When the gods dance...

Thursday, June 6, 2013


Apple Signs Deal With Warner, Pushing For June 10 iRadio Launch

iRadio Apple Inc. reportedly has signed a music licensing deal with Warner Music Group in order to hit a June 10 launch date for its new iRadio service. Sources close to the WMG negotiations say the deal covers both recorded music and publishing rights, while the company's already-signed arrangement with Universal Music Group still does not include publishing concerns. Apple remains in licensing discussions with Sony Music Entertainment and Sony's separate publishing arm, Sony/ATV, but there's no word on whether a deal will be reached soon. As previously reported, iRadio is expected to be free and supported by advertising, and would represent a relatively late arrival by the company into what has become a fast-growing - if low-margin - sector of the music business. Pandora has more than 70 million regular users, the vast majority of whom do not pay, and similar features have been introduced by Google, Spotify, and Clear Channel (through its iHeartRadio platform). As noted by the New York Times, the licensing fees paid by Pandora have been a sore spot for music companies, which see promise in Apple's service, particularly since it can be linked to sales through Apple's iTunes store, but want higher rates. [Full story: New York Times]
Antitrust Violation Could Be Obstacle To iRadio Service

LawsuitWhile Apple reportedly is starting its iRadio streaming music service, possibly as early as next week, many legal analysts say there is at least one potential obstacle ahead for the company: federal antitrust laws. As the Washington Post reports, size can generate unwanted federal government attention, as Google, Microsoft and other technology companies have discovered. Experts say there are elements of a potential antitrust case against Apple, depending on how it goes about creating its streaming-music business." Simply building a new music streaming platform - even if it posed a serious competitive threat to  existing companies - would not be enough to put Apple in legal jeopardy. U.S. antitrust law is designed to protect consumers, not competitors, and more choice - especially when offered by a respected company such as Apple - is likely to please many consumers. Still, "it could potentially be a problem, depending on what Apple does," Rutgers University law professor Michael Carrier told the Post. Apple's attorneys are quite familiar with antitrust law, and this week the Justice Department went to court against the company, alleging it engaged in collusion in the e-book market. At issue: Apple's deal with five book publishers, which one government attorney has called a "straightforward case of price-fixing." By contrast, Apple attorney Orin Snyder says, "When the U.S. government brings a case, many assume it must have merit. We will demonstrate the government has it wrong." [Full story: Washington Post]
Pandora Looking To HTML5 TV Platform For Revenue, Tech Clarity

Pandora By now Pandora's alleged music licensing woes are well-known: the more people who listen to the online radio service, the more the company has to pay in terms of performance royalty fees set by a the Copyright Royalty Board. The problem is that the CPM rates Pandora and other digital music services are able to charge for advertising remains so low that these revenues effectively prohibit most firms from turning a profit. While it might be easy to say "well, guys, just charge higher rates or run more ads," the digital music platform is a fickle one, and listeners have made it clear they don't want an environment that's cluttered with ads like AM/FM radio broadcasts. This is the primary reason Pandora is counting on its new HTML5 architecture to make its service available on television sets, the premise being that the bigger the screen, the more the company can charge for advertising. But wait, there's more: Billboard reports Pandora also believes television is "a killer platform for music," not just because of that big screen for concerts and music videos, but because when people buy good speakers these days, they usually are connected to televisions. Pandora's HTML5 approach is designed to scale across a wide variety of "smart" TVs, as soon as their browsers catch up with the level of support typically found on computer browsers. [Full story: Billboard]
   Broadcasters Foundation
Townsquare Media Acquires Shuttered Music Sites From AOL

AOL Several weeks ago many publications (including this one) reported that AOL Music was shuttering several of its digital music sites. But Townsquare Media, which has significant interests in the terrestrial radio and digital music space, has acquired The Boot, The BoomBox, NoiseCreep, and ComicsAlliance from AOL in what appears to be a last-minute rescue for the brands. Terms of the deal were not released, but some staff of AOL Music will be joining Townsquare Media going forward. According to a company statement, the acquired properties "will complement Townsquare's existing portfolio of premium music and entertainment websites which include Taste of Country, PopCrush, ScreenCrush and Okayplayer, and reach more than 52 million combined U.S. monthly unique visitor." The four new assets boast a total combined audience of some 3.5 million unique visitors, with The Boot leading the way at 1.4 million uniques. Interestingly, Townsquare's EVP/chief digital officer Bill Wilson was a long-time exec with AOL, where he served as president of AOL Media with overall responsibility for the company's global content strategy. Earlier in his career, he'd served as senior VP for worldwide marketing at Bertelsmann Music Group. [Full story: Folio]
Sub Services Turn To Cover Versions When Artists Just Say "No"

The Beatles The Associated Press this week reported approximately 600 versions of Adele's Oscar-winning song "Skyfall" can be found on Spotify's subscription music service - but not one of them features Adele. The reason for this: Adele's label, XL Recordings, keeps her music off all-you-can-listen subscription platforms until download sales begin to diminish through services like iTunes or Amazon. Other artists' recordings, including the Black Keys' Grammy-winning rock record "El Camino" and all material by The Beatles (right) and Led Zeppelin, are prohibited from streaming on subscription services, as well. Instead, thousands of cover songs crowd such digital music services as Spotify and Rhapsody, and listeners are becoming frustrated and annoyed - many to the point of cancelling the service, or at least threatening to. Sachin Doshi, Spotify's head of development and analysis, acknowledges that finding covers instead of originals can be frustrating, observing that "we recognize it's a problem we haven't fully solved yet." And Jon Maples, Rhapsody's VP/product management, says the company has targeted 10,000 for deletion after customers have asked for cover songs to be removed. "It just clutters the experience," he admits. [Full story: Minneapolis Star Tribune]
High Resolution Restores Full Dimension To Recorded Music

Digital Music Remember when you saw your first high definition television program and saw the sparkling clarity, depth of field, and color accuracy that was never before visible on an old TV set? That same high resolution now is available in the audio world, as consumers can go online and purchase music so accurately captured that many audiophiles compare it to listening to a direct copy of the studio master recording. As Blast Magazine writer James Tanner reports, the process of converting a studio master for mass production causes a high degree of deterioration in fidelity that artists such as Neil Young and many others have bemoaned for a very long time. "The dynamics, the organic nature of the instruments and voice, and the dimensionality all suffer when comparing what the average consumer hears to the studio master," Tanner says. "There are a number of ways to enjoy high resolution music. There are audio manufacturers like Bryston and others that make dedicated players for this new format that sit in your rack of hi-fi gear like any other audio component. [These] digital music players access files from any USB drive, utilize no moving parts, feature a robust Linux operating system, and are optimized to do one thing: music playback. The highest resolution files have finally brought the digital music domain quite close in performance to the beloved analog playback warmth and tonality that audio aficionados speak so fondly of when referring to exotic LP record playback systems." [Full story: Blast Magazine]

Al Bell Al Bell Set To Make Major Industry Announcement

It's time to take the cloak off the mystery and reveal the details of what Al Bell has been working on - quite literally - 24/7/365! The final language of this new platform is in place and the attorneys have signed off on all the particulars, so we ask you to look for a special issue of Digital Music Digest early next week announcing the details of this new enterprise. As we noted two weeks ago, what Mr. Bell is about to do undoubtedly will create a seismic shift in the music entertainment business...and we invite you to keep an eye on this space so you can say you saw it here first

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