Posts filed under: Music
SanFran Music Tech Summit
I had a fantastic time today at the San Fran Music Tech Summit, catching up with old friends and finally putting a voice and face to some of those blogs I read. Congratulations to Brian Zisk for putting on a truly great event. It’s not every day one gets to discuss such heady topics as playlist formats, media packaging, and open API’s for music recommendations, all while drinking soju cocktails.
I also (deservedly) received some flack for not blogging for a long time. That is changing now ;)
See you all at sxsw!
On DeepRockDrive and brave new business models
Around the end of last year, a site I had the pleasure of working on for almost a year and half went live. It’s called DeepRockDrive, and in a nutshell, it serves as both an online community, and a platform, for fans of live music.
Here’s how DeepRockDrive works
It starts off with a fan going to the site and creating a “petition” to get their favorite artist to perform on DeepRockDrive. They can then take this digital petition and embed it on myspace, facebook, their blog, etc…, the goal being to get as many people as possible vote on this petition. Once a petition gets over 1000 votes, DeepRockDrive will contact the artists management and book the band for an in studio performance at DeepRockDrives headquarters in Las Vegas. Fans pay $6.99 to watch the show live in quality HD video, and the money is split 50/50 with the artist. You can find out more about the site here.
One interesting aspect about crowd sourcing the “concert promoter” role of the site, is that DRD is able to mitigate the risk typically associated with booking an artist at a traditional venue. Since DRD is able to (almost) perfectly match supply to demand there’s minimal exposure to some of the large gambles that concert promoters face.
We also thought long and hard about the user experience of attending the actual show itself. One of the greatest things about live music is the cycles of feedback that exist between an artist and audience. A (good) artist is constantly gauging the audience and incorporating this information back into their performance, and while this is tricky to recreate in an online environment, we’ve certainly given it our best. For example, when you go to a show on DeepRockDrive, you can blast messages out to the band, which are displayed on huge monitors in the studio. Often at DRD shows, artists will reference messages that have been sent, responding to viewers comments. Fans can also vote on the artists set list (the digital equivalent of shouting out “Freebird” at a show) - and my favorite - A fan is able to show their appreciation for an artist by hammering their space bar on their computer, sending a ‘digital applause’ needle moving in the studio. One can also choose between 1 of 5 HD camera angles to watch at any given time. Perhaps if you play drums, you might be inclined to view the overhead cam of the drummer, in order to pick up a few tips.
I remember Danny, one of the founders, explaining that if the experience at any point felt like watching a clip on youtube, we will have failed. This is designed to be “lean forward” entertainment, rather then sit back, and while there is still room for improvement, I think it’s well on it’s way.
Big implications
I like DeepRockDrive because it’s a big idea. In a day and age of declining record sales, and doom & gloom stories of major labels, it’s refreshing to know that there are people building real businesses predicated on the question of “What is next?”. While entities like the RIAA are busily obsessed with suing their best customers, DRD founders Danny Socolof and Jeff Henshaw, have shown a great example of how it’s possible to use the internet to provide a convincing value proposition for music fans and artists alike. Live music is one of the few areas in the music business that has been on fire lately, perhaps due to the publics increased awareness of (and access to) music. Imagine a relatively unknown artist being able to perform a live show for a truly global audience (and get paid). It’s the democratizing nature of the internet applied to live music, it’s a huge leveling of the playing field, and I love it.
This weekend I read an interesting article about artists and music piracy in China and if you want any further proof about the demise of the current recording industry, one has to look no further then to this story and the rest of the developing world. I remember when I was traveling in South America, I came across a local music shop in a small town where the shop was no more then a guy with a computer hooked up to the internet, with a bittorrent client running. He had a list of albums you could purchase, and after you selected the album, he burned a copy for you, and then printed off a cover on a laser printer. Since an internet connection was far from ubiquitous in this town, a lot of people purchased music through his store. My point is the days of selling a physical disc with music are done. It was a nice hundred years, but it’s time to move on and build what’s next, and I’m confident that DeepRockDrive will be part of that.
iLike update
Fresh off the iLike blog comes an announcement that they have reached the 1 million user mark, after only 6 months. Impressive!
More impressive (to me) is how concert information is now being shown throughout the site, but sadly not in the iLike sidebar yet. With the recent infusion of Ticketmaster cash, one can only speculate about how deep the integration will go. Purchasing tickets from the iLike sidebar? Bring it on!… The only downside of course are those pesky “convenience” charges, illustrated perfectly in this image from Zack.
Thanks for the link Jeff!
Gracenote / Yahoo partner for lyrics
Came across this article which describes a Yahoo/Gracenote partnership to offer an online lyrics service. The article is pretty flimsy on details, but I’m still excited.
Showing his wry sense of humour, Ian Rogers, General Manager of Yahoo said:
“Finally, a free, legal and definitive way to settle a bet with the guy sitting next to you at the bar who is certain the Ramones’ most famous anthem declares, ‘I wanna piece of bacon’”
I just hope there’s an open API of course, so we can generate awesome thematic playlists. Just imagine some of the neat queries you could add to playlist generating tools like MusicIP or Pandora - “Give me 10 songs about lost love regained”. Or if it’s a cold night out, you could generate a playlist based on the concept of “fire” (and related terms like warmth). It’s a gold mine waiting to be tapped!
This might be old news to some people, but now the rest of us can play ;)
Record labels as VC firms
Interesting story in Fortune magazine that describes how labels could act more like VC firms, taking a cut of artists touring, and merchandise - rather then just a portion of their record sales. This is the model Nettwerk Records has been using successfully for years. Label as VC firm - Artists as brand.
Instead of running a business that revolves around contracting with an artist to distribute recorded music in its various forms — CDs, digital files, whatever it may be — what if labels behaved as though they were venture capital firms, in which entrepreneurs, or artists, in this case, tap in to their patron’s deep pockets and expertise to exploit all areas of the business? That’s the idea behind merging record companies with artist management firms — and it looks like the theory will be soon put into practice on a very large scale.
The most interesting ramifications about this tweak to the business model is the alignment of common goals between artist and label. Tour revenue is up over 16 percent last year (to a record $3.6 billion), and I think this is a result of our unprecedented access to inexpensive (or free) music. If labels were to get a piece of touring revenue, they would surely complain less about file sharing, and we might start seeing more innovative music services take hold.
iTunes and EMI to drop DRM
The speculations were rampant, and today Apple and EMI announced that they will begin selling DRM free tracks. This is great news for pretty much everyone. Other rumors swirling about the joint EMI/Apple press conference involved the Beatles music finally being made available for download, and that rumor turned out to be false. Likewise, speculation about a yellow (submarine) iPod filled with the collective works of the Beatles also failed to materialize. (That one was more April Fools then the rest)
Interesting is the ‘premium’ price iTunes has attached to the DRM free tracks - $1.29 as opposed to $.99. I’m not sure I like the positioning of ‘DRM-free’ as something consumers will need to pay more for. Rather, I think a forward looking online music store should use the ‘DRM-free’ moniker as mechanism to differentiate itself from their many online competitors. eMusic, for example, has always offered DRM free music, and I would still choose to purchase music through them, rather then a DRM-free (but premium priced) iTunes store.
I’m sure the reason for the premium price is to lure other major labels into offering DRM free music as well, and so it’s really a small price to pay to watch the walls of DRM crumble and come crashing down.
More on Internet Radio from SXSW
Here at SXSW, there’s much interesting discussion on the current rate increase for internet broadcasters that will see SomaFM’s rates (for example) rise from about $20,000 to over $600,000 for 2006, and will top 4 million in 2007.
So how did we get here?
The new rate increase is based on a “willing buyer/willing seller” strategy, where the royalty rate is set on what a willing buyer and seller would both hypothetically agree to in an open marketplace. There are many issues with such a scheme, but the best came up in a discussion with Rusty Hodge, founder of SomaFM.
His (tongue in cheek) point of view was since labels (rights holders) have been convicted of massive payola scandals in recent years, where the labels pay radio stations millions of dollars to hammer out a song until it’s a hit, the “willing buyer/willing seller” have in essence reached a negative price. Payola, shows that the major labels are willing to pay massive amounts of money in exchange for air time, and therefore, the rights holder should be paying internet broadcasters to *play* their music, rather then the other way around.
He was mostly joking, but I think it’s an interesting point.
More from SXSW to follow.
Internet radio threatened
This is ridiculous. Basically the Copyright Royalty Board has accepted a new licensing fee structure set out by SoundExchange (read: the RIAA) and is now going to require online radio stations (or anyone who streams music) to pay new licensing fees that are in many cases greater then the profits the radio stations generate. Nice eh? Read this and this for more background, and then go sign the petition.
The way the music died
I stumbled across a great (if a few years old) documentary called “The way the music died”. This is a must watch for any industry follower.
“The Way the Music Died follows the trajectory of the recording industry from its post-Woodstock heyday in the 1970s and 1980s to what one observer describes as a “hysteria” of mass layoffs and bankruptcy in 2004.”
It’s an hour long, but well worth it. Watch it here