/HSDPA connectivity.

All four majors and many independents (none were singled out by name) are said to be on board.

There are differences between PlayNow Plus and Nokia's upcoming Comes With Music service. PlayNow Plus will allow users to keep 300 songs in a DRM-free after the term of the subscription has expired. This press release says subscribers can keep their "most-played" music tracks. My question is, Why do you have to wait until the subscription expires to get those MP3s?

Both have DRM. PlayNow Plus uses eAAC Plus format with highly compressed files for faster transmission. Comes With Music boasts it will allow users to keep all downloaded songs, but the tracks will be wrapped in Microsoft's WMA DRM. Both services allow for unlimited downloading during the service term.

PlayNow will allow for a la carte track purchases through its PlayNow Arena, the mobile music store that was re-launched last month. At the time of the re-launch, tracks were priced at 9 Swedish kronor (US $1.40) apiece.

PlayNow goes a few steps further with some social networking aspects, music news and charts. I'm curious to see exactly how Sony will incorporate the services of Gracenote, which it acquired earlier this year.

Another difference will be evident right out of the box. PlayNow Plus-enabled handsets will come bundled with up to 1,000 pre-loaded tracks. I don't care much for the song selection of pre-loaded devices, but other people might.

On paper, PlayNow Plus looks like the better deal. During the term of the subscription, both services are fairly similar. But PlayNow Plus handsets come with tracks, and the value of the MP3 tracks kept at the conclusion of the subscription probably has a retail value in excess of the cost of the plan. And although EMI will eventually get on board with Nokia's Comes With Music, it has already licensed its catalog to Sony Ericcson.

That's on paper. On paper, many services and devices look great but end up being hampered by poor user experience. The Zune has long looked good on paper but still lags behind the iPod and SanDisk players. Even the MusicGremlin looked good on paper. The devil is always in the details. And it's in the timing. The product needs to be timed to match the public's readiness for this type of product. And it's in the product's ability to fit with consumers' expectations. That's the iPod factor. People love iPods. Will they fit a second music player into their lives?

Posted by Glenn at 4:16 PM | Link
|Mobile Music|

As VentureBeat pointed out yesterday, Pandora has added advertising to its popular iPhone application. VentureBeat called the ads "unobtrusive" and described them as "simple overlays that reside right above the main navigation." Best Buy and Beck's beer are on board, and Pandora founder Tim Westergren told VentureBeat due to the unexpected level of the application's popularity he expects all advertising inventory to be taken soon.

Pandora, which had publicly fretted about royalty rates, is probably breathing easier after today's announcement of an agreement on Internet royalties between all the major parties.

For more on Pandora, watch the interview with Westergren at this April 2007 post at iinnovate.

Posted by Glenn at 1:32 PM | Link
|Mobile Music||Online Stores/Services|

As you learn about Google's Android mobile operating system, which is run on the Google G1 phone (read Walt Mossberg's review from today), keep an eye out for music-related potential. One app I like is Compare Everywhere, which allows users to compare prices, create shopping lists and keep wish lists.

The app works by taking a picture of an item's UPC and looking up product information. While Compare Everywhere can be used for fast price comparisons, I think it will be valuable for finding information on albums while digging through a record store's bins or flipping through vinyl at a yard sale. Is the album worth the money? Is it from the band's misguided psychedelic phase? Who were the band members on the record? Compare Everywhere should be able to help, and it's well timed for the resurgence in vinyl.

As for the stock music functions on the G1, Mossberg says it comes with a "very basic" music player (no video player) and said the Amazon.com application as "works fine" (songs are downloaded over Wifi, not T-Mobile's network).

Posted by Glenn at 11:34 AM | Link
|Mobile Music|

In its Q2 highlights issued today, Verizon offered some numbers for mobile music and video. Subscribers completed 36.5 million music and video downloads in the quarter ending June 30. (Verizon ended the quarter with 66.7 million retail customers, and estimates have put V Cast participation at 7% to 10%.) Verizon did not break out music and video numbers.

That's a 5.5% increase from the 34.6 million downloads in Q1. During that same span, subscriber growth was up 2.3%. The number of downloads in Q2 2008 was a 46% increase from the 25 million downloads in Q2 2007. That's good growth, although mobile downloads are tiny relative to online downloads.

The RIAA puts the trade value of mobile single track downloads at $44 million for 2007. That's trade value, so total consumer spending was at least twice that.

Verizon teamed with Rhapsody (to power its V Cast service) during Q2 but too late in the quarter to make a difference in the numbers. We'll be able to see evidence of Rhapsody's impact in Q3.

Posted by Glenn at 9:12 PM | Link
|Mobile Music|

Yesterday eMarketer released a report with mobile music revenue forecasts through 2012. The title, "Mobile Music Searches for Hit Formula," says it all because the winning formula has thus been very elusive.

Global mobile music spending, predicts eMarketer, will total $3.3 billion in 2008 and to $4.5 billion in 2009. The figures exclude monophonic and polyphonic ring tones and include major markets such as the U.S., Japan, China, UK, Spain, Germany and South Korea (but excludes many significant markets like Australia, Russia and Brazil).

eMarketer predicts ad-supported mobile music to grow at a smokin' compounded annual growth rate of 53.4% through 2012. "Marketers will account for a greater proportion of that overall spending as the ad-supported model for mobile music gathers steam," said John du Pre Gauntt, the analyst who wrote the report.

According to M:Metrics, only 5.7% of mobile phone users in the U.S. listened to music on their mobile phones in November 2007. The majority of music on the mobile phone was sideloaded from a PC. In January 2008, says M:Metrics, the percentage of U.S. mobile phone owners that used the device to listen to music was 6.7%. But 28% of smartphone owners used their devices for music, and 74.1% of iPhone users used the device to listen to music.

If current U.S. trends are any indication, mobile subscriptions will struggle to remain relevant and sideloading will be the prime source of songs on mobile devices. The current generation of services don't look like they're going to move the needle any time soon. The most popular mobile music apps will be free services like Pandora and last.fm on Internet-ready devices (they're off to a great start at the iTunes app store). Nokia's Comes With Music is a wild card and will test the degree to which people can base their digital music acquisition on a mobile device (as opposed to the PC). It's most likely that a Nokia service will be a complement to, not a substitute for, existing music acquisition and listening for the next handful of years.

In its Recording Industry In Numbers 2008 report, the IFPI put the 2008 global digital market at $2.9 billion (in trade dollars, not total consumer spending).

To talk about digital and mobile music in terms of a global market, though, misses the differences between markets. (The eMarketer report breaks down global revenues by markets. The free preview does not show the separate charts.) The thing to understand is markets differ radically when it comes to mobile patterns. In the US, ring tones and mobile downloads account for under 10% of total digital trade revenue. In Canada they total about 12%. In Japan, mobile single tracks account for 45% of trade revenue from digital music, and ring tones (both master ring tones and ringback tones) account for 42%. In South Korea, streams represent 25% of trade revenues from digital music, subscriptions 13% and mobile single tracks only 3%.

Posted by Glenn at 3:41 PM | Link
|Mobile Music|

The title is about as excited as I can get about Omnifone's MusicStation mobile music service, which got a pretty thorough review by Listening Post. It sounds great. Downright promising. I can't say what it will take to get me on board mobile music -- nothing has piqued my interest enough to jump in -- but MusicStation appears to be a step in that direction. MusicStation launched last month in the U.K. It is not yet available in the U.S.

Extra credit reading:

• PhoneContent.com: "Omnifone's MusicStation goes live"
• The Guardian's Technophile blog. "Pros: Intuitive, cheap, good range of tracks, 'community.' Cons: Sucks up batteries: your phone needs regular recharging."

Posted by Glenn at 4:57 PM | Link
|Mobile Music|

An interview with Omniphone CEO Rob Lewis at paidContent:UK offers a peek at the MusicStation mobile subscription service. I'm terribly interested in this particular mobile service, which looks to have a better than average chance of moving the needle. (Keep in mind that an average chance for a mobile service is still pitifully low.) Half a million downloads in ten days is a decent start.

The juicy stuff is in the "How It Works" paragraph:

The handset maker pays Omnifone a fee for including its service. The mobile network then pays the phone maker and could add a specific 'music plan' alongside data tariffs. Royalties are paid on a per-play basis rather than for each download (Lewis reckons it’s fairer) - tunes plucked from free-access services count in a separate UK 'play chart'. Tracks take an estimated 30 seconds to download over 3G and can start playing before the download finishes. The number of tracks users can download is limited only by the size of their memory card. Users also get their song library on the desktop because new tracks downloaded to the mobile (AAC+ format) are also pushed down over wired broadband (format yet to be announced).

Lewis predicts a record industry resurgence in the next 12 to 18 months. "All of the music labels are definitively of the view that their time has come and this brave new chapter of delivering unlimited services over the network is the key to that revival."

We shall see.

Posted by Glenn at 9:26 AM | Link
|Mobile Music|

Interesting post at MocoNews from the World Mobile Congress. Rob Wells, Universal Music Group SVP of Digital, talked about the goals of the company with an almost cinematic flair.

The start and endgame for Universal and, indeed, the industry worldwide, is providing consumers with blanket access through a celestial jukebox anytime, at home, in the car. This is the next step in the utopian future for music...

And this about temporal pricing:

If an artist has just delivered an album from studio, we could potentially deliver it to a limited number of users for a higher price. It’s something we’re quite keen to develop; for example, through our own B2C channels - artists websites.

There are different definitions of "utopian future." UMG sees paid services as the future, as evidenced by its Total Music plan and Nokia's Comes With Music mobile service.. Others see the best route as unhindered P2P, which would certainly have more content and would be closer to a true celestial jukebox.

The pricing comment is worth taking a look at. Labels have yet to do a whole lot of direct-to-consumer stuff (other than merchandise) but that should change. Fan clubs and artist websites offer ways to deliver music and bring a sense of scarcity to digital downloads. If the iTunes and the Amazons of the world won't raise their prices for time-sensitive releases, artists and labels can go it alone.

Posted by Glenn at 2:37 PM | Link
|Comes With Music||Mobile Music||Total Music||Universal Music Group|

• The New York Post got its hands on a confidential investor presentation in which EMI owner Terra Firma outlines its plans to improve its position in the music company. Highlights: Terra Firma is looking for $223 million in fixed costs savings (mostly in recorded music); it plans to cut $31 million from sales and distribution; it expects to save $58 million in A&R costs by utilizing social networking websites to find and promote artists; and it hopes to improve cash flows by 766% over five years by taking advantage of improved digital and mobile margins. In addition, Terra Firm has set aside $100 million for acquisitions of smaller indie labels. That's quite a wish list. (New York Post)

• The new Microsoft Zune devices officially launch today, but there was a lot of coverage yesterday. Engadget compiles some (positive) reviews of the updated portable media player. As always, most of the fun is in the comments. (Engadget)

• Silicon Valley Insider wonders how low Warner Music Group's stock can drop. Pali Research's Richard Greenfield, who just helped prompt a drop to his target price of $7.50, has now set a target at $5.00. Greenfield is worried about the loss of CD shelf space after Christmas. Is that really the only reason for the lower target price? That should have been built in a while ago since we've known for a while -- and has been speculated for eons -- that labels are going to get less love from the mass merchants and chains after the Christmas selling season. No secret there. (Silicon Valley Insider)

• Music-oriented social networking are the new social networking sites, which were the new coffee houses, which were the new bagel shops, which were the new video arcade/ice cream parlor. Here's an article on Cyloop.com, which has deals with Warner Music Group and The Orchard and plans to wrap up Sony BMG and Universal Music Group by the end of the year. Unlike most social networking site,s Cyloop has a niche: the Hispanic market. (Miami Herald)

• Warner Music Group chief executive, Edgar Bronfman Jr., is warning mobile operators to improve their music offerings or lose ground to the likes of Apple and Google. "With Apple's iPhone innovation and Google coming in, if the mobile phone industry doesn't respond with highly competitive offerings, they're going to watch their share of the opportunity diminish," he said. And as operators' share of the opportunity wanes, so do labels' fortunes. (Financial Times)

• For you lawyer types or those simply interested in RIAA lawsuits: "Examining Hard Drives During Discovery." Here's a sample: "The right to examine the contents of an opponent's computer hard drive has been categorized as unusual relief, yet can prove valuable during the discovery process. Nonetheless, under the federal rules, courts will not, as a matter of course, grant a party's demand routinely. Rather, imaging is generally permitted when there is a finding that an adversary's document production has been inadequate and that a hard drive examination could uncover omitted, relevant materials. In the absence of such a strong showing, courts can be reluctant to allow an examination, particularly given that hard-drive imaging can be a costly procedure that adds to the litigation expenses of all parties." (Law.com)

• Optimal's VinylDisc, one side vinyl and the other side CD, will be chart-eligible in the U.K. (mi2n.com)

Posted by Glenn at 9:03 AM | Link
|EMI||Mobile Music||Warner Music Group|

• Britney Spear's new album, Blackout!, is likely to debut at #1 on the album chart with first-week sales of up to 350,000. (Billboard.biz)

• At the final public hearing on media ownership, FCC Chairman Kevin Martin said he supports the easing of low-power-FM rules, allowing AM stations to operate on FM translators, reinstating tax breaks to minority investors and requiring that a radio station have a physical staff at all hours of operation. (Radio Ink)

• The National Association of Ticket Brokers issued a statement about the Hannah Montana ticket controversy. and pointed the finger at Ticketmaster and its secondary market operation, TicketExchange. The company, insists the brokers group, "actively encourages" consumers to buy and sell tickets on its secondary market exchange. (Ticket News)

• The U.K. Nokia Music Store is set to launch today. Users can buy tracks for 80p each ($1.60), buy albums for £10 to £12 ($22 to $24) or stream an unlimited number of songs for £8 ($16) per month. The service downloads tracks to Nokia N81 and N95 8GB mobile phones as well as the user's home PC. (Webuser)

• As was previously rumored, the CD version of Radiohead's In Rainbows will be distributed by XL Recordings outside of North America. (Hollywood Reporter)

• If you noticed some fancy cars in the video for 50 Cent's "Amusement Park" video, they were part of the marketing deal the rapper inked with General Motors. The Pontiac G8 -- a one-of-a-kind custom -- and G6 GXP were placed in the video to help spotlight new Pontiac models. So add cars to the long list of projects for 50 Cent: Recorded music, concerts, a movie, two autobiographies, Vitamin Water advertisements... (SOHH)

• Guitar legend Robert Fripp lambastes EMI over sales of King Crimson downloads after the license period expired. (The Inquirer)

• A Q&A with imeem.com's chief executive and chief marketing officer. "We think our direct ad sales from brand sponsorships and our multiple ad network partnerships will be our primary sources of revenue. We’ll also have commerce-related offerings, like digital downloads and ringtones. Right now we are the #1 iTunes affiliate partner." (New York Times' Bits blog)

Posted by Glenn at 8:57 AM | Link
|Mobile Music||Radio||Ticketing|

• Album sales increased 5% last week but were 17% lower than the same week last year. Carrie Underwood's Carnival Ride debuted at #1 with sales of 527,000 units (9% digital). For the year, album sales are down 14%. Sales of digital tracks dropped 2% last week and were 38% higher than the same week last year. Chris Brown's "Kiss Kiss" was the top digital track again last week, with sales of 187,000 units. For the year, digital tracks are up 46%.

• Sony BMG UK is the last of the four majors to sign on with Cliq, a music purchase system that will allow -- on 85% of U.K. mobile phones -- users to buy music when they hear it streamed on their mobile phones. (Thomson Financial)

• Though the Sony BMG merger passed a second European Commission review, a member of the European Parliament has questioned the commission's reasoning. Said Guy Bono, member of the Committee on Culture and Education, "The European Parliament is exercising democratic control over European institutions by interrogating the Commission on the Sony BMG merge." He continued to say that "music suffers from chronic concentration" and that "cultural diversity" should be at the heart of EU policy. (Billboard.biz)

• The Forms gave away a copy of their new CD to each ticket buyer at last night's show at NYC's Cake Shop. And an open bar. Free music and free alcohol, a combination for an ailing industry. (The Forms, via Brooklyn Vegan)

• An interview with Trent Reznor, who is now free from his contract with Universal Music Group. "Radiohead is one of my favorite bands. When they announced they were releasing that album for free, I got dozens of text messages. It gave me goose bumps? It's such an exciting way to sell a record. ... I think there were some serious flaws with how they executed but it was a good idea." (News.com)

• A Maryland couple has ended its lawsuit against Wal-Mart stemming from obscene lyrics in an Evanescence purchased at a Wal-Mart store. The judge refused to classify the suit as class action. The couple settled with Sony BMG in 2005. A similar lawsuit is still alive in Illinois. (AP)

• It's hard to say much about a greater trend, so let's keep this as an isolated incident for now: a radio station in Hartford has gone back to alternative rock after switching to hip hop four years ago. Said the local operations manager for Clear Channel, "What we've been hearing since the [modern rock] format left the city, is ... that women and men between the ages of 25 and 34 in the Hartford area really don't have a radio station to listen to." (Hartford Courant)

Posted by Glenn at 8:32 AM | Link
|Mobile Music||Sony BMG|

• AT&T will offer Napster's catalog -- over five million songs -- available for wireless download next month. The service will not work with the iPhone even though the device uses AT&T for wireless service. Here's the bad news: songs will cost $1.99 each or $7.49 for five downloads per month. Slightly better news: mobile downloads come with a free-to-the-PC download. No word yet on the file format of either the mobile or PC downloads. It's good to see the growth of mobile music service, but I'd be surprised if this gains much traction. Its per-download price is not competitive for a market of sideloaders, and the service does not offer the all-you-can-eat music buffet for which Napster is known. I'm in agreement with Silicon Valley Insider: this pricing scheme is a non-starter. At the very least, this service gets AT&T up to speed with its competitors. (New York Times)

• Terra Firma's Guy Hands is hoping to sell off EMI's pension fund if it can get squared away with the Pensions Regulator over contributions. (This Is Money)

• Canada has set a tax of three cents for single downloads and one and a half cents for album track downloads. Personalized radio stations such as Pandora and last.fm will pay 6.8% of their subscription fees for the tax. (Radio Ink)

• Live Nation is reportedly in talks to buy merchandising company Signatures Network for $50 million. The company has the rights to license and market such artists as Bruce Springsteen and U2. (New York Post)

• The International Music Score Library Project, home to public domain musical works, has shut down after receiving a cease-and-desist letter from music publisher Universal Edition. (Slashdot)

• An article on EMI Publishing's new digs, a renovated 65,000-square-foot former textiles warehouse in Manhattan. Roger Faxon is using this space to get a formerly fractured staff under one roof and improve the way they work. "Faxon terms the system 'neighborhoods,' designed to encourage communication and collaboration between disciplines such as licensing, copyrights, and royalties." (BusinessWeek.com)

• CMJ is over. Here's a link to the New York Times' blog entries on the annual music festival. (Arts Beat)

Posted by Glenn at 1:27 AM | Link
|Mobile Music||Napster|

• Album sales dropped 6% last week and were down 17% versus the same week last year. For the year, album sales are down 14%. Kid Rock's Rock 'N' Roll Jesus debuted at #1 with the modest sum of 172,000 units (zero digital). Sales of digital tracks were flat last week but were up 56% over the same week last year. For the year, digital tracks are up 47%. Soulja Boy Tell'Em's "Crank That (Soulja Boy)" remained the #1 digital track last week even though the album sank 64% last week and fell to #16.

• Jean-Bernard Levy, chief executive of Universal Music Group parent Vivendi, told Reuters UMG will retain its superstar artists. In the wake of the mega-deal between Madonna and Live Nation, Levy predicted artists "feel good" working with UMG and mentioned that UMG is already signing artists to 360-degree contracts. (Reuters)

• Lime Wire will sell DRM-free INgrooves tracks at its upcoming digital store. INgrooves' catalog has about 100,000 tracks. (Press release)

• In an email sent out to its affiliates this morning, Amazon.com said it will pay its affiliates a 20% commission on MP3 sales through the end of 2007, and 10% thereafter. In comparison, iTunes pay affiliates only 5%. That will obviously hurt margins on sales generated by affiliates, as Silicon Valley Insider points out, but what percent of total sales comes from affiliates? Honestly, I have no idea but I can't imagine it being too great. Affiliate programs use a break-even or loss-leader strategy to get incremental revenue and convert that to future business. Don't be concerned about Amazon.com's music margins. This is the price of building awareness and repeat customers. (Silicon Valley Insider)

• Groove Mobile has inked a licensing deal with Redeye Distribution to offer Redeye's catalog -- which includes Yep Roc, Arena Rock and TKO Records -- though Groove Mobile's mobile music service. Groove Mobile powers the Sprint music store in the U.S. and 3UK's mobile music store in the U.K. (Press release)

• Nettwerk Records has joined with Passalong Networks and Digonex Technologies to create a variable-priced MP3 pilot program. Using Digonex's pricing technology, the price of Nettwerk MP3s will be adjusted weekly based on demand. Albums will range from $3.30 to $9.99 while singles will have three price points: $0.33, $0.66 or $0.99. Tracks can be purchased at Passalong's StoreBlocks site. (Press release)

Posted by Glenn at 1:01 PM | Link
|Amazon||Mobile Music||Universal Music Group|

• Amazon.com's digital music store could launch next week, which would put it right on track for the rumored date we heard a few weeks ago. Billboard.biz reports something that really stands out to me, that the new store will have four different price points. Antony Bruno wrote, "Amazon also is planning a tiered pricing scheme that will sell new releases at one price, and older tracks at another. In all, the Amazon digital service will have four pricing tiers, which major labels find attractive." We'll get to see if Steve Jobs is correct in his belief that tiered pricing is not simple enough for consumers. (Billboard.biz)

• Gracenote has acquired Musicphone technology to beef up its Mobile Music 2.0 song identification platform. The Gracenote mobile platform is linked to its global media database of over 80 million tracks. (Press release)

• SpiralFrog, currently bleeding money as it awaits its U.S. launch, has licensed INgrooves' catalog for its ad-supported download service. With those 100,000 songs, SpiralFrog should have about 1,800,000 now. (Press release)

• iBiquity Digital CEO Bob Struble on HD radio's last step to the mainstream: "From the technology standpoint, the FCC has adopted the standard, and the broadcast industry has built out the infrastructure. The last major hurdle – and it is not insignificant – is to get people to go into places and ask for HD Radio," "The goal is that about five years from now, when you go into a store and buy a radio, it will already have HD. ... For radio to continue to be as ubiquitous as it is, radio has to be on these devices. And it is up to all of the radio business – not just us." (Radio Ink)

• Here's a tidbit that's related to the constant copyright-vs-fair use debate in music circles: Much of the economic growth of the last ten years, according to a study released by the Computer and Communications Industry Association, can be credited to the doctrine of fair use. Fair use exceptions to copyright law, it estimates, account for $4.5 trillion in annual revenue for the U.S. economy, 18% of growth and 11 million U.S. jobs. (That's a huge number considering the U.S. has a GDP of $13.2 trillion. After scanning the report, it looks like the authors include an industry's total revenue even though only part of it relies of the fair use doctrine. Keep in mind that this report was comissioned by a non-profit trade group of which Google is a member.) Download the PDF of the 45-page report here. (InformationWeek)

• The Washington Post's Marc Fisher has a good overview on the recorded music industry's push to receive royalties for terrestrial radio play and lawmakers' plan to push through legislation to grant them those royalties. (Washington Post)

Posted by Glenn at 11:07 AM | Link
|Amazon||Mobile Music||Research|

• As part of the 100-day plan of new Yahoo CEO Jerry Yang, Yahoo Music is expected to be trimmed and its subscription music service could be retooled or shut down completely. (Reuters)

• Antitrust lawyers insist the new line of iPods indicate Apple is as anticompetitive as ever. Coughlin Stoia Geller Rudman & Robbins and other lawyers have a class-action lawsuit against Apple over its "anticompetitive products." The issue is the iPod's inability to play protected formats other than its proprietary FairPlay protected AAC format. A court date has not yet been set. (Wired)

• The Times Online profiles Rough Trade Records and looks at what the influential indie has done since it teamed up with Beggars Banquet. "We’ve got the first solo album from (the former Cocteau Twins vocalist) Elizabeth Fraser, new work from the Strokes and Belle and Sebastian; Antony (and the Johnsons) is making a new album, Green (Gartside) is working hard on a new Scritti Politti record and Sufjan is making a new record. Which state? He hasn’t revealed that yet.” (Times Online)

• Following LiveNation's entry into the Facebook widget scene, TicketLeap.com now has a widget that will allow Facebook users the ability to sell up to 5,000 tickets to their own events. TicketLeap.com caps each ticket price at $200. (Ticket News)

• Vodafone U.K. has unveiled its new music service. MusicStation, a collaboration with Omnifone, will allow users to download an unlimited number of songs from a catalog that includes all four majors. The service costs ₤2 ($4) per week. That's more than an annual subscription to either Rhapsody, Napster or Zune. (MarketWatch)

• Indie label firm PIAS Group has acquired a 50% stake in mobile marketing and distribution company Indie Mobile. PIAS looks at the deal as a tool to better serve its roster of over 400 labels. Five-year-old Indie Mobile offers such services as mobile licensing, content creation, retailing and marketing. (Billboard.biz)

• Try as I might, I just don't have much of an opinion on the ringle format. Billboard's Ed Christman calls ringtones a "phenomenon." Christman knows his stuff, but aren't ringtones stagnant? If ringtones weren't a stagnant format, would labels be putting them on physical discs and selling them in national retail chains like Wal-Mart and Target? No. But hey, leave no stone unturned. P.S. Somebody start a ringle Wikipedia page. The only current ringle page is for Ringle, Wisconsin. (Billboard)

Posted by Glenn at 10:22 AM | Link
|Mobile Music||Online Stores/Services|

• Album sales dropped 5% last week and were 19% lower than the same week last year. For the year, album sales are 14% lower than last year. High School Musical 2 topped the chart for the third straight week even though it dropped 43% to 210,000 units. Casting Crowns' Altar & The Door was the top debut with 129,000 scans. Sales of digital tracks dropped 7% last week and were 31% higher than the same week last year. Digital tracks are up 47% this year.

• New owner Universal Music Group has decided to close Sanctuary's UK recorded music division. Said Universal, "In consultation with senior management of the Sanctuary Group, it has been decided that its Sanctuary Records UK division will no longer continue as a stand alone, front-line record label." (BBC News)

• Groove Mobile received $6 million in funding from ORIX Venture Finance to aid its expansion. (Press release)

• Target has landed another exclusive: “Live From SNL! Music Performances From Saturday Night Live," a collection of musical performances from the last four seasons of the show. The CD will retail for $13.98 and have recordings of Maroon 5, Kelly Clarkson, Foo Fighters and others. (Billboard.biz)

• Congress will hold hearings on media stereotypes and the degradation of women. Rep. Bobby Rush, the chairman of the House Subcommittee on Commerce, Trade and Consumer Protection, will hold the hearing on September 25. On the witness list so far are Universal Music Group's Doug Morris, Warner Music Group's Edgar Bronfman, Philippe Dauman of Viacom and rapper Master P. The event is currently titled "From Imus to Industry: The Business of Stereotypes and Degradation." (Variety)

• He's back. Garth Brooks' "More Than A Memory" became the first song to ever debut at the top of the country singles chart. (Music Row)

• Reuters wonders about the 2007 album total. How much of this year's 14% deficit can the back-loaded release schedule make up? Eyes are on Tuesday releases by 50 Cent and Kanye West. (Reuters)

Posted by Glenn at 10:13 AM | Link
|Mobile Music||Universal Music Group|

• National retailer Borders Group reported a 10.4% increase in sales for Q2 2007. With the help of the latest Harry Potter book, U.S. comp store sales were up 4.6%. Music sales "continued to decline," though no hard number was given in the release. I listened to the conference call, and unless I zoned out at some point, music sales were not mentioned. (Earnings release)

• Music and video distributor Handleman reported a loss of $17.7 million for the quarter ended July 28, 2007. Revenues were up 14% even though last year's loss was only $5.9 million. The company's music category revenues decreased by $13.8 million versus last year. (Press release)

• Sony has another rootkit problem, this time from a USB drive that contained software that installs a hidden directory. (The Register)

• Jupiter's Mark Mulligan on Nokia's new mobile music store, Ova: "So was it worth the wait? Well the devices were, the latter two Xpress Music devices in particular from a music perspective. The three way sync is also a nice, innovative alternative to dual delivery. But beyond that, the music service is a disappointment. The music subscription service is a PC only streaming service that does not support portable downloads and as such is a generation behind current offerings. And it begs the question, why is a mobile handset manufacturer launching a music subscription service which does not support portable downloads or mobile streaming? Similarly the download service is essentially a ‘me too’ offering, based around 99 cents, windows DRM wrapped single track downloads." (Mark Mulligan's blog)

• Ween has signed to Rounder Records.

• Curb Records has signed 16-year-old Ashley Gearing, who is in studio with producer Bryon Gallimore. (Country Standard Time)

Posted by Glenn at 11:33 AM | Link
|A&R||Brick-And-Mortor Retail||Mobile Music|

• Album sales dropped 5% last week and were 16% lower than the same week last year. For the year, album sales are down 14%. It was a slow week for new releases as Talib Kweli debuted at #2 with sales of only 60,000. High School Musical dropped 40% from its debut tally but still retained #1 with 367,000 scans. Digital track sales dropped 2% last week and were 40% higher than the same week last year. For the year, sales of digital tracks are up 48%.

• Nokia announced its new mobile music store, Ovi. The service, to go live later this year, will sell WMA files over the air and downloaded to PCs. Ovi will have access to existing third-party services like social networks. (paidContent)

• Luaka Bop has found a new, post-V2 home at Red Eye Distribution. (Pitchfork)

• eMusic has renewed agreements with some of its most popular labels: Beggars Group (4AD, XL and Rough Trade), Matador Records, Concord Music Group and ATO Records. (Playlist)

• Sony BMG's "Dave Matthews & Tim Reynolds: Live at Radio City," out September 4th, will be its first music Blu-ray release with support for Dolby TrueHD. (Afterdawn)

• Market research company iSuppli sees a slowing in digital (both downloads and subscriptions) growth through 2008, but expects a "small resurgence" due to greater broadband penetration. (iSuppli)

• Satellite news: XM is moving its Nashville studio to the Sommet Center (home of the Nashville Predators, owned by the City of Nashville and just around the corner from the current studio at the Country Music Hall of Fame), and Sirius is adding a Grateful Dead channel. (The Tennessean and Variety, respectively)

Posted by Glenn at 10:36 AM | Link
|Distribution||Mobile Music||Research||Sirius||XM||eMusic|

As an amendment to my previous mention of the MTV-RealNetworks mobile music service joint venture, here's some information (via paidContent) on the deal. RealNetworks filed a Form 8-K that contains some specifics on the financial side of the venture. This looks like a marriage of necessity for RealNetworks (which needs to expand Rhapsody's mobile subscriber base and needs a big checkbook) and one of very few options for MTV (URGE has faltered, and mobile subscription has got to be a big strategy for the Viacom-owned company).

The joint venture is a limited liability company agreement. MTV will contribute a five-year, $230 million note, and RealNetworks will be obligated to buy $230 million in advertising on MTV cable channels -- which will include integrated marketing -- over five years. Real will control 51% and MTV will control 49%. Neither can transfer their interests for five years, and MTV gets a right of first refusal if Real decides to sell its interest. Expectations for 2007 revenue are between $2.5 and $3.5 million.

Here are some sections of the filing.

• "The assets contributed by Real generally consist of its Rhapsody service subscribers, a cash contribution, certain employees, contracts, revenue from existing Rhapsody subscribers, marketing materials, player hardware, rhapsody.com and related URLs, and distribution arrangements."
• "Real will also license certain assets to Rhapsody America, including Rhapsody content, the Rhapsody brands and related materials."
• MTVN will contribute cash, a five-year note for $230 million and other assets, including its existing URGE subscribers and marketing materials.
• "MTVN will also license certain assets to Rhapsody America, including URGE content, brands and related materials."
• "Real expects the formation of Rhapsody America to generate incremental revenue of approximately $0.5 million for the third quarter of 2007 and approximately $2 to $3 million for the remainder of 2007."

Posted by Glenn at 3:12 PM | Link
|Mobile Music||RealNetworks||URGE|

• RealNetworks, MTV and Verizon are teaming up for a mobile music service called Rhapsody America. MTV's URGE music service will join with RealNetworks' Rhapsody subscription service to create a music service that can be accessed via PC, mobile phone or (compatible) portable media device. Verizon's V CAST will be the service's mobile platform. (Press release)

• Wal-Mart has announced the launch of $0.94 MP3 downloads and $9.22 MP3 album downloads. The catalogs of EMI and Universal Music Group are available in the MP3 format at 256 kbps. The original, 128 kbps WMA tracks will also be available. The first things I noticed at the music download page were links to $3.88 MP3 albums (which are all EP's and singles), $5.88 MP3 albums (catalog titles like Bon Jovi's Slippery When Wet) and $7.88 MP3 albums (Norah Jones' Come Away With Me, for example). Unfortunately, Wal-Mart's updated digital store does not support Firefox. (Press release)

• Solange Knowles, sister of Beyonce, has signed a worldwide co-publishing deal with EMI Music Publishing. Knowles is currently promoting Baby Jamz, a hip hop-oriented toy line created by Planet Toys and Music World Entertainment, her father's company. (Press release)

• Another Madonna-to-LiveNation? article, but this one has some numbers and word of a rival. "One source estimated the value of the Live Nation offer to be $180 million, with the touring giant potentially licensing the recording rights for roughly $30 million. ... It is doubtful that WMG, the only label Madonna has ever been signed to, would give up the Material Girl without a fight. Sources say that the company has made a counter-offer to Madonna that also includes a touring component that could be helmed by rival promoter AEG Live." (Billboard.biz)

• Said the CFO of Emmis Comminications about satellite radio, "The people that utilize satellite radio often toggle between AM and FM and satellite radio, and it really hasn’t caused a measurable effect in our business yet. ... Satellite radio is a niche business focused on people willing to spend 13 dollars per month for the radio. Which for long-haul truckers or people who are advocates of a music format which may not reach a mass market – if you’re a passionate Blue Grass listener in New York City – it probably makes sense for you. But I think they’re still challenged. It’s a challenging business model to launch a billion-dollar asset in space and try to build up a mass-market audience quickly. And with 15 million subs it’s tough, which is why they’re trying to get the merger done. In large measure they’re trying to work with the government to solve a business model problem." (Radio Ink)

• Verve Music Group has named Mitchell Cohen as its VP of A&R. Cohen was previously SVP or A&R at Columbia Records. (Billboard.biz)

Posted by Glenn at 11:37 AM | Link
|Mobile Music||Publishing||Radio||RealNetworks||Rhapsody||URGE||Wal Mart|

• Universal Music Group will buy V2 Records from Morgan Stanley for $14 million (though reported price tags vary). The V2 roster includes Brit legend Paul Weller, the Stereophonics, Elbow and Bloc Party. The deal does not include V2 North America, which was sold to Sheridan Square for $15 million last year. The label merged with Artemis and had been demoted to a catalog-only label. (Reuters)

• The New York Post has an article on the collaboration between Epic Records and Koch Records. "Lacking a dedicated staff to market the songs specifically to hip-hop/ R&B radio stations and music video outlets like BET, Epic hired New York-based Koch, home to rappers including Jim Jones, UNK and DJ Khaled, to do it for them." (New York Post)

• Sanctuary Group chairman Robert Ayling, as well as James Wallace, Tina Sharp and John Preston, are no longer on the company's board of directors. (Billboard.biz)

• EMI has a deal with Arvato Mobile that will allow Arvato-powered carriers (T-Mobile, Swisscom, Mobilkom) to offer EMI videos to mobile phones or PCs. Content such as videotones, wallpapers and full-track downloads are also part of the deal. (Mobile Entertainment)

• A profile of new industry site The Daily Swarm. "We all saw that there was a ton of music-business information scattered around the Web, but there wasn't really one place that was bringing it all together." Side note: Coolfer will turn four years old this month. Thanks for reading. (Chicago Sun-Times)

• According to the BPI, UK music sales in France and Germany hit a four-year high last year. UK artists represented 23 of the top 100 albums in Germany. (BBC News)

• An interview with Guy Fletcher, head of music publisher MCS. "The internet is fast becoming a major platform for delivery of music in many different contexts. However, the advent of internet social networks, peer-to-peer file sharing, free downloading, etc. have created communication systems whose operators are generally unwilling to enter into licensing agreements with collection societies making it difficult, if not impossible for them to keep track of the online use of our copyrights." (The Telegraph)

• EMI's Blue Note Records is going to change its website to incorporate social networking and direct-to-consumer downloads. (The Register)

• Apple now offers iTunes widgets. (My iTunes, via Digital Music News)

Posted by Glenn at 9:12 AM | Link
|EMI||Mobile Music||Universal Music Group||iTunes|

• Universal Music Group has invested in Loud.com, a hip hop-slanted portal and networking site. (paidContent)

• GodTube.com is a new, Christian-oriented video site now in beta. (Billboard.biz)

• Music Row points out that country album sales are down 29.3% this year, a hit album by Taylor Swift notwithstanding. (After Carrie Underwood and Rascal Flatts had such a huge year, a drop was inevitable.) The end of the year, though, will have some big names: Kenny Chesney on September 11, Rascal Flatts on September 25, Brooks & Dunn on October 2 and Carrie Underwood on October 23, plus unconfirmed rumors of a Keith Urban greatest hits package. (Music Row)

• At the Marketing to Men 18-34 conference in New York, the big topic was branded entertainment, i.e., music with a ton of product placement. (Billboard.biz)

• Judging from the information in Rob Mitchum's article on concert first aid stations, indie rock shows are far safer than metal shows. Only one Pitchfork Festival attendee required transport to a hospital, while a mid-July Ozzfest concert saw "two people with stab wounds, numerous people with dislocated shoulders, facial trauma, sutured up a lot of faces, that kind of stuff, especially from mosh pits." Because of the age of attendees, classical music concerts actually have the highest mortality rate. The winner for highest rate of medical tent visits goes to gospel/Christian events. (Chicago Tribune)

• From 2003 to 2006, the percent of U.S. camera phone users who emailed/transmitted photos wireless dropped 22 points. Is there a parallel with over-the-air music? "People will download music OTA while it is a novelty then they will sideload all their MP3s to their music phone (sideloading is primary way to get music on a music phone). Just like people expect a camera on their phone they will expect an MP3 player, but the carrier will not see any revenue from the use of this feature." (Ad-Supported Music Central)

• Univision is facing another bribery lawsuit, this one brought by Los Angeles-based Platino Records. A previous lawsuit alleging the bribing of radio stations was brought by a former VP for Univision's Fonovisa Records. The company's equity partners are interested in selling some non-core assets, such as the music division, to help pay off debt. (Los Angeles Times)

• Long Gone John has put his label, Sympathy for the Record Industry, up for sale. John Reis (Swami Records) has put in a bid of 30 very expensive llamas. (LA Weekly)

• Localism works in music retail. In Fort Lauderdale, Radio-Active Records is within five miles of Borders, Target, Circuit City, Barnes & Noble and Best Buy, and yet it is growing. "Our biggest strategy is community involvement. It's why Virgin [Megastore] couldn't survive down here: They don't pay attention to what music locals are interested in. I go to the clubs, I see what people are dancing to, and I order that stuff in the store." (Broward Palm Beach)

Posted by Glenn at 8:06 AM | Link
|Brick-And-Mortor Retail||Marketing||Mobile Music||Universal Music Group|

• Mobile carrier Amp'd, which counts MTV and Universal Music Group as its investors, has shut down its service and owes over $100 million to creditors. The company had filed for bankruptcy last month. (Variety)

• Sanctuary has sold its 49% share in the Rough Trade label to the Beggars Group for £800,000 (US $1,651,507). (The Guardian)

• XM and Sirius promised that in the event the two satellite companies merge, the companies will offer a variety of subscription packages. The lowest-priced package would get 50 channels and cost $6.99 a month. Said an analyst, "If the Department of Justice approves the merger, it will be difficult for the FCC to say no." (Reuters)

• Dallas-based hip hop label Clout Records has inked a distribution deal with EMI. Cloud will release Lil Prince's Young and the Wreckless on September 25. (Hip Hop Elements)

• Kansas City-based rock band Vedera has signed with Epic Records. (MySpace, via Kings of A&R)

• Oklahoma state representative Randy McDaniel has proposed a study to find out what incentives Nashville and other cities offer musicians. McDaniel sits on a committee that deals with Oklahoma's tourism, arts and culture. (The Journal Record)

• Ted Cohen, a former EMI exec and now part of TAG Strategic consulting, is on the board of advisers at Txttunes. The company just announced the launch of its text-based distribution and social networking service. Fans can use their cell phones to purchase and download MP3s. Artists can use Txttunes to send text messages to fans. (Press release)

• A profile of Ventura, CA-based Salzer's, where vinyl sales are up 20% this year. (Ventura County Star)

• AllHipHop.com got a makeover and has some new features. The site has partnered with Amazon.com to create an e-store that uses Amazon.com's technology and content. AllHipHop is working with iTunes on a Black Music Month promotion. The site will give away 250,000 promotional codes that can be redeemed for a free mix tape at iTunes. (Press release)

Posted by Glenn at 8:03 AM | Link
|A&R||Brick-And-Mortor Retail||Mobile Music||Sirius||XM|

• According to figures just released by the IFPI, the global recorded music market shrank by 5% in 2006. Digital accounted for 11% of shipments (odd that the word is used for a product that really isn't shipped) versus 2% in 2004 (ringtones are not included). Labels' income from performance rights collections rose 8% to $728 million. (Billboard.biz)

• Feisty Russian download store AllofMP3.com has been shut down. The site was singled out by U.S. trade representatives as Russia sought entry into the World Trade Organization. The same company that operated AllofMP3.com has already launched a similar site called mp3Sparks.com. (Times Online, via paidContent)

• The Kelly Clarkson saga continues. The singer has left The Firm and joined Starstruck Entertainment for management. (Bilboard.biz)

• T-Mobile has launched a mobile service in the U.K. that offers over 500,000 tracks at £1 each. The dual download service is called Mobile Jukebox. Each purchase results in an AAC file for the mobile device and a WMA file for the PC. (Mobile Choice U.K.)

• It probably won't have any effect on physical music, but the majors old Minimum Advertised Pricing (M.A.P.) came to mind when I read about the Supreme Court's decision that allows for minimum pricing by manufacturers and retailers. In a case that put Leegin Creative Leather against Kay's Kloset, Leegin defended its minimum pricing system by arguing in part that smaller retailers would be able to compete against discounters. Sounds just like majors labels' argument for their M.A.P. that denied cooperative advertising funds to retailers that advertised below a certain price. After the F.T.C. forced labels to drop M.A.P., mass merchants began their predatory pricing practices that has, along with digital downloading and the accompanying shift in listening habits, has helped put thousands of music retailers out of business. (AP)

• The final 700 or so employees of U.K. music chain Fopp were dismissed today. The company owes £10 million to suppliers who are not interested in extending new terms. Good call. Maybe they learned something from keeping Tower on life support as it failed to adequately update itself for a changed market. (Times Online)

• Napster issued a statement to investors about the possibility that the iPhone, with its lack of compatibility with Napster software, could harm its business. Pretty standard disclosure for a public company, in my opinion. And besides, Napster was always going to have to hitch its wagon to another device. (Information Week, via Engadget)

• At the Huffington Post, music writer Paul Bonanos on Beggars Banquet for its download scheme for vinyl copies of The National's Boxer album. Each vinyl LP comes with a code that allows for up to three album downloads (one for yourself, two for your friends). While "home taping" is hurting the recorded music business, wrote Bonanos, those extra copies benefit other revenue streams. "We're seeing CDs turn into promotional tools for the live tours," Festival Network head Chris Shields told Matt Miller in an article at The Deal. (Huffington Post)

• European antitrust regulators are stepping up their investigation into high-definition DVDs and possible anticompetitive practices in the format war. (Wall Street Journal)

Posted by Glenn at 11:11 AM | Link
|Brick-And-Mortor Retail||Mobile Music||Napster||Research|

• After a three-month delay, the European Union is going to restart its investigation into the Sony BMG merger. That will put date of decision at the second week in October. Regardless of the outcome, a thorough investigation is expected to offer signals that other companies will use for their mergers and acquisitions. (Times Online)

• The Harry Fox Agency and Ingrooves have inked a deal that will see HFA using INgrooves' proprietary software platform for licensing and payment processing. (Billboard.biz)

• BurnLounge has no plans to give refunds to its paid members but will waive all renewal and monthly fees for existing members through the end of 2007. (Hypebot)

• British website Slice the Pie is the latest to provide a fan-based financing tool for unsigned bands. Bands move through stages called The Scout Room, Showcase and Financing, the latter being the stage at which a band that has secured 1,000 £15 offers will release an album. (Get Reading)

• A former Columbia Nashville SVP of promotion has launched Nine North Records, a country label that aspires to break new artists through "innovative independent partnerships." We'll be aligned with several highly experienced professionals who can bring sales, marketing, public relations, digital and artist development skills to the mix on an a la carte basis. This business format will allow us to work with acts from the ground up and with less of a safety net." (MusicRow.com)

• Fortune's Dennis Hau on the economics behind Burgendy Records' contracts with older artists. "Burgundy usually limits itself to one-album contracts with its artists, sometimes with options to release more music. And because it has a full-time staff of only about two dozen employees, it expects to put out no more than two or three albums a year." It takes 24 people to sell about 150,000 units per year? Amazing. (Fortune)

• The Guardian has a very smart take on the move, by bands like Ash, toward releasing just singles instead of albums. "...the looming death of what is still known as the album should cause no little alarm. Doesn't the obligation to attempt a grand artistic statement serve as a reliable litmus test? ... Songs may powerfully denote passing moments, but you surely need more to truly soundtrack your time." (The Guardian)

• Groove Mobile wants to expands its direct-to-consumer trial to more labels and carriers, and has a deal with Vodaphone UK for lower data charges. "Services like this need to be cross-carrier - there's no point in promoting track downloads at a concert, for example, if only a quarter of the people there can take part." (Mobile Entertainment)

• While I try to appreciate both sides of every argument, I can't agree with Ann Power's take on the Clive Davis/Kelly Clarkson dust-up. What separates Powers' belief in artistic development and my belief in a balance between art and commerce is the fact that Clarkson won a singing contest, not a singing-and-songwriting contest. (Los Angeles Times)

• Jupiter Research's Joe Laszlo has a report on over-the-air music purchasing and says that there are obstacles in infrastructure, business models and carriers' ability to take advantage of impulse purchases (which goes for pretty much every digital music store or service). "Approximately 20 percent of online consumers are impulse music purchasers. This segment, already reasonably engaged in mobile music activities, represents the best target for becoming regular users of OTA music stores or services. Tying into key purchase motivators, such as radio play and friends' recommendations, can help drive OTA impulse music purchases more broadly." (David Card's Jupiter Blog)

• Universal Music Group's catalog division has a website, ilovethatsong.com, that currently has a Flash-based puzzle game in which you complete puzzles of UMG catalog titles. Each album's puzzle pages has a link to purchase at iTunes for $7.99 -- or less if you already own one of the album's songs. (Unscramble the Covers)

Posted by Glenn at 6:57 AM | Link
|Mobile Music||Online Stores/Services||Research||Sony BMG|

Sony BMG's Australia GM of sales and digital Gavin Parry recently talked about the future of mobile at the Mobile Content World Australasia 2007 (read post at paidContent). He also talked about the complexity involved in digital and mobile music and gave Justin Timberlake as an example. Sony BMG Australia got $45 million in revenue from Timberlake through 71 different pieces of content. The CD represented $33 million of the revenue. "We worked very very hard to get that $12 million from digital content,” he said.

Posted by Glenn at 4:48 PM | Link
|Mobile Music|

Mobile-based subscription service MusicStation got a big endorsement from Universal Music Group SVP of digital, Rob Wells. "It's hard to imagine a more compelling music experience on mobile than MusicStation. It works on almost any phone, giving consumers the freedom to choose whatever device they want, [and] it allows downloads wherever those consumers are."

While most analysts and journalists have been attracted to the timing of the MusicStation rollout -- ostensibly to steal attention from the upcoming iPhone -- I have been taken by how the service is priced. Rather than say it's 11.96 euros ($16) per month, the price being reported is 2.99 euros ($4) per week. (Almost unbelievably, the press is going along with MusicStation's press releases and reporting the price exaclty as the company wants it to be reported. I almost get the feeling analysts who are positive about MusicStation are thinking of the weekly price and not the less attractive -- but ultimately equivalent -- monthly cost.) The weekly cost sounds like a better, more manageable price and will probably help the product roll out.

Posted by Glenn at 3:26 PM | Link
|Mobile Music|

• There's money in them hills: The just-completed Bonnaroo music festival, put on by Superfly Productions, sold out its 80,000 tickets and raised about $17 million in ticket sales -- up from $14.7 million last year. (Billboard.biz)

• Contrary to popular opinion, digital music has been no better for the environment than CDs, wrote Billboard's Anthony Bruno. Discarded MP3 players leak heavy metals and chemicals into landfills, and consumers are buying more blank CDRs to burn the music they have acquired digitally. The Consumer Electronics Association has launched www.MyGreenElectronics.com to help consumers responsibly use their electronic devices. (Billboard)

• Verizon now offers full track, over-the-air downloads from Wind-Up Records artists such as Creed, Scott Stapp, Evanescence and Finger Eleven. An over-the-air track costs $1.99 and comes with one copy for the PC and one for the mobile handset. (Press release, via Digital Music News)

• The Canadian Private Copying Collective (CPCC) announced it has distributed more than $100 million from private copying levies in just four years. In Canada, the CPCC collects levies on blank media, such as CDRs and cassettes, and gives the money to rightsholders. (Press release)

• Inside the guts of a Zune Marketplace desktop software file are hints that Microsot's Zune may be preparing a content partnership with MTV, VH1 and CMT. (Engadget)

• You know there's a premium on news for anything relating to both digital music and the Beatles when news of a Ringo Starr digital reissue makes waves across the Internet. (Billboard.com)

• Music attorney Chris Castle dissects a Washington Post op-ed by the Electronic Frontier Foundation's Fred von Lohman. (Digital Music News)

Posted by Glenn at 7:31 AM | Link
|Live Music||Mobile Music||Zune|

• Classical music distributor Naxos of America has introduced NaxosDirect, a direct-to-consumer online "boutique" that offers CDs, DVDs and audiobooks from Naxos and distributed labels. It offers a blog for daily reading. The site is a throwback...it streams available titles but does not offer digital downloads. (Press release)

• All four majors and some indies have signed deals with Omnifone that will allow mobile carriers to offer its inexpensive MusicStation subscription service. The first carrier to carry the service will be Norwegian operator Telenor. In coming months, another 30 mobile operators in other countries will launch the service. The term "iPod killer" has not been used much lately -- too many products, too little success -- but it's being used for MusicStation. (Tech Digest)

• All those disparaging "pyramid scheme" names that were thrown at BurnLounge over the years look to be true -- at least in the eyes of the FTC. The music download site is accused of operating a pyramid scheme, making deceptive earnings claims and failing to inform customers that most will lose money rather than make money. (ITWorld)

• Sony BMG will close its Sony Music Studios in the Hell's Kitchen area of Manhattan. Some employees will be able to transfer to a different part of the company. (amNY)

• Prince is partnering with Columbia Records for the release of his next album, Planet Earth. (Hollywood Reporter)

• Norfolk record store Relative Theory will close at the end of the month. (Daily Press)

• There have been scores of articles about today's music being overcompressed and too loud. Yesterday I ran across a YouTube clip that audibly and visually explains what those articles are talking about. (YouTube, via Presentation Zen)

Posted by Glenn at 7:44 AM | Link
|Brick-And-Mortor Retail||Mobile Music||Online Stores/Services||Sony BMG|

• Over 2,500 Sony BMG videos have been added to MobiTV's service. The first initiative between the two companies is a dedicated Avril Lavigne channel. (Press release)

• Cherry Lane Music Publishing has joined the class action lawsuit against YouTube that was brought by Football Assn. Premier League and Bourne Co. last month. (Billboard.biz)

• Hot Topic, which a few months ago talked about changes in its customers' musical preferences, is getting rid of its goth look. (CNNMoney.com , via Kings of A&R)

• Here's a podcast (download MP3 here, go to post to stream the file) of an interview with eMusic's David Pakman. Pakman talks about how he thinks the other majors will follows EMI's lead, and how EMI's prices are too high. He hints that eMusic will have portions of major label back catalogs in the future, but they "haven't announced anything." (Inside Digital Media)

Posted by Glenn at 8:20 AM | Link
|Brick-And-Mortor Retail||Mobile Music||Publishing||Sony BMG|

• More on the CISAC Copyright Summit in Brussels: British Telecom CEO Ben Verwaayen was brutally frank with the audience. "Your industry has not changed for 20 years, maybe 50 years," he said in his keynote address. "You have to rethink how you work in the digital age. Are you just a rights administrator that sends me a bill, or are you something more?" Sounds like the Lawrence Lessig panel was pretty lively, too. (Hollywood Reporter)

• Ethan Smith covers Lala.com's interoperable, free-of-charge subscription service that launched today. (Go here to download player application.) "It's like a subscription music service, but without the monthly subscription fee. Lala is betting that in return for getting all that free access to music at home, listeners will pay to buy the songs they want to take with them on iPods and other music players. The prices will range from $6.50 to $13.50 for an album." Lots of interesting details in the article. Big difference here is that the subscription service works with the iPod. Give it a read. (Wall Street Journal)

• Melodio plans a mobile service that allows users to stream songs from their iTunes library. (Reuters)

• eMusic will offer Paul McCartney's new Hear Music album, Memory Almost Full. This means two things: Fans can get the album in MP3 format without Apple-style information embedded in the file, and the low price should help pad McCartney's SoundScan numbers. (Bit Player)

• Universal Music Publishing acquired the catalog of songwriter Michael Masser, who wrote the Whitney Houston hits "Saving All My Love For You," "The Greatest Love of All" and "Didn't We Almost Have It All." (Press release)

• Miami's Jackie Gleason Theatre inked a ten-year deal with Live Nation and will bear the Fillmore Theater brand name. (Billboard.biz)

Posted by Glenn at 8:25 AM | Link
|Mobile Music||Online Stores/Services||Touring|

The Register has an article on a panel at MusicAlly's digital music convention that paints a gloomy picture for mobile music.

"The ringtone business is also showing signs of cooling off - with UMG saying revenues were down 20 per cent year on year. However, ringback tones - which is the song you hear when the call recipient is away or busy - have been a bonanza in Asia, but have yet to catch on in Europe - that's potentially a $2bn a year business waiting to happen (ringtone revenues dwarf the amounts raised by online download stores such as Apple and Napster: they grossed $6.6bn last year."

A "cold wave of realism is blowing through the operators," says the article. One operator is allegedly experiencing flat sales and plans to increase prices. Another reported that saturated promotion actually hurt one artist's sales -- thus big money promotions are a thing of the past.

MusicStation's Rob Lewis, though, see great potential in mobile music. MusicStation, which will roll out with 30 European carriers, will offer "celestial music" for £1.99 a month. "Simplicity is what can beat an iPod," said Lewis.

Extra credit reading:

• Coolfer on MusicStation
• Forrester's Mark Mulligan thinks record execs may not see a bright future in mobile
• 2006 mobile download statistics for Japan

Posted by Glenn at 6:39 PM | Link
|Mobile Music|

• Warner Music has sued social networking site imeem for copyright infringement. According to the lawsuit, "Imeem itself directly engages in much of the infringing conduct by duplicating, adapting, distributing and performing plaintiff's works through Imeem's own servers." Indeed. Take a look at the top songs at imeem and count the number that have the proper license for on-demand streaming (somewhere around zero I would imagine). (Wall Street Journal)

• The UK Parliament Committee has called for an extension on copyrights on sound recordings from 70 years from the existing 50 years. (BBC News)

• The Los Angeles Times' Jon Healey was a good article on the sometimes perplexing variation of CD price points. A theme of the article echoes some of my recent arguments about differences in price elasticities, that "there are two price thresholds: one for fans and one for the merely curious." (Los Angeles Times)

• Motorola has inked a partnership with Napster to provide subscription services to the handset manufacturer. The Motorola ROKR and Z6m will be the first phones able to download and play tracks from the $14.95-per-month Napster To Go service. Motorola buyers will be offered the first month at no charge. (PC Pro)

• Great marketing: Blue Note will sponsor an air-conditioned jazz tent at this summer's Bonnaroo Music Festival. Blue Note artists such as Ravi Coltrane and Stefon Harris will perform. (AP)

Posted by Glenn at 11:22 AM | Link
|Legal||Marketing||Mobile Music||Music 2.0||Napster||Warner Music Group|

• Clear Channel agreed to an increased offer of $39 a share -- $19.5 billion in total -- from private equity firms Thomas H. Lee and Bain Capital. Shares are currently trading at $36. Some investors may hold out for a higher offer, but Lee and Bain called $39 their "best and final" offer. (BBC News)

• EMI is in talks with Singapore-based Soundbuzz to offer DRM-free tracks in "multiple markets" in Southeast Asia. (Billboard.biz)

• Amazon.com launched a new music section, called "Go Indie," dedicated to indie music. It has a "hand-picked selection" of nearly 700 titles, 150 of which sell for $9.99. (Press release)

• Standard Life Investments, which owns about 1% of EMI's stock, believes a merger with another media company would be the company's best option. "And it's hard to argue against the logic of large players in the industry coming together and sharing the benefits of cost saving and all sorts of rationalisation that would come with that," said an investment analyst with the company. (Forbes.com)

• Sprint Nextel will open a virtual concert venue in the Second Life virtual reality site that will cater to fans of Latin music. The Sprint Center will stream pre-recorded performances from the Telemundo series "Concierto Clandestino." (Billboard.biz)

Posted by Glenn at 12:02 PM | Link
|EMI||Mobile Music||Radio|

You know the music industry is really aching to develop new revenue streams when EMI's Eric Nicoli gently talks down at mobile operators he feels are stunting the market's growth. Said Nicoli at the CTIA Wireless trade show in Orlando,

"We will not reach our goals if we carry on as we have been doing. Not to diminish what we have achieved so far, but there are important challenges to address if we want to take this business to the next level. And that means we must put the customer at the forefront."

By "we" he means "we can be only as successful as hardware manufacturers and mobile operators allow us to be," which is partially true. And...

"Apple makes stuff that people love to own. They love the simplicity and user-friendliness of the iPod and iTunes. Apple doesn't employ any sorcery or dark magic to achieve this. They listen to what consumers want. And that shouldn't be Apple's unique privilege."

More from paidContent:

"He suggests a three-part test for every decision: value for money, good product offering, ease of use. Nicoli said he feared 'many of us' would fail the test if applied to what is being offered now: 'I'm merely asserting that we all have more room for improvement than we can comfortably admit in public.'"

Posted by Glenn at 3:32 PM | Link
|EMI||Mobile Music|

• EMI and Bertelsmann settled their lawsuit related to the latter's support (loans) for the Napster P2P service. Specifics were not disclosed. Universal Music Group settled for $60 million in September 2006. (FT.com)

• Napster inked a deal to provide its Napster To Go subscription service free of charge to AT&T wireless and high-speed Internet customers. Customers will be able to upload tracks to portable music players and compatible mobile phones. The offer will be free with a two-year wireless agreement with purchase of select phones. Home users will get the service if they purchase ATT&T Yahoo! or FastAccess DSL Ultra Internet service. (Press release)

• Sprint is dropping prices for over-the-air downloads to $0.99 for customers that subscribe to any Sprint Data Vision data plan. (Press release)

• Nettwerk and video game company Electronic Arts announced a joint venture label, Artwerk, to develop new and established for both physical and digital distribution. (Digital Media Wire)

• Waylon Jennings' "Theme From Dukes of Hazzard (Good Ol' Boys)" has become the first country music ringtone to reach platinum, or sales of one million. (Press release)

• Doug Morris, CEO of Universal Music Group, was named to CBS Corp's board of directors. (Broadcast Newsroom)

• Read DiMA's reaction to the U.S. Register's call for modernization of Section 115 of the Copyright Act. "A streamlined blanket music licensing system will guarantee digital music services access to more music with lower transaction costs, which in turn will encourage innovation, keep legal music prices low, grow our industry and increase royalties to all creators." (Press release)

Posted by Glenn at 8:15 AM | Link
|EMI||Mobile Music||Napster||Ringtones|

• Entertainment One Income Fund sold its investments -- which include Koch Entertainment Distribution -- to Marwyn Investment Management for approximately US $161 million. (Video Business)

• More Koch: The company announced the formation of Koch Records Jazz/Adult Division. Chuck Mitchell, former head of Verve Records, will head the new operation. (Jazz News)

• Warner Music Group announced a partnership with Norway-based mobile operator Telenor that originally covers nine of Telenor's mobile operators. (Press release)

• Nic Feldes has a good recap of EMI's current situation. (The Independent)

• Read the text of Edgar Bronfman's keynote at the 3GSM Conference in Barcelona. Here's a sample of the frank commentary: "Actually, it’s amazing that we’ve generated as much revenue as we have through mobile music, given how cumbersome the consumer experience can be." (Download PDF)

• Actor Heath Ledger has partnered with musician Ben Harper to start the new Masses Music Co record label. First singing: Australian Grace Woodruffe. (StarPulse)

Posted by Glenn at 7:10 AM | Link
|A&R||EMI||Indies||Mobile Music||Warner Music Group|

• EMI warns of lower profits for the fiscal year -- a whopping 15% decline year over year -- and points to weakening sales in North America. (Press release)

• David Goldberg, one of the leading critics of DRM, is one of two execs leaving Yahoo! Music for "personal reasons." He said he will return to his "entrepreneurial roots." (Billboard.biz, more at paidContent)

• At the 3GSM conference, music executives criticize mobile operators for poor user experiences. (New Media Age)

• Trans World announces Vcommerce Enterprise, consolidates the majority of its stores under the name f.y.e." (Press release)

• LiveNation has closed the Starwood Amphitheater in Nashville and canceled its 2007 season. (WKRN.com)

• Venture capital for musical acts. (Billboard.biz)

• Canada is making a second attempt to tax MP3 players. (VNUNet)

Posted by Glenn at 7:53 AM | Link
|Brick-And-Mortor Retail||EMI||Live Music||Mobile Music||Online Stores/Services|

The Times has an article on a mobile music software by London-based Omnifone that will power a music subscription service. Report says the major labels are on board.

"Vodafone and the 3 Group are among more than 20 mobile network operators said to be working with Omnifone. The project is also understood to have the backing of Universal Music and other leading music companies. The first roll-outs of the service are expected to take place in the next few months. Apple’s unveiling of its iPhone last month has increased the pressure on the mobile industry to accelerate the development of the mobile-music market."

The software, called MusicStation, is said to offer an iPod-like experience -- I'd agree after looking at the demos -- and the service will cost less than £10 (US $19.50) per month. Billboard.biz also has an article on the service. It reported on the DRM underneath the music.

"...MusicStation is supported by a repertoire of 1 million-plus full tracks protected by digital-rights-management (DRM) software from the four major labels, plus local independents and content aggregators. The device uses the eAAC+ (enhanced advanced audio coding) DRM system."

The service also offers personalized music news and social networking features. Along with the user interface, those are the features that make this service look really promising. The company is working with carriers throughout Europe -- but not in the U.S. yet.

Posted by Glenn at 4:45 PM | Link
|Mobile Music|

• Data from Telephia suggests growth of ringtone sales may be flattening -- at least temporarily. Third quarter ringtone sales ammounted to $198 million, only $5 million more than the second quarter. (Read post at Digital Music News)

• Jupiter Research's Mark Mulligan says HMV, which struggled in the fourth quarter, needs to be more a media retailer than a music retailer. The retailer has dedicated more shelf space to non-music items, launched its own digital download site and, it is rumored, will launch in-store download kiosks. (Read article at BusinessWeek.com)

• URGE makes a move to differentiate itself by signing exclusive deals with dance labels Ed Banger and Planet E. The MTV online music service will make available unreleased tracks by the label. In addition, URGE is sponsoring a DJ set by Planet E founder Carl Craig. (Read artcicle at Billboard.biz)

Posted by Glenn at 2:22 PM | Link
|Brick-And-Mortor Retail||Mobile Music||Online Stores/Services||URGE|

CES, the annual electronics convention in Las Vegas, is always a time for companies to reveal new products and announce new partnerships. For the music industry, yesterday's announcements showed that no one company can go it alone. As services and hardware become more integrated, we're going to see palpable shifts in how consumers -- all consumers, not the early adopters who dive head-first into any new gadget -- enjoy music. Here are a few of the key announcements thus far.

• Apple and Cingular. The Wall Street Journal reported Apple is launching a mobile phone service and a phone. Cingular will be the network provider.
• Microsoft and Clear Channel. Clear Channel will supply the HD radio content for Microsoft's MSN Direct service.
• Microsoft and Motorola. Motorola's new mobile phone will use Microsoft's Windows Media DRM to allow users to play music from such services as Rhapsody, Napster, Yahoo! Music and URGE.
• Morotola and Warner Music. The global agreement puts Warner Music content exclusively in Motorola mobile services.
• Rhapsody and TiVo. Later this year, the Rhapsody music service will be integrated with TiVo so three million songs will be accessible on consumers' televisions.
• Rhapsody and iriver. iriver announced two new Rhapsody-enhanced portable music players; one of the devices (pictured) will download music over the air from the Rhapsody music service. Both devices will be available by July 2006.
• Rhapsody and Logitech. Next week, users of Logitech's Squeezebox and Transporter players will be able to access Rhapsody without using a PC. The service will be priced at $9.99 per month.

Posted by Glenn at 9:40 AM | Link
|Apple||Digital Music||Mobile Music||Portable Music Players||RealNetworks||Rhapsody|

• Radio giant Entercom Communications, which owns 105 radio stations around the country, will pay $4.5 million to end Eliot Spizter's payola probe. The company will pay $3.5 million to fund music education and appreciation programs, and pay $750,000 to the state of New York. Among the reforms Entercom agreed to are refusal of payments and other inducements from record labels in exchange for radio play, banning payments from independent promoters, and the hiring of an internal compliance officer to monitor promotion practices. (Read AP article and Spitzer press release)

• Hot 97 has partnered with Amp'D Mobile. The NYC station will be streamed exclusively to Amp'D Mobile customers, while Hot 97 listeners can purchased Amp'D Mobile phones at www.hot97.com. (Read article at Radio Ink)

• An interview with Mel Karmazin, CEO of Sirius Satellite Radio. On the possibility of a merger with XM: "Who knows? Obviously, consolidation has, in my opinion, been successful in the media business. ... I certainly think there would be advantages if the two companies merge, with cost-savings and the like, but our business plan doesn't contemplate that. There's no reason to believe that XM has any interest in selling themselves." (Read article at The Hollywood Reporter)

• Beyonce will record a Spanish version of "Beautfil Liar" with Shakira. The track will be included on a new edition of B'Day along with three other Spanish-language tracks. As Shakira knows, tossing a new song on an old album and then calling it a new version of the same album is a really good way to improve sales. (Watch interview at Univision, via Billboard.biz)

• Embattled Russian music site AllOfMP3.com issued a brief response to a lawsuit brought by major music companies. The company called the lawsuits "imprudent" and bruskly noted they were filed in New York while the company "operates legally" in Russia. Music groups allege massive copyright infringement. The Russian government has pledged to address U.S. complaints against the download site, and Visa and Mastercard now refuse transactions at the site. (Read press release)

Posted by Glenn at 8:11 AM | Link
|Mobile Music||Payola||Satellite Radio||Sirius|

• The Financial Times reports EMI has hired a third investment bank to advise on a potential deal with Permira. It is a sign a deal could be finalized soon, maybe this week. (Read Reuters article)

• Forrester takes the iPod down a notch. Analyst Josh Bernoff: "The iPod is not necessarily a machine for generating revenue for the music industry." He has found that iTunes' rapid expansion has slowed (as has digital sales in general), which echoes worries by music executives around the world. (Read article at Globe and Mail)

• The holiday layoffs continue. House of Blues layed off 79 people post-acquisition by Live Nation. (Read article at Billboard.biz)

• Hits reports on more structural changes at Sony: Columbia Records' promotions staff is now organized by "national specialist cells by format." (Read post at Hits Rumor Mill)

• An IDC report on mobile music services are not connecting with consumers. One of the main reason is prices, which are seen as too high. While SMS (short message service) is popular, only about 20% of respondents have purchased a ringtone and only 10% have purchased either a graphic, wallpaper or game. (Read post at Playlist)

• J. Valentine, known for a sound described as "R&Bay" (rhythm and bay) has signed with J Records. His album will be out in early 2007. Production was handled by Scott Storch, Cool & Dre, The Underdogs, Dre & Vidal, Polow Da Don, Needles and The CityBoyZ. Among the guest artists are E-40, Keak da Sneak,Bailey and Keri Lynn. (Read press release,, via Kings of A&R)

• Sony Music Studios unveiled Sony Music Studio Internet Mastering, an Internet-based mastering service that will professionally master four songs per project at a cost that starts at $99 per track. (Read article at Mixonline.com)

• A few bits from yesterday's FCC media ownership hearing in Nashville. The Hollywood Reporter has a good overview. Radio Ink has excerpts from introductory remarks from Chairman Kevin Martin and Commissioners Michael Copps and Jonathan Adelstein. The FCC website has the full texts of their remarks (read PDFs of Martin, Copps and Adelstein).

Posted by Glenn at 7:16 AM | Link
|Apple||EMI||Live Music||Mobile Music||Sony BMG||iTunes|

• Warer Music Group's Edgar Bronfman on mobile music: "I do think that frankly, at least as important as finding the right retail price point for consumers, is for the telephone companies and handset manufacturers to create a seamless, easy user interface. Until that happens, frankly I don't think we can tap the dramatic potential that exists ... I think that's coming, and coming rapidly, but it can never be too soon." Such is the record label's lament. It can license music but somebody else has to sell the music. (Read Reuters article)

• EMI inked a deal with BT Group that will make its videos available on the upcoming BT Vision, a digital TV service that carries no mandatory subscription fees are charges customers for what they watch. BT Vision will carry digital radio with branded channels by Mojo, Kerrang!, Q, Virgin Radio and others. (Read article at Reuters UK)

• The Chicago Symphony Orchestra announced last week that it is launching its own record label. CSO Sound's first offering will be a recording of Mahler’s Symphony No. 3 and will be available as a CD and digital download. The CSO plans about two CDs per year and an additional three to four digital-only releases. (Read article at Playbill)

• The HD Radio Alliance will increase to $250 million its advertising commitment to broadcasters. Campaigns support retail, receiver and automotive partners. Over 1,000 U.S. stations currently broadcast in HD. (Read article at Radio Ink)

• Brooklyn metal screamer Purple Pam signed with Universal. Her song "Take Me Away" is on the soundtrack to the Universal movie "Disorder." (Read her MySpace blog post about the signing, via a thread at the Velvet Rope)

• Scott Weiland (Stone Temple Pilots, Velvet Revolver) has started a record label, Softdrive Records. It will be distribute by RED Distribution. (Read Billboard article)

Posted by Glenn at 7:58 AM | Link
|Indies||Mobile Music||Warner Music Group|

• Warner/Chappell Music announced a sub-publishing deal with Disney Music Publishing. That puts the rights to over 10,000 Disney songs in the hands of Warner Music Group's publishing arm. (Read press release)

• UBC Media will launch a new service in the UK starting in May that will allow radio listeners to instantly download a playing song to a mobile phone or digital radio, as well as to their computer. Six radio groups and three major label groups -- WMG, Universal Music Group and EMI -- are on board; Virgin Mobile will be the first phone company to offer the service. UBC's chief executive calls it "radio's killer application," but there's a problem with the method of payment. Consumers will have to use a pre-paid account to buy the songs. Nothing says impulse purchase less than a pre-paid account. (Read article at The Scotsman)

• Fortune writer Devin Leonard asks, Can Web 2.0 can make music stars and rescue record labels? OK, who really thinks Second Life is a good place to market music? I'm skeptical. Selling music to virtual reality addicts who may or may not be avid music consumers strikes me as a potential waste of money. They're not the type of consumers who break a band, so if labels do go with Second Life it should be for established names. Anyway, the press labels will get from such different marketing strategies could be more productive than the actual marketing -- but that press will dry up eventually. Will Second Life break a band? Probably not. Will Second Life assist in breaking a band? Probably...but just assist. As with bands that supposedly rose to prominance through blogs, there's more going on than meets the media eye. (Read article at CNN Money)

• Speaking of breaking a band, here's another article on OK Go and YouTube. This one gets it right: "I don't think this works without all the TV appearances and endless touring these guys have done," said Capitol Records' Ted Mico. "It doesn't work in its own hermetically sealed box." (Read article at USA Today)

• Warner Music Group dropped to 25.80, is trading at a three and a half week low and has dropped below its 50-day moving average. On the positive side, WMG was trading at 17.80 a year ago. Encouraging results and EMI-related speculation pushed it higher, now some of that merger optimism is being squeezed out. WMG reports earnings this Friday. (Read article at Trading Markets, view at Google Finance)

• Country music makes its comeback in Los Angeles. (Read article at Los Angeles Times)

Posted by Glenn at 9:01 AM | Link
|Mobile Music||Publishing||Radio||Web 2.0|

• Sony BMG fired the president of its classical music division, Gilbert Hetherwick, and six other staffers at Sony BMG Masterworks. The Masterworks label is being folded into Sony BMG Music Entertainment Commercial Music Group to make it (quoting from a statement) "eaner, more responsive and more effective in adapting to the new realities of reaching the classical music consumer." (Read article at Playbill)

• Rhino Records, the venerable catalog label owned by Warner Music Group, has a deal with Verizon Wireless that will allow V CAST customers to purchase ring tones and ringback tones of classic songs from the Rhino Catalog. The songs will be released in a series called "Songs You Know." Each volume is a bundle of tones and songs (that will be downloaded to the PC) and have a price tag of $9.99. Artists on the first volume include Otis Redding, Mr. Big, Devo and Skid Row. Volume Two includes songs by Dio, Brandy, The Ramones and En Vogue. I can't speak for all consumers, but I think these are pretty terrible mixes of artists and genres. This would be fine unbundled, but bundling Dio and Brandy doesn't make sense. (Read press release)

• Warner Music International has partnered with social network elHood.com. The deal will put WMI content in the music-focused, Latin-targeted social networking site. (Read article at elHood.com)

• A country Coachella? Goldenvoice, who puts on the popular Coachella Valley and Arts Festival, is putting together a country version to take place May 5th and 6th, 2007. Artists on the bill so far are Willie Nelson, Lucinda Williams, Kenny Chesney, George Strait, Emmylou Harris, Earl Scruggs and Nickel Creek. (Read article at Pollstar)

• Brooklyn band Mgmt has signed with Columbia. (Read article at Hits)

Posted by Glenn at 12:30 PM | Link
|Live Music||Mobile Music||Sony BMG||Warner Music Group|

• Another note from the Trans World conference call, which I had not heard or read yet: Tower will close its stores around December 15th but may leave a few open past that date.

• Kevin Lyman, co-founder of the Vans Warped Tour is one of the co-founders of Chaos Mobile, an online portal aimed at the Warped market. ChaosMobile will have both exclusive and non-exclusive content on an a la carte and subscription basis. Currently the site offers music trutunes, voice trutones and wallpapers. (Read article at Texas Gigs)

• Southern California radio stations KKGO and XSURF will begin simulcasting country music on December 1st. Some of the on-air personalities will come from KZLA, which stopped playing country last month. (Read article at Los Angeles Times)

Posted by Glenn at 8:10 PM | Link
|Brick-And-Mortor Retail||Mobile Music||Radio|

• Entertainment retailer Trans World lost $11.4 million in the third quarter of 2006. Sales increased by 23% due to the company's acquisition of Musicland. Comparable store sales decreased 5%. Accessories sales were up 40% and electronics sales rose 41%. Trans World expects music and DVD sales to account for 40% of fourth quarter sales. (Read article at Albany Business Journal, download PDF of 8K filing)

• Mercora signed deals that will put its mobile service into over 350 sites and storefronts (ranging from CBS to Verizone). (Read post at Digital Music News)

• A story of Branson B., "hip hop's version of the Dalai Lama," and hip hop's abandonment of Cristal champagne. "A self-taught oenophile, Branson has spent years developing his own high-quality champagne and has just begun rolling it out in select venues nationwide." And he's trying to build the brand with the help of his hip hop friends. Mentioned in the article: Foxy Brown will launch a brand of sparkling wine, and Ja Rule and DJ Clue will have branded beverages as well. (Read article at Fast Company)

• An interview with EMI's CEO, David Munns. "The power lies with the consumer, and they're going to either accept some of these (business models) or not. And we don't know what they are, so I want to be in all of them." It's about time an executive reached out to the technologists. Interesting that Munns' example of the long tail in action is the fact that Pink Floyd's Dark Side of the Moon, an old album not exactly struggling for attention, is in iTunes' Top 30. Some think the long tail is all about unknown artists, but I'd but Munns' long tail is filled with EMI back catalog. (Read article at News.com)

• Bad Boy Entertainment and Block Enterprises have renewed their joint venture, which is responsible for Yung Joc, Boyz N Da Hood and an upcoming album by Boyz member Big Gee. (Read press release)

Posted by Glenn at 12:14 PM | Link
|Brick-And-Mortor Retail||EMI||Mobile Music|

• Victory Records has sued Virgin Records and parent company EMI, claiming tortious interference with contractual relations (they tried to steal away Hawthore Heights). (Read article at Reuters)

• Financial Times reported yesterday that Google is "engaged in a frantic round of negotiations aimed at persuading traditional media companies to supply their content to YouTube." Company cheif executive Eric Schmidt is said to have met with CBS, Viacom and other major media companies, "offering tens of millions of dollars in upfront payments for the right to broadcast their video content legally on YouTube." If EMI was mentioned in the article, there would have been a music slant in this post. (Read article at Financial Times)

• After the unveiling of Cingular's music subscription services, a report that all is copasetik between Apple and Cingular. (Read post at Digital Music News)

• The latest new business model: Reuters on Sellaband.com, a website that allows music fans to invest money in bands. Once a band reaches a threshold ($50,000 is mentioned, in $10 increments) it gets access to a studio and professional assistance (producer Tony Platt will work with bands). Fans gets a "free" copy of the resulting CD and "a cut of CD sales and a share in advertising revenue generated for the site." Sellaband keeps 40% of the music publishing revenue as well as all the interest from the escrow accounts that hold fan donations. At even a modest interest rate, the company could do pretty well just from the escrow accounts. The longer it takes for a band to reach $50,000, the more interest Sellaband makes. No word on what happens to fans' money when a band doesn't reach the threshold. (Read article at Reuters)

Posted by Glenn at 11:05 AM | Link
|EMI||Mobile Music|

There has been a lot of chatter on the Internet about Cingular Wireless and its new music service. (Read press release, a post at Mococo News and a Digital Music News commentary.) The Windows Media Digital Rights Management-driven, MobiTV-developed service promises "your music, your way." It will have content via subscription services from Yahoo! Music, eMusic and Napster.

If "your way" means over-the-air downloads, hold on a second. Songs from all three music services -- which users subscribe to separately -- cannot be downloaded to the phone over the air. All songs must be side-loaded from the user's PC. Users do have the ability to purchase tracks from the mobile phone, but the track will be delivered to the user's PC. For the truly mobile, Cingular will offer a streaming XM subscription -- $8.99 per month for 25 stations.

Cingular's service teases consumers with delayed instant gratification. At first glance it seems counterintuitive. Why keep a mobile device from making over-the-air downloads? Just look at the confusion/disgust when Microsoft announced that the Zune portable media player would have WiFi capabilities but would not be able to communicate wirelessly with the Zune marketplace or the base PC. (About the new services, Engadet wrote the "lack of mobile song purchasing straight to a handset seems to sort of miss the point"). If it's wireless, the thought goes, then why not go all the way? Aren't Zune and Cingular missing out on a gold rush of impulse, on-the-go mobile purchases?

It's a reflection of -- maybe the result off -- two important facts: the average person doesn't buy many digital downloads and mobile music needs a link to personal computers. An iPod is loaded up with tracks ripped from CDs or taken from P2P. Subscription services are a growing niche -- but still a niche. Cingular is, in effect, acknowledging that CDs and P2P drive music listening behavior, not over-the-air downloads, and certainly not over-the-air downloads in a subscription ecosystem.

Posted by Glenn at 4:12 PM | Link
|Mobile Music|

• Later this month, eMusic will lower the number of downloads for each of its subscription packages. The $10 plan will drop to 30 from 40. The $15 plan goes to 50 from 65. Existing customers are not subject to the change. The new prices will take effect November 21th. Given eMusic's revenue-sharing model, artists and labels like it when the denominator decreases. Consumers end up paying more per download -- but it's still a great value. (Read article at The Register, via Digital Music News)

• Unavision Communications Inc. has acquired the remaining 50% of Mexico-based Disa Records and Edminosa Publishing. Disa will remain with Universal Music Group. Edminosa will fall under Univision Music Publishing. (Read press release)

• Ludacris announced a development deal with The N Network that will make the rapper executive producer of a television series called "Halls of Fame." (Read article at SOHH.com)

• A rumor that Steve Greenberg may be looking to relaunch S-Curve Records. (Read post at Hits Rumor Mill)

• NPR has a story on Mitch Koulouris, a former Tower Records manager who started Digital Music Group. (Listen to interview at NPR.com)

• The Department of Justice dropped its investigation into Entercom purchases after the company agreed to sell three stations in the Rochester area. Post-sale, Entercom will have about 40% of the Rochester market's radio ad revenue. Before the sale of the three stations, the company would have had over 57% of the market. (Read article at FMBQ)

• A clarification on a post about Snocap's recent deal to put music on MySpace pages. Snocap's publicist informs me this is separate from the Linx web development toolkit. The Snocap MySpace store, I'm told, is an HTML widget that plugs the storefront into existing websites.

Posted by Glenn at 9:03 AM | Link
|Legal||Mobile Music||Radio||Universal Music Group||XM||eMusic|

• First the revenue warnings, now the spin. EMI is downplaying its expected drop in revenue by saying digital revenues are growing at a healthy clip. Forbes.com thinks EMI is sending "mixed messages." Indeed. Digital growth -- a song here, a song there -- comes at the expense of CD sales -- ten or 12 songs at a time. The rates are going in opposite directions. If EMI's revenues will be down 4%, it seems the company may not have the right strategy to make up for the loss of CD sales. The bottom line could be fine, though. Revenue growth -- or at least stability -- would certainly please investors, but a stable net income would practically be cause for celebration given the tough environments the majors are in these days. (Read article at Forbes.com)

• Big ringtone news: The US Copyright Office says compositions for ringtones may be subject to a compulsory license. (Read article at Billboard.biz)

• Diddy will team up with the new Best Buy Digital Music Store to promote Play, which goes on sale today. To purchasers of an album download, Best Buy will offer the exclusive Diddy track "Come To Me" (Remix) featuring rapper T.I. CD buyers get free shipping and the exclusive track "Get Off." What are the odds that every Best Buy store in the country is going to be packed to the gills with Play? Pretty good, I'd say. (Read press release)

• More Diddy news: EMI Publishing was resigned the entrepreneur to a longterm publishing deal. (Read post at Hits Rumor Mill)

• The Boston Herald asks people, "Will shoppers care when the last record store goes out of business?" A few "it's sad" comments, and one that oddly places music in the luxury category. (Read article at Boston Herald)

• Nokia finalized its $60 million acquisition of digital music distributor Loudeye. Nokia intends to use Loudeye to broaden its mobile music offerings. The press release puts forth the company's goal: "Our vision is to enable people to access all the music they want, anywhere, anytime and at a reasonable cost." Coolfer looks forward to finding out what that "reasonable cost" will be. (Read press release)

• There's plenty of talk at The Velvet Rope about Jumaine Dupri's dissatisfaction with sales of Janet Jackson's new album 20 Y.O. One of the longest one-day threads in recent memory. There are two sides: Jermaine Dupri screwed up and should be ousted as head of Virgin's Urban department. Or, the buck stops with boss Jason Flom. Both sides seem to agree the album is weak. Post-EMI Mariah gets referenced a few times, naturally. (Read thread at The Velvet Rope)

Posted by Glenn at 8:43 AM | Link
|EMI||Mobile Music||Online Stores/Services||Ringtones|

• Citigroup is optimistic for the second half of 2006, upgrades EMI to "buy" from "hold." (Read article at NewRatings.com)

• Newsweek's Brad Stones asks of YouTube: "Is it worth a billion dollars, or is it just another company in need of a business model?" He covers the usual Warner Music Group v. Universal Music Group angle, then digs into what one analyst called YouTube's "winner's curse." (Read article at Newsweek)

• Here's a mobile music news bit that I actually find interesting: Motorola iRadio will preview J Records/Arista Records albums. The first offering is Monica's latest single, "Everytime Tha Beat Drop," and other songs from her album The Makings of Me. (Read Press Release)

• Bridge Ratings reports "sluggish" satellite radio sales, especially to the youth market. The research company has lowered its third quarter estimates for new subscriber acquisitions. (Read article at Radio & Records)

• Napster and Tower Records Japan introduced the first subscription-based service for the Japan market. NTT DoCoMo will offer the service to mobile subscribers. The service offers over 1.5 million songs. (Read press release)

• The tail just gets longer and longer: Shout! Factory will release two catalogs, Biograph (early jazz and blues) and Black Top (blues), comprising 10,000 tracks through digital distributor Digital Music Group.

Posted by Glenn at 8:18 AM | Link
|Digital Distribution||EMI||Mobile Music||Online Stores/Services||Radio||YouTube|

In the last week Coolfer has run across a couple of new ways mobile phones are used to connect with bands. Neither have anything to do with over-the-air downloads or anything terribly fancy. Both use good ol' text messaging.

WiredSet allowed Austin City Limits attendees to send a text to receive an email with set lists from every band that performed at four of the festival's stages. It was a free service from ACL and iTunes (normal carrier charges applied). Information is at the iTunes ACL page.

Also, I discovered Mozes through this post at the Sacramento Bee's 21Q blog. Mozes, currently in beta, enables fans to connect to bands with their mobile phones. The band sets up an account at Mozes and chooses a keyword. Then the band tells fans to text their band keyword to 66937 (MOZES) to receive a SMS response and other information online.

I like both of these text offers. They're easy, inexpensive and they're possible with any text-enabled phone.

Posted by Glenn at 11:34 AM | Link
|Mobile Music|

The CTIA Wireless I.T. & Entertainment Conference is hapening through tomorrow. With mobile music becoming such an important avenue for growth and innovation, the conference's goings on are worth following.

Digital Music News has posts on the majors' continued resistance to the MP3 format, the growth of ad-supported models, how small issues (like dropped calls and billing issues) could hamper multimedia adoption and recent mobile innovations.

Wireless Week has thorough notes from the first day's unveilings.

The Seattle Times' Tricia Duryee has an article today with some CTIA-related news about Seattle area companies

The San Jose Mercury News ran an article today about two studies released in conjunction with CTIA that show consumers aren't willing to pay extra to watch video on their mobile screens.

A post at CNETs Gadgets Blog.

Posted by Glenn at 11:14 AM | Link
|Mobile Music|

• NPD Group research reveals hip hop accounted for 23% of all ringtone sales in July. Roc was 17%, pop was 11% and alternative was 8%. Women downloaded 53% of all ringtones. (Hits Rumor Mill)

• The Internet is about democratization, but wireless has the starpower: Beyonce's music and fashion line will be the object of a mobile game being developed by Starwave Mobile. (Press Release)

• Add the Barenaked Ladies to the list of artists selling their music on their MySpace page. At the $0.89 per track price point, the band is actually taking in less than Snocap gets per sale; Snocap takes $0.45 per track and splits it with MySpace. (Barenaked Ladies at MySpace, via Digital Music News)

• This CNNMoney.com article says demand for MP3 players at Best Buy is cooling off. The retailers is shifting toward flatscreen televisions to compensate. (CNNMoney.com)

Posted by Glenn at 7:27 AM | Link
|Mobile Music||MySpace||Research||Snocap|

• Universal Music Group and MTV are expected to announce today an agreement that will give MTV a blanket license to use UMG songs and videos in mobile programming. A digital executive at UMG points to exclusive, mobile-only content that he hopes will build awareness for the medium. (LA Times)

• Warner Music Group's Asylum Records signed a marketing and distribution deal with Atlanta-based hip hop label Aphilliates Music Group. Asylum acts as an incubator for WMG and has a good track record with albums by Mike Jones, Bun B, D4L and Cam'Ron. (NewYorkBusiness.com)

• Retailers, find a pen and some paper and start that letter to your Congressman: Transworld stores will be the exclusive retailer of Daryl Hall & John Oates’ Home for Christmas, out October 3rd. (Hits Rumor Mill)

• eMusic, the independent-minded music download service, has officially launched its European service to all 25 member countries of the European Union. (Reuters)

Posted by Glenn at 7:14 AM | Link
|Brick-And-Mortor Retail||Mobile Music||Universal Music Group||Warner Music Group||eMusic|

• WEA Corp, Warner Music Group's distribution arm, inked a deal with Latin label Union Records. WEA will "market and distribute select music titles" from the label's roster, which includes Juan Fernando Velasco and Danilo Parra. (Press Release)

• Digital Music Group has acquired the Digital Rights Agency for $3.2 million in cash and 420,000 shares of DMG stock. (Digital Music News)

• EMI and T-Mobile UK are testing an ad-supported music video service for mobile phone subscribers. (Forbes.com)

• Speaking of EMI, Lehman Brothers has downgraded its stock on fears of weak first half sales. (Sharecast)

• Disney's "The Cheetah Girls 2" soundtrack cashes in on the same tweeners that made "High School Musical" such a huge hit. (LA Times)

• The Boston Globe's Joan Anderman highlights four upcoming albums "that -- with a little luck -- could take the world by storm." The four artists are Lupe Fiasco, Sting, Lady Sovereign and missFlag. (Boston Globe)

• A 16-year-old girl has sued Atlantic Records over a sexually explicit video that was taken at a Buckcherry concert in October of 2005. The band wasn't signed to Atlantic until the following May, and the label says it edited the video and took out the underage girl. The Internet being the Internet, versions of the original edit can still be found. (LA Times)

• Where did the payola settlement money go? Some of it ended up funding for summer artst festivals like the Hudson Valley Bluegrass Festival. (Poughkeepsie Journal)

Posted by Glenn at 9:14 AM | Link
|Digital Distribution||EMI||Legal||Mobile Music||Payola||Warner Music Group|

Billboard's Anthony Bruno wrote an article on mobile music, and one bit stood out. Bruno correctly indentified the main challenges.

"There are several technical and business-related challenges that must be resolved before this can become a reality. First, carriers must develop a service delivery platform that allows users to buy multiple application types in a single download. Second, labels and carriers must determine exactly how much content should be bundled together and at what price."

Labels' pace in building new digital and mobile models can move only at the speed that new retail and distribution infrastructures are built. Also, developments in hardware will enable new business models. The content is there. How will that content get to consumers? Of course, labels need to do what they can to encourage new models. Lately they've been doing just that, licensing content to start-ups and being more open-minded about experimentation.

Posted by Glenn at 5:05 PM | Link
|Mobile Music|

Billboard's Anthony Bruno writes about the creative ways major labels are using mobile technology to promote their artists. Warner Music Group released its first video game built around Atlantic Records' rapper T.I. Capitol is pushing The Panic Channel via a promotion with Sprint and GoTV. The Black Eyed Peas' Fergie will get a mobile push for her debut solo album. It's forecast to be big business.

"According to research group Infonetics, the global market for mobile-video services is set to reach $5.6 billion by 2009, from $46.2 million this year -- an increase of nearly 12,000%. An Informa forecast pegs the more mature global mobile-gaming industry at $7.2 billion by 2010, up from the $2.4 billion expected this year. To reach these numbers, the mobile industry is relying heavily on recognized entertainment brands to capture attention and encourage more traffic to these fledgling formats."

Posted by Glenn at 1:38 PM | Link
|Mobile Music|

Last week's deal between Warner Music Group and China Unicom was a popular news topic last week. The sight of a music company looking to the future left everybody feeling upbeat, almost as if the days of lawsuits and rootkits were in the past.

Billboard looked at the advantages in the deal:

"Reaction to the new deal within the region has been generally positive. 'It makes sense because it takes away a lot of the doubt of working with a service provider,' says Ashley Whitfield, managing director of Hong Kong-based entertainment company Evolution. 'It gives (Warner) much greater control of their content.'"

Red Herring sees WMG as a leader in digital music:

"Warner Music Group continued its real-time metamorphosis from an old-school music company to a digital music industry bellwether with its announcement Tuesday that it struck a wide-ranging deal with China Unicom, the world’s third-largest mobile operator."

Digital Music News:

"As part of the new partnership, Warner Music will license ringback tones, master ringtones and artist greetings by Warner Music artists to China Unicom, a move that will raise the catalog profile considerably. A significant number of artists in the deal are Asian stars."

For the official party line (literally) on legal digital downloads in China, read this article at China Daily.

Posted by Glenn at 1:10 PM | Link
|Mobile Music||Warner Music Group|

The pre-release single used to go to radio. Now it sometimes goes to cell phones. And in one case, as profiled in an article by The Washington Post's Yuki Noguchi, Capitol Records' Yellowcard was part of a multimillion-dollar ad campaign for a Verizon promotion.

Noguchi gives examples of ways music promotions are being integrated into wireless services, has quotes from various executives and analysts and, all in all, gives a good overview of the changes that have occured and will be in store.

But nowhere in the article is any evidence given that "cellphones supplant radio in promotions," which is part of the article's headline. Terrestrial radio may be an unexciting topic to a lot of reporters, but its relevance is still far ahead in this country.

Billboard's Antony Bruno looked at how mobile music is looking beyond ringtones. In the coming weeks, he wrote, several wireless companies are expected to launch alert tones -- a very brief segment of a song that lasts from two to five seconds.

Why so much buzz on mobile music? First, there's a lot of money to be made. In December of 2005, NPD research showed current ringtone buyers would pay $3.25 per 30-second ringtone -- well above the $2.50 average -- and future buyers set a target price of $1.75. And everybody has a mobile phone. That ubiquity alone has labels chomping at the bit. And mobile music services are, for the time being, closed environments that will allow sales growth with fears of P2P.

Posted by Glenn at 3:22 PM | Link
|Mobile Music|

Only mentioned briefly yesterday (the email arrived just minutes before the morning business post went live) the deal between Warner Music Group and SK Telecom of South Korea deserves another post and additional info.

While Coolfer is on the record as saying WMG and Edgar Bronfman haven't done much to live up to the hype, this move shows a forward-thinking strategy that may belatedly earn the major music company its reputation for digital innovation. This deal, though, is for South Korea only. But consider it a test for other markets.

Yesterday's Wall Street Journal underscored the magnitude of the development. Wrote Ethan Smith:

"The deal is unprecedented: No major music company has ever fully merged its operations with those of a communications network. The move hightlights the growing importance of mobile phones as a buying platform for buying, storing and listening to music. In South Korea, sales of music to mobile devices now far outstrip CD sales. As CD sales have fallen world-wide amid piracy, competition and other problems, digital-music sales over the Internet have been slow to catch up. But mobile phones have proven to be an unexpectedly rich source of music sales, particularly in Asia and Europe."

Digital Music News pulled a few striking quotes from Bronfman speaking during a Music Matters keynote address:

"To those cynics and skeptics who keep telling us that consumers who can buy tracks individually will buy only one or two tracks on an album and that our profits will plummet...to those people I say, the unbundling of the album will drive consumption, not impede it."

That's a bold prediction, but one the industry needs to believe is true. The alternative, playing the protectionist with the album format, isn't an alternative.

A PDF of the address is here.

Posted by Glenn at 2:54 PM | Link
|Mobile Music||Warner Music Group|

• Meet Vernon Irvin, an executive at media security company VeriSign who has worked with Jamster, which VeriSign purchased in 2004 for $270 million, to bring ringtone's into the big leagues. In 2005 Jamster made nearly $600 million. Highly recommended reading. (SOHH.com)

• Citing an increased subscriber base and its deal with EMI, UBS analyst Lucas Binder is optimistic about Sirius Satellite Radio ahead of the company's first quarter results. (Forbes.com)

• Music and fashion...together forever. Lyric Jeans and Warner/Chappel Music have signed an agreement that will give Lyric Jeans non-exclusive access to approved songs from the music publisher's catalogs. (Investors.com)

• Toby Keith handed out exclusives to four different retailers for the release of his latest album, White Trash With Money. Wal-Mart got a special two-pack CD/DVD, Best Buy got a bonus DVD, Target got access to pre-release tickets and Circuit City got a free koozie with purchase. I don't mind saying I had to Google the word koozie to find out what it is. (In-Store Marketing Institute)

• One in three college students downloads music illegally, according to a study. Nearly three-quarters believe the practice helps up-and-coming musicians. Coolfer's estimate: About 0.4% actually download up-and-coming musicians. (TheDartmouth.com)

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Posted by Glenn at 9:00 AM | Link
|Mobile Music||Satellite Radio||Sirius||Warner Music Group|