DIGITAL MUSIC NEWS

European Regulators To Decide Tomorrow On Universal-EMI Probe   As expected, Vivendi's Universal Music is likely to undergo a lengthy in-depth investigation into its $1.9 billion offer to acquire EMI's record labels, with the country of Brussels voicing concerns that the merger could tilt the balance of power in the digital music business unfavorably. Following a preliminary examination, the European Commission this week expressed concerns about the impact on competition from the purchase of EMI, suggesting that a full investigation into the transaction, which would reduce the market to just three major recording companies, is almost inevitable. As reported by the Financial Times, European competition officials are paying close attention to the power of an enlarged UMG on digital music services such as Apple's iTunes and Spotify, and the potential for the label to drive up prices or pose an obstacle to digital newcomers. The case will partly rest on demonstrating that UMG is heavily restrained by the "countervailing power of big retailers and online music services," the Financial Times says. If the transaction ultimately is approved, Universal would hold about 40% of sales in Europe. Regulators are expected to announce a decision tomorrow (March 23). (Full story: Financial Times)

Sean Parker Says Spotify Will Overtake iTunes In 2 Years   Sean Parker, the co-founder of Napster, early partner in Facebook, and all-around digital entrepreneur, boasted at the SXSW conference in Austin this past weekend that Spotify - a company in which he has invested - will overtake iTunes within two years. To be clear, Parker's statement actually refers to the revenue the two companies pay to their rights holders and, since iTunes sells tracks and Spotify sells subscriptions and advertisements, his prediction is an apples-to-oranges comparison. As noted by Billboard.biz, iTunes pays out 70% of revenue to rights holders, while Spotify pays out 65% to 70% of revenue in content costs. Additionally, iTunes generated an estimated sales of $1.7 billion last year, an amount that's expected to hit $2.08 at the end of 2013. Therefore, Spotify would need somewhere around 12.34 million U.S. subscribers to reach $2.08 billion in 2013, including revenue generated from subscription fees and advertising. "That would be an incredible feat for Spotify considering it had just 250,000 U.S. subscribers last October and U.S.-leader Rhapsody has a bit over 1 million after 10 years," writes Billboard's Glenn Peoples. "It's not unreasonable to think the company could get there someday, but doing it on Parker's accelerated timeline will be incredibly difficult." (Full story: Billboard.biz)

HTC's Beats Reportedly Close To Acquiring MOG   Handset maker HTC Corp.'s Beats Electronics reportedly is in discussions to buy the digital music subscription service MOG for an undisclosed sum, in a deal that could be announced by the end of next week. Negotiations apparently are in their final stages, and if the deal is finalized it would signal Beats' market power and what the New York Times calls the tightening competition among digital music companies. A deal linking HTC, Beats, and MOG "would close the loop in terms of a vertically integrated offering," said Ross Rubin, an analyst with the NPD Group, a market research firm. "The playback device, the service, and the listening device could all be optimized for Beats." News of talks between the two companies first was reported by Business Insider, and representatives for both companies declined to comment, although on Tuesday (March 20) HTC issued a statement saying, "Rumors and speculation of an acquisition of MOG by HTC are untrue." Of course, that denial appears to be a case of splitting hairs, since it's HTC-owned Beats that reportedly is involved in acquiring MOG. (Full story: New York Times)

New WahWah App Turns iPhone Into Online Station   WahWah.FM this week announced it has created an app that enables the user to convert the music stored on his or her iPhone into an online radio station capable of streaming to a worldwide audience, or just to people near the person's physical location. HypeBot says "broadcasting" is remarkably easy with the app, which scans the music library on an iPhone, including all identified tracks in the playlist. "[It] allows every person in the world to become a live broadcasting radio station," wahwah.fm's head of communications Ari Stein said in a statement. "You choose your music, you press 'play,' and the second you press 'play,' you're live and on air. Whatever you're playing at that moment, anyone else can listen to you." The app was launched in late February in Germany, and appeared in the U.S. just this week. Essentially it works by scanning an iPhone's music library and providing a live feed back to the WahWah servers, which other listeners then can access. "Wahwah.fm has a live feed, every second, of users coming in that are broadcasting their own music," Stein explains. "You can choose stations to listen to based on the person, the channel, and the songs that are playing at that moment. It's like sifting through shortwave radio, and at any time, you can stop and listen to the song you want. If you get off the plane in Buenos Aires, New York, or wherever you are, the closest users show up immediately. Immediately, you get a perspective into the local music scene." What isn't initially clear is who pays for the digital streaming performance fees, if any. (Full story: HypeBot)

Vinyl Sales Are Up, But Don't Expect A Comeback   Every several months some news agency reports that sales of vinyl LPs are resurging and that more and more music lovers are returning to that time-honored analog format. That's a nice, warm, fuzzy concept, but the reality is that the uptick in sales is incrementally small and very likely due to the novelty of actually having a full-sized album with cover art, lyrics, and something that artists and band members actually can sign. Truth is, Nielsen reports that while vinyl album sales increased 25% in 2011 vs. 2010, they still only accounted for about 1.5% of physical record sales. And while analysts and bloggers write about new "tangibilities" and "physical mementoes" and "fan connectivity," much of what is driving this tiny sales blip is simply a lingering nostalgia in an era of digital files consisting of nothing more than zeroes and ones. "Digital music has created the resurgence in vinyl that we are seeing right now," Jennifer Freund, head of DoradoPkg, told an audience of "vinyl-heads" at SXSW last weekend. "Bands want to have that connection with fans, they want that physical connection." Having a real product to hold in your hands provides that fix, but even today's vinyl album often includes inserts with digital download redemption codes. "[Vinyl] is almost the deluxe version of digital," Jay Millar of United Record Pressing Millar told Digital Music News (no relation to this publication). "It's something the band can sign." (Full story: Digital Music News)

Pandora Makes Key Ad Sales Appointments   For months digital music service Pandora has said it would be ramping up its advertising sales in order to compete more directly with the terrestrial radio industry, and this week the company backed up that promise with the announcement of three key appointments. Tommy Pizzo, formerly with BrightRoll and AOL, has been named Regional Vice President of the East Coast, focusing on "providing clients with innovative, cross-platform advertising solutions for brands of all sizes and industries." Brian Colbert is Pandora's new VP of Mobile Advertising Sales, charged with helping advertisers reach their target audience across the music service's mobile platform. And Brian Mikalis has been promoted to SVP of Monetization and Mid-Market Sales, and will work directly with advertisers and partners that are looking to reach their target audience through audio, video, and display advertising opportunities. (Full story: SECfilings.com)

Al Bell Presents American Soul Music ... And American Soul TV If you're into classic and contemporary Soul, R&B, Blues, Gospel, Jazz, Hip-Hop Soul, Rap Soul, and Neo-Soul, we invite you to listen to Al Bell Presents American Soul Music. Former Stax Records owner and Motown Records Group President Al Bell personally has programmed this awesome radio station online, presenting your favorites from the 1960s and '70s [and some '80s], a lot of the best new music that's being released today, and some real gems you haven't heard in a long, long time. Come to www.AlBellPresents.Com and hear it for yourself!