Saturday, December 29, 2007

Wal-Mart shuts online video shop

The world's biggest retailer, Wal-Mart, has closed its video downloading service less than a year after it started selling films online.
It stopped the service on 21 December, according to a message on the discount chain's video download website.

Wal-Mart said the decision had been forced by Hewlett-Packard withdrawing the software running the site.

The move ends a challenge to Apple's iTunes store, Amazon and Netflix to win customers who rent films over the web.

Hewlett-Packard spokeswoman Anna Ichel Buxbaum said the company had dropped the service because it "has not performed as expected" and would be looking at other digital entertainment ventures to invest in.

"The broader internet video space continues to remain highly dynamic and uncertain," Buxbaum said in a statement.


The service had launched in February offering 3,000 films and episodes of popular television shows to US customers to watch on a PC or a portable device compatible with Microsoft Windows Media Player.

The Wal-Mart downloads do not work on standard DVD players or on Apple computers or iPods.

The market for online video downloads has become very competitive with video rental chain Blockbuster buying Movielink over the summer to expand into this area.

Fox films 'for rent via iTunes'

Apple and 20th Century Fox studio are to announce a deal that will allow consumers to rent the studio's films through iTunes, media reports say.
They will have a limited time to watch films downloaded from the iTunes store, a source told the Financial Times.

If the reports are true, this looks like a new assault on the video and movie market, says BBC News technology correspondent Rory Cellan-Jones.

Apple shares traded above $200 for the first time on Wednesday.

Major event

The rumours about Apple's products and software to be unveiled at the company's major event of the year, MacWorld 2008 in San Francisco on 14 January, are swirling around, our correspondent says.

It looks like video could be a new key theme for Steve Jobs' Apple
Video sales on iTunes have been sluggish and the Apple TV - a set-top box linking the computer to your television - has failed to win a place in millions of living-rooms.

Besides, the big players in television and in Hollywood have been wary of doing deals with Apple, after seeing the position of strength that Steve Jobs' company has built up in the music business.

So the negotiations with the studios over movie rentals on iTunes have reportedly been tortuous.

Now it looks as though Fox, owned by News Corp, has decided Apple is the only game in town when it comes to getting movies onto new platforms, our correspondent says.

Legal way

Particularly interesting is the idea that Fox would sell DVDs with Apple's Fair Play DRM protection, making it possible to put a movie onto an iPod.

Of course, millions of people have already found ways of doing that, but this time, it would be legal.

Apple and Fox will be hoping this will have the same impact on consumers as the arrival of the iTunes music store, which encouraged some of the millions who were swapping songs on the internet illegally to start paying for music online, our correspondent says

Friday, December 28, 2007

Warner agrees to use MP3 format

Warner Music Group is making its music available for US downloads from Amazon in MP3 format without copy protection.
Warner had been holding out against using the format because MP3 tracks are easier to share between users and may be freely burned onto CDs.'s download store is a major US competitor to Apple's iTunes, which uses Digital Rights Management (DRM) to restrict the use of some of its tracks.

Warner's artists include Led Zeppelin, Aretha Franklin and Sean Paul.

Sony BMG is now the only major recording group not signed up with's download service, which is only available to US customers at present.

"By removing a barrier to the sale and enjoyment of audio downloads, we bring an energy-sapping debate to a close," Warner Music chief executive Edgar Bronfman said in an e-mail to Warner employees.

Amazon launched its US download store in September after reaching agreements to sell unprotected tracks from Universal Music Group and EMI.

Wednesday, December 26, 2007

Death To Music Gives Away 10 Releases For Free Download

posted Tuesday, December 25, 2007 at 10:43:30 PM by deathbringer.

DEATH TO MUSIC prodcutions have fulfilled all "anti-contractual obligations" by providing 10 releases (albums & EPs) for free over the past few months - available via the official website,

Death To Music productions is the new "anti - record label" founded by James Fogarty - previously of experimental metal project Ewigkeit, also a former founding member of Black Metallers The Meads Of Asphodel, and was launched in order to release music for music's sake rather than the usual money-driven route of labels / distros / magazines in order to get music heard.

"...all these fucking labels and other vampires of the music industry are just not neccesary anymore for artists writing and releasing music in more underground styles - for me and many, many other hard-working musicians & bands, our music is first & foremostly about getting your stuff heard by people, and certainly not about working your arse off to make money for other people..."

" a statement of intent, I have now given away everything I have ever recorded, and now look forwards to working with new projects and artists on Death To Music....."

James was tired of having to deal with record labels who didnt treat their artists fairly, and subsequently burnt all his record contracts and reclaimed the music.

The first physical release is out now in the form of James Fogarty's new politico-industrial metal project The Bombs Of Enduring Freedom's self-titled debut album. You can check out some of their material on the band's MySpace page.

2008 will see the release of more projects who are choosing to collaborate with Death To Music productions in order to get their music heard, rather than the usual route of labels / distros / magazines.

Friday, December 21, 2007

Radiohead, W/C In Digital Licensing Breakthrough

Radiohead and its long-time publisher Warner/Chappell Music have launched a unique "all rights" digital licensing service for the alternative rock band's new album "In Rainbows," can reveal.

The music publishing giant has created a global "one stop shop" solution for the critically-acclaimed set, which will enable potential rights users worldwide to secure licenses from a single destination, effectively side-stepping the label and traditional collecting societies networks.

For the new album, Warner/Chappell will administer all digital rights, including mechanical, performing, synchronisation, lyrics, master recordings, image and likeness, and will license synch rights for both publishing and master rights for TV and film synch uses in the offline world.

Jane Dyball, senior VP, European legal and business affairs, Warner/Chappell Music describes the new digital licensing development as an "experimental solution" which should benefit the Radiohead while "providing all their licensees with a new, highly flexible service."

Radiohead blazed a new trail when the band recorded the album independently, and released it digitally through its official Web site from Oct. 10, allowing downloaders to name a price to own a virtual copy.

The "honesty box" trial will conclude Monday, ahead of the album's tradition release through XL Recordings internationally on New Year's Eve. ATO Records Group will issue the album the following day in the United States, while Hostess Entertainment has a license agreement to release the album Dec. 26.

Live Nation, CTS Team For Ticketing Platform

Live Nation is entering the ticketing business. The live music giant has struck a long-term agreement with CTS Eventim, the Bremen, Germany-based ticket marketer and promoter, to launch a worldwide ticketing business, with effect from Jan. 1, 2009.

Through the initiative, unveiled today, Live Nation will exclusively license the Eventim platform in North America, while Eventim will provide back office ticketing services in the United Kingdom and ticketing services throughout Europe. Financial terms of the deal were not disclosed.

In a statement, Live Nation president/CEO Michael Rapino described the development as "a monumental step forward in the evolution of Live Nation into a next generation music company."

Rapino continued, "Eventim is the most technologically sophisticated ticketing platform in the world. Live Nation will use its most important asset, the concert ticket, to build artist careers and customer relationships, forge innovative sponsorship deals, create a fan and artist friendly secondary ticketing platform and provide a ticketing alternative for third-party venues. We believe that our partnership with Eventim will allow us to execute on this transformational vision."

Live Nation notes that the new ticketing platform will allow it to control customer data to create "enhanced ticket-based concert products," and capitalize on expanded distribution channels and sponsorship opportunities.

Meanwhile, Ticketmaster will handle ticketing for Live Nation's venues and thousands of events through the end of 2008. The contract between Ticketmaster and Live Nation dates back to 1998 and Live Nation's predecessor, SFX Entertainment. (Venues acquired as part of Live Nation's House of Blues acquisition last year are contracted with Ticketmaster through 2009.)

Sony BMG To Embrace MP3s

Sony BMG Music Entertainment is about to make its first foray into the MP3 format when it launches artist-specific digital download album cards in mid-January, sources say.

Apparently modeled on the iTunes digital download album cards, Sony BMG will place 40-50 album cards in about five large retailers. The cards will be a select mix of hit and catalog titles from artists such as Bob Dylan, Pink and Bruce Springsteen, as well as a few compilation releases.

The cards, which sources say are priced at $12.99, will come with a code that can be redeemed at a Sony BMG download store, which is expected to be called Currently, no such site is live on the web.

Sony BMG is using an intermediary company, Incomm, which specializes in gift cards, to cut the deals with accounts. Sony BMG's move towards testing MP3 has been in the works for the last few months, sources say. They also add other MP3 tests are being contemplated by the company.

Sony BMG declined to comment.

Thom hits the Radiohead treble

Thom Yorke has revealed the enormous success of Radiohead's download-only new album "In Rainbows".

The singer says the group have made more digital income from the release than from the rest of their back catalogue put together.

Earlier this year, Radiohead left EMI Records and decided to release the follow-up to 2004's "Hail To The Thief" themselves.

Yorke says it's been a rewarding financial venture for them, helped by the fact that their former label had been taking a large proportion of download revenue.

He explained: "In terms of digital income, we've made more money out of this record than out of all the other Radiohead albums put together, forever - in terms of anything on the 'net.

"And that's nuts. It's partly due to the fact that EMI wasn't giving us any money for digital sales. All the contracts signed in a certain era have none of that stuff."

Speaking to, Yorke also revealed the inspiration behind the idea to give the album away back in October.

"It wasn't nihilistic, implying that the music's not worth anything at all, it was the total opposite. And people took it as it was meant. Maybe that's just people having a little faith in what we're doing.

"It was simply a response to a situation. We're out of contract. We have our own studio. We have this new server. What the hell else would we do?"

"In Rainbows" is released on traditional formats on December 31.

Thursday, December 20, 2007

Wednesday, December 19, 2007

Universal Music Settles Lawsuit Against XM Satellite Radio

Universal and other major record labels had sued XM over its Pioneer Inno portable music player, which enabled subscribers to record music on the device for playback later.

Universal Music Group broke away from other record labels and settled a copyright-infringement suit against XM Satellite Radio, the companies said. Terms of the settlement were not disclosed.
Universal, a unit of Paris-based Vivendi, joined other major record labels last year in suing XM over its Pioneer Inno portable music player, which enabled subscribers to record music on the device for playback later. The multiyear deal announced late Monday covers recording capabilities in current and future devices, the companies said in a joint statement.

In deciding to withdraw from the original suit, Universal said XM had agreed to provide "a new and exciting opportunity for music lovers around the world to discover and enjoy our content, while at the same time recognizing the intrinsic value of music to their business and the need to respect the rights of content owners."

"We are pleased to have resolved this situation in an amicable manner," Doug Morris, chairman and chief executive of Universal, said.

XM said the deal recognizes that the company is competing in a market in which consumers have more options than ever for music. "We commend UMG for being the first music company to take this step forward with us and look forward to continuing our discussions with our other partners in the music industry," Nate Davis, president and chief executive of XM, said.

Universal, home to such popular artists as Amy Winehouse, Jay-Z and U2, had joined other labels in claiming that XM's licensing agreement did not give it the right to record, distribute, or reproduce copyrighted music. The record companies argued in the suit filed in New York in May 2006 that the Inno essentially amounted to XM acting like an online store, such as Apple iTunes, that sells music downloads.

XM claimed to have done nothing wrong, and vowed to fight the suit. Legal experts said XM would likely argue that its device was no different than a digital video recorder that enables people to record TV shows and movies for playback later.

The lawsuit asked the court for a permanent injunction to stop the service, and asked for unspecified monetary damages that would be determined in a trial.

XM and its rival Sirius Satellite Radio are seeking approval from federal regulators for a merger. The companies argue that the music distribution business is so diverse and consumers have so many options that it's unlikely the market could support two satellite radio companies. Opponents, however, say the deal would severely stifle competition.

Tuesday, December 18, 2007

Social Music Overview

Keeping with the theme of Mike’s Online Photo Editing Overview, I wanted to cover some of the entrants into social music. Music was probably the first type of rich media to really go “Web 2.0″ and it’s become a pretty popular place for startups. As a result, there are some great Rich Internet Applications built around social music. Anyone who makes music a part of their daily lives has no shortage of options when it comes to finding new music and sharing with friends.


Finetune is a relatively new application written in Flash. It’s my favorite out of the bunch and I covered it on my ZDNet blog. What makes Finetune stand out is that in addition to the standard “artist radio”, it allows users to build playlists of specific songs. The minimum playlist is 45 songs and you can have up to three songs per artist. With custom playlists, you can make sure you’re only listening to songs you want. Finetune also gets points because in addition to the web version, it runs on the Wii and there is an Apollo-based desktop client.


Pandora is the granddaddy of the bunch and it’s one of the Web 2.0 applications that Mike can’t live without. It is built using OpenLaszlo and provides the cleanest experience out of all the applications on the list. Pandora uses the Music Genome Project to generate a stream of songs that you’ll like based on how you rate previous tracks. You create stations around artists, songs or albums and you can provide feedback (thumbs up or thumbs down) on the songs Pandora chooses. Tech Crunch’s coverage of Pandora is here.

Last.Fm is another Web 2.0 veteran and is more socially-slanted than the others. Tagging is a big part of the experience and you can tag any song that comes along in addition to being able to listen to “user tag radio” which is based on tracks that users have tagged with a specific genera. has a separate desktop application that “scrobbles” the songs you listen to and generates a music profile that you can share with friends. See Tech Crunch’s coverage of here.


MOG is all about a music community. It’s very blog-centric and revolves around user pages, or “Mogs”. You build your Mog around songs you’re listening too and artists you like. That builds something like a profile for you that users can browse to and comment on. It also uses this profile to suggest other people or music that you might like. Tech Crunch’s coverage of MOG is here.

RadioBlogClub is another music service that builds playlists based on an artist or song you specify. I’ve heard the least about it, but the interface is good. When you browse to the site and type in an artist or song, it builds a playlist of 10 songs for you. In my experience the recommendation system for wasn’t the best, but they do allow you to embed their player on your blog. This seems to be the least robust of the applications but still worth a mention.


MyStrands started off as MusicStrands and is a downloaded desktop application that works with your current music players to build recommendations based on what you’re listening to. In many ways it’s similar to’s “Scrobbling” but MyStrands ties in with your mobile device and seems to provide a more social recommendation system. By tying in with music on mobile phones, MyStrands is a bit ahead of the others and it helps tie all of your music collections together. Tech Crunch’s coverage of MyStrands is here.


iLike is an iTunes plug-in that makes your music library more social. It tracks what you’re listening too and recommends songs and people with similar tastes. It hooks in nicely with the iTunes interface and recommends music as you’re playing songs. I listen to some pretty obscure stuff and the recommendations were good. They also have a widget for MySpace that is formatted to sit nicely in the “Music” section of the profile. Tech Crunch’s coverage of iLike is here.


iJigg is a digg-esque music discovery service that I had a lot of fun playing with. Users vote on individual songs and the most popular rise to the top of the front page. You can’t do any “related artists” with iJigg, but you can browse by genre so that you can target your music discovery. The iJigg player can also be embedded on other sites so you can share it with friends. As this service gets more popular, I think it will be a great way for bands to get discovered. Tech Crunch’s coverage if iJigg is here.

If you can't beat them-join them

NEW YORK (Reuters) - XM Satellite Radio Holdings Inc said on Monday it has settled a patent infringement lawsuit filed by Universal Music Group and hopes to reach deals with the other music companies.

The dispute centers around XM's portable "Inno" device, which can store and record music from satellite radio.

Major music labels including Vivendi's Universal, Warner Music Group Corp, EMI Group Plc and Sony BMG sued XM in May 2006, saying the Inno infringes copyrights and transforms a passive radio experience into the equivalent of a digital download service such as Apple Inc's iTunes.

XM said on Monday it reached a multiyear deal with Universal, which will withdraw from the complaint. It said the pact covers all XM radios with advanced recording functions, including future products. XM did not give the financial terms.

"We look forward to continuing our discussions with the other music companies in hopes of arriving at a resolution that benefits everyone, especially consumers," XM said in a statement.

Warner Music, EMI and Sony BMG, a joint venture between Sony Corp and Bertelsmann AG, all declined comment.

Warner Music is in talks with XM to try to settle the dispute and expects a resolution soon, said a source familiar with the matter who spoke on condition of anonymity.

Janco Partners analyst April Horace said the Universal agreement would likely be followed by others.

"Once you've created a precedent in how to resolve that issue, I think it's easier to resolve the others," said Horace.

She said the two companies had likely agreed to a set fee for every related device XM sells, but noted that, since these devices were not XM's highest volume products, the payments were unlikely to have a material impact on XM finances.

The original lawsuit, filed in New York federal court, had accused XM Satellite of "massive wholesale infringement" and sought $150,000 in damages for every song copied by XM customers using the Inno, which went on sale last year.

XM argued the Inno, which is manufactured by Pioneer Corp, is a legal device that lets consumers listen to and record radio as the law has allowed for decades.

"We are pleased to have resolved this situation in an amicable manner," Universal Music Chairman and Chief Executive Doug Morris said in a statement." XM is "recognizing the intrinsic value of music to their business and the need to respect the rights of content owners."

XM, with more than 8.5 million subscribers, is waiting for regulatory approval to merge with No. 2 satellite radio company Sirius Satellite Radio Inc. Sirius already has a deal with the recording industry.;_ylt=A0WTcUYWf2dHPgAB3wZHkPwA

Monday, December 17, 2007

Hi-tech tools divide social sites

MySpace - 29 million
Facebook - 15 million
Friendster - 5.9 million
Orkut - 9.6 million
Bebo - 4.8 million
Source: ComScore July 2007

Social network sites are moving to make it much easier for software developers to write add-ons for the hugely popular web destinations.
Bebo, Facebook, Meebo and Friendster have unveiled plans to help them become more than places to keep in touch.

The add-ons will allow users to add extras, such as video and music clips, to the personal profiles they maintain.

The alliances behind the technologies also reveal the fierce competition between social sites for users.

Tough choices

In one of the broader announcements Bebo unveiled its Open Application platform which will produce a set of common interfaces that developers can use to create programs and applications that will work with the social network site.

At the launch Bebo unveiled partnerships with more than 40 developers, including NBC Universal, Flixster and Gap. A sample application produced using the tools allows Beboers to create an interactive avatar that models Gap clothes.

Significantly, Bebo's interface tools will work with Facebook's already announced development system. This will make it possible for the many developers who have written applications for Facebook to use their code almost unchanged for the Bebo network.

Despite the tie-up on tools, Bebo and Facebook will not become a unified network.

Bebo said it would also support Google's Open Social initiative which aims to create a unified system of tools that can be used on any and every social network site. The Open Social tools are due to appear in early 2008.

Social networking giant MySpace is backing Google's initiative.

In a further boost for Facebook instant messaging network Meebo announced its support for the tool set. Meebo said it had no plans to support Google's initiative.

At the same time Friendster announced that its development tools would be "open" so they can work on as many networks as possible. It has declared its support for Google's Open Social initiative.

Finally, Facebook has announced plans to license its development system to other sites. Since it was announced in May 2007 more than 7,000 applications have been written for Facebook.

This series of announcements shows how keenly contested this sector of the hi-tech market has become.

The deals and technological tie-ups are all about building up as large an audience as possible in a bid to dominate the sector.

Emi boss wants more rights from artists

Emi's new owner, financier Guy Hands, wants artists signing to his label to agree to multiple rights contracts, allowing the music giant to profit from all aspects of their careers, from CDs to T-shirt sales.
Traditionally, music companies sign artists to recorded music contracts and they may also sign music publishing deals that entitle them to payment whenever the music is used.
However, Hands is understood to be planning to boost the number of multiple rights deals - sometimes called 360 degree deals. These mean the company will also take a share of tour and merchandising revenues.
One of the first to sign up was heavy metal group Iron Maiden, who joined EMI last week.
This type of deal is particularly suitable to artists such as Iron Maiden who get limited radio airplay but are hugely popular touring artists with strong record sales.
Music companies have been trying for some time to find other sources of revenue from their roster of artists as album sales fall in the face of the growth of online music.

Robbie Williams may quit EMI

Robbie Williams's manager has raised the prospect that the star could quit EMI after he completes his final studio album for the struggling record company.

The singer, who is also contracted to release a best-of compilation, has been with the company for a decade and remains one of its biggest selling acts.
But his manager Tim Clark, co-founder of IE Music, told The Daily Telegraph: ''I would be very wary about signing him to any major at the moment."
Clark refused to comment on the star's current contract terms but said ''all options" were open once he has completed his obligations. That raises the possibility that Robbie could follow Paul McCartney and Radiohead, which have left EMI in the past two years and released new albums without a major label.
Last week EMI extended its 28-year recording relationship with heavy metal band Iron Maiden, in a deal that includes revenues such as touring, merchandise and sponsorship.
Williams is set to be the first major pop act to come up for renegotiation under EMI's new owner, the private equity giant Terra Firma.
Mr Clark said the internet offered opportunities for artists to reach their fans direct without the need for major labels. ''What concerns us with old ways is that we take overpriced and shoddy services, particularly now when we have a fantastic opportunity of getting to a fanbase direct. What we really don't want is the dead hand of multinationals throttling these brilliant opportunities," he said.
EMI's historic £80m 2002 contract with Williams pioneered the so-called 360-degree deal through a joint venture which manages the star's recording, writing, touring and performing activities.
He has yet to release an album since checking into rehab following his 2006 critical flop Rudebox. Terra Firma declined to comment.
EMI's rival Warner Music recently saw Madonna quit in a $120m (£59m) deal to join concert promoter Live Nation.

Friday, December 14, 2007

Sir Paul McCartney puts his disillusion with EMI on record

Sir Paul McCartney has accused EMI, his former record company, of becoming boring and taking him for granted. The former Beatle, speaking to The Times, complained that the British record company had become too bureaucratic – and how he had “dreaded going to see them”.

“Everybody at EMI had become part of the furniture. I’d be a couch; Coldplay are an armchair. And Robbie Williams, I dread to think what he was. But the most important thing was, I’d felt [the people at EMI] had become really very boring, you know?”

Last summer, after 4½ decades, Sir Paul left EMI to join the start-up Starbucks-owned record label Hear Music, which released Memory Almost Full. The album, which attracted positive critical reviews, has sold more than a million copies worldwide since its release this summer.

Sir Paul accused EMI of being unimaginative, telling him that he should “go to Cologne” to market a new record. “This idea became symbolic of the treadmill, you know? You go somewhere, speak to a million journalists for one day and you get all the same questions. It’s mind-numbing. So I started to saying: ‘God we’ve got to do something else’.”

EMI owns the rights to all the Beatles albums, which were released on its Parlophone label or the group’s Apple label. Although Apple was owned by the Fab Four, EMI retained the distribution rights in an agreement struck in the late 1960s and continued to distribute Sir Paul’s material after the band split up.

He also complained about the long marketing lead times demanded by EMI, the so-called process of “setting up a record” in an attempt to enhance sales, recalling that John Lennon was able to force EMI to release Instant Karma a week after he had written it in 1970.

Sir Paul said that he would ask EMI to release a song “next week”, to which executives would reply: “You can’t do that these days.” When told that EMI wanted six months “to figure out how to market it”, Sir Paul asked: “Couldn’t some bright people do that in two days? Jesus Christ, I said, ‘Look boys, I’m sorry, I’m digging a new furrow’.”

The comments are a further embarrassment for Eric Nicoli, the former EMI chief executive who left the music major after its takeover by Terra Firma, the venture capital group led by Guy Hands. But Mr Hands is unlikely to be quite so concerned, as he is thought to agree with Sir Paul’s criticisms of the previous regime.

Thursday, December 13, 2007

Iron Maiden Closes Integrated Deal With EMI

Heavy metal goliath Iron Maiden has struck an integrated international recording pact with long-time label home EMI, which branches out into other aspects of the band's business, including touring, merchandise and sponsorship.

The recording deal covers the world except the United States, where Sanctuary handles the band's works. Financial details were not disclosed.

Iron Maiden and EMI have a 28-year recording relationship. Since then, the band has since gone on to sell roughly 70 million albums, says EMI, including three No. 1 albums in the United Kingdom.

And as the group prepares to embark on an extensive world tour, its management team says the timing was perfect to renew ties with EMI and bring the music major into other aspects of its empire.

"For a band with a global following like Maiden, who rely on fan word of mouth, touring and marketing/sales expertise as they receive little or no radio or TV support, it is key that the 100% support and implementation of our visual marketing campaigns internationally is both effective and enthusiastic. EMI and their worldwide affiliates have always fulfilled this," comments manager Rod Smallwood.

The band's 14th and most recent album, "A Matter of Life and Death" opened at No. 1 on Billboard's European Top 100 Albums charts, following its release in August 2006.

The group's upcoming "Somewhere Back in Time" world tour has proved a box office smash, with stadium dates in Scandinavia, South America and Australia selling out in rapid fashion. The tour is due to kick off Feb. 1 at the Bandra Kurla Complex in Mumbai, India.

Iron Maiden recently confirmed their first-ever U.K. stadium show, at the 50,000-capacity Twickenham Stadium in London on July 5.

Wednesday, December 12, 2007

It looks all Christmasy for HMV

Music and books retailer HMV has reported reduced losses as it gets ready for the festive season.
Pre-tax loss before exceptionals in the six months to October was £28.7m, down from £29.2m in the same period in 2006.

HMV's most important trading days are still ahead of it, with the retailer well prepared for Christmas, it said in a statement.

The firm has struggled in recent years against stiff competition from supermarkets and internet retailers.

"Less than a year into our three-year strategic plan, we are pleased with our progress," chief executive Simon Fox said in a statement.

"At this stage, the most important days and weeks of our financial calendar are still ahead of us, and our stores and websites are very well prepared for Christmas," he added.

Technology shift

The group, which runs the Waterstones bookstore chain as well as music stores in its own name, saw total group like-for-like sales grow 5%.

Like-for-like sales in HMV stores in UK and Ireland grew 9.2%, while sales at Waterstones were up 1.4%.

Sales at the website rose 68%.

Overall, sales of technology products, games and DVDs were growing in line with the company's strategy, it said.

HMV stores in UK and the Irish Republic were "successfully exploiting the high growth games and technology categories", Mr Fox said.

Technology now accounts for 6% of sales in HMV UK and Ireland, almost halfway to the firm's three-year target of 13%.

Microsoft buys UK mapping service

Microsoft has bought online mapping company Multimap to expand its web business, the US firm said.
Multimap, which was established in 1996, is among the UK's top 10 visited websites, receiving more than 10 million users each month.

Microsoft hopes that the acquisition "will play a significant role in the future growth of our search business".

Web search giant Google, Microsoft's arch-rival, provides its own online mapping service, Google Maps.

'Huge opportunity'

Microsoft's internet empire also includes services such as Virtual Earth, Live Search and Windows Live.

Earlier this year Microsoft bought a 1.6% stake in social networking site Facebook for $240m (£117m) and US online advertising firm aQuantive for $6bn.

It has not revealed how much it is paying for Multimap.

Sharon Baylay, general manager of the Online Services Group at Microsoft, said that the deal with Multimap presented "a huge opportunity to expand our platform business beyond the UK and globally".

Multimap has offices in America, Australia, South Africa and Turkey, as well as in London, and has a presence in 48 countries.

Spam advertasing growing LARGE

This news will come as a shock to none, but the volume of spam has continued to rise throughout 2007. So much so, in fact, that spam researchers say that electronic junk mail has long surpassed the volume of human-issued e-mail this year, despite efforts to thwart it. One company, Barracuda Networks, goes so far as to say that spam now accounts for 90 to 95 percent of all e-mail, with no end in sight.

Related StoriesListen up: MP3 spam on the rise, despite being utterly stupid
The numbers come as part of the e-mail security company's annual spam report, in which it analyzed over one billion messages sent to its 50,000 customers. Barracuda says that the percentage of spam increased from 85-90 percent in 2006, and is way up from 5 percent back in 2001. After conducting a poll of 261 business professionals, Barracuda also found that over half—57 percent—consider spam to be the "worst form of junk advertising," almost double that of junk snail mail. Only 12 percent cited telemarketers as the worst.

95 percent is awfully high (and as far as I can tell, accurately describes the ratio of e-mail that hits the server for me), but not everyone agrees on those numbers. Symantec has observed the overall spam volume increase from an average of 56 percent of all e-mail traffic in 2006 to about 71 percent in 2007, Symantec spokesman David Forstrom told Ars.
It's hard to say which company's numbers are more accurate—"Different monitors can legitimately get different results," University of Calgary computer science professor John Aycock told us. What's important are overall trends. One thing that everyone agrees on is that spam continues to morph in an attempt to get through filters. Both Symantec and Barracuda say that they have observed an increased use in file attachments in 2007, like PDFs and images, and security software vendor MXSweep says that spammers are also focusing on sending MP3 and Excel spam.

Back in April, IDC predicted that spam would overtake human-issued e-mails in 2007, but this is one prophecy that we would have preferred didn't come true. The trend shows that the 2003 CAN-SPAM Act has done little to thwart spammers from upping the ante, despite suggestions to the contrary. A few charges may have been brought against spammers here and there, but the US government can only do so much when so many spammers are located elsewhere in the world and those in the US are so difficult to prosecute.

Apple TV- have you heard about that one yet?

Why the Apple TV failed
By Charles Jade | Published: December 10, 2007 - 11:45AM CT

Way back in 1993, the first black Macintosh was a repackaged Performa LC 520 that came with a remote control—one that could control volume—and possessed a singular feature. The Macintosh TV let you watch TV using its cable-ready tuner, but not while you used the computer. It was an underpowered machine lacking expansion options, and it was canceled after a year. Fast forward 15 years and history may be repeating itself. Macworld reports on estimated numbers for the Apple TV in its first year.

“In addition to the 400,000 Apple TV units we estimate Apple has sold thus far, the company will be lucky to sell another 400,000 in the year-end holiday rush, short of our one million estimate,” said Forrester analyst James McQuivey.

Considering the level of interest, it will likely take more than luck to sell another 400,000 Apple TVs by Christmas. While "nearly half of all online adults" surveyed have heard of the Apple TV, only about 5 percent know—or apparently care—what it does, and fewer than 3 percent intend to purchase one. In contrast, Apple will likely sell 25,000,000 iPods this holiday season, but then there is no shortage of easily-available audio content. Not so with video for the Apple TV.

Forrester analyst James McQuivey previously noted that NBC Universal made up 30 percent of the video content at the iTunes Store. A year after the Apple TV went on sale, there will likely be less content available for purchase, which may be why Apple appears to have agreed to higher prices for movies. However, a lack of content is only part of the problem. People buy music and they rent movies. Nearly a year after the introduction of the Apple TV, there are rumors that rentals may be coming, but what about visual quality? The Apple TV is designed with HD in mind, but video at the iTunes Store isn't even DVD-quality.

If it isn't clear—and apparently it's not at Apple—the problem with the Apple TV is that its fate is ultimately in the hands of the content owners, not Apple. Those still thinking Steve Jobs will work out a deal with the movie studios like he did with the music labels need to understand that is exactly why he won't get such a deal. The best Apple can hope for in 2008 is high-priced, low-quality content, but that isn't going to save the Apple TV because it never should have existed in the first place.

Bill Thompson thinks that iPod is mean..

I want to admire Apple. I want to like them. In the last year I've bought - with my own money - three of its computers and two iPods, and enjoy them greatly.

But its business practices do not stand up to scrutiny, and when it comes to music downloads it is just as bad as Microsoft on servers, putting its time and energy into creating barriers to competition instead of letting its developers and designers concentrate on doing great stuff.

If Apple was serious about building a music industry around downloads and digital devices then it would open up its devices and interfaces to allow greater innovation and greater competition.

It would have faith in its own products to compete in this larger ecosystem instead of trying to lock everyone in with tactics that resemble those of IBM in the days of the mainframe.

I wrote a presentation this morning using Microsoft's PowerPoint, but displayed it using Apple's Keynote. Apple can sell Keynote because it took PowerPoint apart and figured out how the files work.

Had Apple been unable to do so, or found that every time it figured out what was happening Microsoft changed the format, it would have complained loudly.

Yet this is exactly the technique it is using against third party jukeboxes. And it is time it stopped.

Read the whole article on:

How companies confuse their customers when DRM is involved-laugh with these critics!

Last Updated: Tuesday, 11 December 2007, 11:56 GMT
The DRM maze for consumers

The last few years in the history of digital content are littered with examples of Digital Rights Management (DRM) solutions that have been accused of being over complex and consumer unfriendly.

Western Digital sells a range of networked hard drives, which allows users to share files across both a local network of home computers and across the net.
But the firm has now blocked remote access to 30 different types of media files, including MP3s and MP4s, to users running its Anywhere Access program.
The company says it has done this as an anti-piracy effort, to prevent people from copying and sharing copyright files.
But the block makes no distinction between files which are user generated, such as home movies, and paid-for, DRM-protected content.

When Microsoft introduced its Zune media player to rival the iPod it boasted a supposed killer feature - the ability to share songs wirelessly with friends.
Unfortunately, the Zune not only failed to support the Digital Rights Management system Microsoft had pioneered for its partners, it also restricted the sharing of a song to "three plays or three days, whichever comes first".
Users were able to share a song but a friend had a limited number of plays and time, in which to listen to it.
And the restriction applied to any kind of music file - even if it was a track recorded by the user himself.
Strangely, many of the songs offered to Zune users for download from Microsoft's online store could not be shared at all due to "rights restrictions".
Microsoft has now lifted the time restrictions for listening to shared tracks.

The world's largest mobile phone manufacturer has decided to tackle rampant music piracy by offering tracks for free to its customers.
The Comes With Music service will let owners of its premium handsets download as much music as they like to their phone or PC from the Universal catalogue.
There is no cost to download or a subscription fee. But there is a proviso - if users want to burn the music to a CD to play on a separate player, or in the car, they have to pay out.

Before Google bought YouTube its foray into the world of online video was championed by its own-brand video store. The Google Video store let people buy TV shows such as Star Trek and CSI, which were protected by digital rights management.
Unfortunately, when Google decided to shut down the store in favour of supporting YouTube it left customers who had bought content unable to continue to play their videos.
Google initially offered its customers credit through its own online payment service, called Checkout, but after complaints it changed its mind and offered users a straight refund.
The issue highlighted concerns that digital content bought by consumers that is protected by DRM may not always be accessible if the content producer and/or distributors removes its support for the format.

In 2005 Sony took a new approach to protecting its CDs from copying by including software on the discs which automatically installed on a PC if the disc was played in a computer.
The software was designed to prevent copying but it also left PCs open to potential hacker and virus attacks.
Consumers were not told of the software on the discs and the discs themselves gave no indication of the copy protection software stored on them.
After the problems were highlighted Sony released a tool which would remove the program from users' computers - but it too had security issues.
Sony ultimately recalled the discs with the software installed and after a series of high-profile, class-action lawsuits paid out to consumers who had bought the CDs.

When Steve Jobs issued his open letter decrying DRM on music many observers felt that the tide was beginning to shift against DRM.
Apple's iTunes store now offers users MP3s of music, without copy restrictions, from the EMI back catalogue.
But Steve Jobs has said the move did not mean an end to DRM on videos it sells via iTunes.
"The music and video markets are not parallel. The video industry does not deliver 90% of its content DRM-free," he said.

The Xbox 360 and PlayStation 3 are capable of producing high definition video, up to 1080p, or so-called Full HD resolutions.
If you buy the HD-DVD player add-on for the Xbox 360 you can playback movies in the highest resolution available today, assuming your TV can support it, while PS3s can play Blu-ray movies out of the box.
However, all Xbox 360 consoles sold in the first 18 months from launch, and the first few months in the case of the low-end PS3's availability, do not have a so-called HDMI port. This is a digital interface to output video and audio, which can encrypt the information being sent to the TV to prevent copying.
HDMI is part of a system which allows content producers to protect their material by placing a protection flag on it, called an Image Constraint Token. This means devices that do not have a HDMI port (or DVI port) will not be able to play the content at the fullest resolution.
Potentially, it means many Xbox 360 owners and some early PS3 enthusiasts would not be able to play their legally bought HD-DVD and Blu-ray movies in the best quality, despite the fact Microsoft and Sony are leading supporters of HD technology.
So far, no HD-DVD or Blu-ray titles released have used the protection flag, but the technology is there to be implemented and it could mean millions of console owners would only be able to play their films at a quarter of the potential resolution.

When Virgin launched its digital offering, including a subscription "music club", in 2004 Sir Richard Branson boasted: "With a strong music heritage behind us, as a record label and a retailer, Virgin has a huge advantage, and platform to launch a digital service that will become the ultimate destination to buy, stream, burn and enjoy the best the music world has to offer."
Like many online music stores, it came with DRM designed to prevent copyright theft and to enable users to rent their music.
But when the site shut down in September this year it left members of The Music Club unable to play their songs, because they could no longer renew their monthly fee.
For customers who had paid extra to transfer their music to an MP3 player this was doubly frustrating.

DRM explained and hacked


Windows Media DRM is used in the BBC's iPlayer
Windows Media DRM is a Microsoft-produced copyright protection system intended to "securely deliver content for playback on computers, portable devices and network devices".
The system has been updated several times since it was first released in 1999. The most up-to-date release is version 11.
Various tools have been created to strip files of the DRM, such as FairUse4WM, a program released in August 2006 by a hacker named Viodentia.
Nine days after the crack first appeared, Microsoft released a new version to prevent FairUse4WM from working. Within three days hackers released a new version of the tool.
The tool can be used to strip DRM from programmes with the BBC iPlayer.
On 13 July, a new version of the tool called 1.3fix-2 was released. It can be used with Windows Vista and can also strip DRM from songs downloaded from Microsoft's online music store, Zune Marketplace.


Several tools have been released to circumvent FairPlay
FairPlay is the DRM of choice for Apple products.
It is built into the Quick Time media player and is used by the iPhone and iPod. Protected music from the iTunes store also uses the system.
Users can copy downloaded songs to a CD and then copy the disc back on to the computer to remove the DRM - but the quality of the music is affected.
The first tool to circumvent FairPlay was a program called QTFairUse, released by infamous hacker Jon Lech Johansen, in November 2003.
Since then several versions of the program have been distributed to keep up to date with new versions of iTunes and FairPlay.
Other programs such as Playfair, Hymn and JHymn have also been developed to get around FairPlay. Following updates to the DRM and legal action by Apple, these systems no longer work.


AACS is used by both next generation DVD formats
The Advanced Access Content System (AACS) is the DRM of choice for next generation HD DVD and Blu-ray discs.
It was first introduced on high definition discs in June 2006 and uses a system of keys to decrypt content in a player.
These keys can be revoked by the AACS licensing authority if compromised.
Six months after the first discs hit shelves, a hacker known as muslix64 released a tool called BackupHDDVD which circumvented AACS on a Windows PC. Several other similar tools followed.
Many keys were made available on the internet.
In April this year, hackers discovered a method to retrieve the crucial keys using a tweaked HD DVD drive for an Xbox 360. The hack still works even when keys are revoked.


Many of the tools allow DVDs to run on open source software
Content Scramble System (CSS) is used on almost all commercially produced DVD-Video discs.
It was first introduced in 1996 by the DVD consortium.
In 1999, hacker Jon Lech Johnasen, along with two anonymous hackers, cracked the system and distributed the DeCSS tool on the internet.
Following its release, the system was also found to be susceptible to a so-called brute force attack, where thousands of different codes are tried in order to break the encryption.
On average, the DRM could be stripped off a movie in 24 hours using this method.
Since 1999, hundreds of different variants have appeared on the net, many developed to add DVD support to open source movie players.

Hard-discs block the file sharing

One of the world's largest hard disk manufacturers has blocked its customers from sharing online their media files that are stored on networked drives.
Western Digital says the decision to block sharing of music and audio files is an anti-piracy effort.
The ban operates regardless of whether the files are copy-protected, or a user's own home-produced content.
Digital activists say it is the latest step in a so-called war on copyright theft that is damaging consumer rights.
The shift to a digital world in which all forms of content, from books, music, and TV programmes to films, can be shared effortlessly around the world between people with an internet connection has produced an unprecedented upheaval in attitudes to media, copyright and consumer rights.

Tuesday, December 11, 2007

Universal Sets Music Free on Imeem

The beleaguered music industry is beginning to show more enthusiasm for free, advertising-supported business models. The latest sign: Universal Music Group has agreed to provide its songs to online social network imeem.
Imeem now boasts deals with all four major record companies, including Sony BMG Music Entertainment, Warner Music Group and EMI Group, all of which have already inked deals with the social network.
It's a sharp turnaround from earlier this year, when none of the majors were willing to sign on to imeem's new ad-supported interactive service. In fact, Warner sued imeem, arguing that by allowing its members to upload and share MP3s of Warner music, it was infringing on its copyrights.
But in July, Warner dropped its suit and struck a partnership with imeem under which the major label allowed free, full-song streaming of its music in exchange for a cut of imeem's advertising revenue. Sony-BMG Music reached a similar deal with imeem in September, followed by EMI in October and now Universal. A source familiar with the Universal pact said the label is also receiving a small payment each time one of its songs is streamed.
Fueling the shift is the music industry's continuing struggle with sliding sales of compact discs, which still account for the vast majority of their recorded-music sales. Revenue from paid music downloads continues to grow, but isn't close to making up the difference.
Imeem isn't the first ad-supported music service to gain the support of all four major labels. Universal, Sony BMG, Warner and EMI have also been making their music available to ad-supported music downloading service Ruckus. Ruckus had an early advantage over other services in securing the majors' cooperation because it targeted colleges and universities, where illegal music downloading is a particularly serious problem.
Whether imeem succeeds will depend on how robust a community it can build on its site. It claims to have 19 million users; deals with major labels and leading independent music companies will help it grow that audience further.
In the meantime, imeem says it has signed advertising deals with major marketers such as Apple, Nike, Microsoft and Toyota. Imeem's label partners are also beginning to explore promotional opportunities on the site. For instance, Warner Music has created an imeem page to promote the release of Mothership, a new Led Zeppelin greatest hits collection. Warner has posted a selection of live concert videos on the page and is holding a Zeppelin trivia poll contest.
When imeem members upload songs and videos by partner-label recording artists, other users can stream them in full. For the moment, imeem has an advantage over News Corp. social-networking giant MySpace, where Universal has restricted its song and video clips to 90 seconds, citing the absence of a licensing deal. Universal also filed a copyright infringement suit against MySpace in 2006.
In a statement, Universal Music Chairman and Chief Executive Doug Morris made it clear why his company was treating imeem and MySpace differently.
"Imeem has developed an innovative way to make our artists' music a central part of the social-networking experience," Morris said. "More importantly, they've done so the right way--by working with [Universal] to provide an exciting musical experience for consumers, while ensuring that our artists are fairly compensated for the use of their works."

Hands tries a different tune with EMI

Is Guy Hands right about EMI? That is the debate raging in the music industry as Hands' private equity lieutenants from Terra Firma crawl over the company that signed the Beatles in an effort to make his bumper £3.2bn acquisition stack up.
Hands attempts to reassure EMI stars
The former investment banker is seeking deep cost savings from an industry notorious for its rock and roll profligacy.

About time, say some executives fighting sliding CD sales and rampant web piracy. But creatives at the company behind Kylie and Coldplay fear that Hands is playing a dangerous game.He has criticised some artists for simply negotiating the best advance rather than "working with their label to promote, perfect and endorse their music", as others do.He has since written to EMI artists seeking to reassure them that they are "at the epicentre" of his plans to turn the struggling business around.
But some artists' managers question the ability of a financial wizard, whose previous investments have included pubs, landfill sites and service stations, to appreciate the subtleties of an industry famous for its stadium-sized egos.
"He's not dealing with motorway cafes in Germany or pubs," says Jazz Summers, manager of EMI indie stalwarts The Verve. "I have found him bright and willing, but since reading his statements, Terra Firma need a lesson in artist management."
Summers is a founder member of the self-styled Black Hand Gang, a clutch of EMI artist managers that look after acts such as Robbie Williams, Pink Floyd and Phil Collins, who clubbed together in recent years to deal collectively with the company on particular issues.

The gang met recently but have decided to reserve judgement on Terra Firma's radically new approach to the music industry until a review is complete.
Spearheading the artist relations part of that review is former BBC director general Lord (John) Birt, a notorious cost-cutter. Summers, however, says he thinks Birt has a better understanding of the record business than Hands.
That will be critical, say insiders, because EMI, perhaps more than any of the other three music majors - Universal, Sony-BMG and Warner - has built a reputation for taking care of its artists.
Terra Firma is believed to be turning down over half of EMI's proposed new artist signings and Hands is expected to seek fewer, more focused and better-organised investments in talent.
These will cover not just recording deals but also merchandise, live performances and media appearances, backed up by a longer-term strategy to make a return.
As part of its review Terra Firma has asked EMI to analyse a dozen artists, from international stars like Norah Jones to break-through bands like The Bees and local acts, to evaluate what type of artists will generate the best returns across those categories over time.
"It's exactly the sort of stuff they should be doing," says one industry executive. "The industry is full of executives who have been around for years who know a lot about music but are not financially or commercially literate."
But while EMI's commercial and financial departments are said to be relatively encouraged by Hands' approach, the creative and marketing types are fretting about the new financial rulebook.
Hands has declared war on waste at EMI. Parties, candles, flowers, the £5.6m Mayfair flat, they are all being consigned to annals of rock history.
"He is absolutely correct," says Jeremy Lascelles, chief executive of smaller rival Chrysalis Music. "There is a criminal amount of waste in every major record company, and that is one of many reasons why the economics of the record business have gone so awry."
Meanwhile, any EMI execs that expected an end to short-termism after the company de-listed have been disappointed.
Under previous management, many divisions in the recorded music business were being run on a three month view as the bosses strived, and all too often failed, to hit the City's six monthly forecasts.
While they await Hands' long-term strategy announcement, executives have been told they will receive no bonuses unless the company hits a £150m underlying earnings target by June of next year - again, a mere six month time horizon.
Terra Firma, which owes Citigroup £2.5bn on its purchase, is confident it can beat that profit figure, however, thanks largely to cost cutting - starting with a clampdown on CD returns.
It is understood that EMI had 65m CDs returned by retailers last year, at a cost of almost £100m. Mr Hands' team have issued instructions for the company to stop overshipping, a practice it has been accused of in the past, along with most of its rivals.
"The music industry is an extraordinary industry with which to do businesses," says Richard Corbett who founded music database company Ricall in 1998 after a career in management consultancy working for companies in many different sectors.
"Rather than people focusing on 'why should they do a deal', it's 'why shouldn't we do a deal'. It doesn't surprise me at all that someone from outside wants to come in and rip up the rule book."
But beyond the short-term savings, EMI will have a bleak future unless it uncovers new talent and gets the best out of its existing roster, say experts. Last week's pre-Christmas chart positions - just six EMI acts in the top 75 - revealed the company to be woefully lacking in both departments.
''They don't seem to having any hits at the moment, which is always a pretty good measure," says Paul McGuinness, who manages Universal Music giants U2.
''I wish them luck at EMI - it's a good business going through a bad patch. I believed [Terra Firma] when they acquired company when they said they are holding for the long term and intending to invest."
But Marc Marot, the former head of Island Records who now manages DJ Paul Oakenfold and Yusuf Islam (formerly Cat Stevens), says the key problem at EMI is common to every major label in the world.
"Capitalism and artistry are often very strange bedfellows. You can't force an artist to come up with the goods. To a large degree Hands is probably right, but to an even larger degree... no pontification from senior management anywhere will change the way artists work and think, and the more you whip them the worse things will become."
EMI's finances may be ripe for a private equity-style shake up, but this is almost certainly Guy Hands' bravest bet to date. The real unanswered question is, can he make it pay off?

Friday, December 7, 2007

Why online is better than offline

Telecom Italia France (Alice) launches free music download service

Telecom Italia’s French internet service provider (ISP) Alice has launched a free music download service for its triple-play subscribers. AliceMusic offers them access to EMI’s catalogue of more than 315,000 titles, downloadable for free in a .wma format under Windows Media DRM. Alice subscribers will need to extend their contract to twelve months in order to sign up to AliceMusic and will have to renew the service on a monthly basis thereafter, to continue to qualify for free downloads.

EMI executives face losing bonuses

EMI's new owner Terra Firma has told executives at the music group they will receive no bonuses unless the music company hits a £150m underlying earnings target by next June.

Terra Firma are to study artist returns, from international stars such as Robbie Williams [pictured] to breaking stars and local acts
The private equity giant has also imposed a hiring freeze and told EMI to slash its £250m marketing and promotions spend by more than 10pc between now and the end of June.
Terra Firma has also asked EMI to present a sample of around a dozen different artists - from international stars such as Robbie Williams, Coldplay and Norah Jones to breaking stars and local acts - to study which type of artists produce the best returns.
Terra Firma is striving to impose private equity-style management on the company and is working on a strategic review.
Separately, Terra Firma boss Guy Hands has told EMI staff that they should ''not try to be or act like artists themselves" and that Terra Firma plans to display ''leadership" which in the past had been "confused".

EMI's previous bonus scheme ran from March to March, but managers are being set new targets for the year to June. Even if they achieve divisional targets they will get nothing unless the group profit target is achieved.
Sources close to Terra Firma insist that EMI's £150m earnings before interest, tax, depreciation and amortisation (ebitda) target does not relate to the private equity group's banking covenants with Citigroup, which loaned £2.5bn towards its surprise acquisition of the company this summer.
In the year to March 31, 2007 EMI saw ebitda slump from £276m to £174m on revenues down 16pc at £1.75bn. However, Terra Firma is comfortable it can beat £150m, helped by its clampdown on costs.
The cuts in marketing spend are expected to target parties and other discretionary spending.
Terra Firma has parachuted approximately 45 people into EMI to help its review but has imposed a ban on replacing any leavers unless exceptional cases can be made.
It is also clamping down on overshipping. It is understood that EMI had 65m unsold CDs returned to it by retailers last year at a cost of about £1.50 per unit, almost £100m in total.
In the letter to his staff, Mr Hands writes that Terra Firma is ''driving value-added changes" in several ways. These include: ''Making the people in the business understand what it is they are supposed to be doing, that is, that they are there to serve the customer and the artist and not to try and be or act like artists themselves; and changing the culture and displaying leadership where previously there was little and, what little there was, was confused."

Thursday, December 6, 2007

BurnLounge- the community powered digital music service

BurnLounge provides music fans with the necessary software and an expansive catalog of music, to create and sell music (and fan merchandise) to peers from their own digital music stores. This consumer-driven retailing model draws on the power of peer relationships and shared interests of its seller’s communities. After purchasing the software, participating sellers can sign up as “fans” for free and redeem their BurnReward points for products, services or music downloads on BurnLounge. Affiliates pay an additional $6.95 per month but can redeem BurnRewards points for cash. Music Mogul have to pay a one-time set-up fee off $215 and $14.95 per month to gain access to Business Management features, which allows them to build teams.

Ad-supported free music downloads [TrendCentral]

May 25, 2007
Free Music by We7
While the terms “free” and “legal” aren’t usually used together to describe the business of music downloading, a new platform called We7 has developed a system that does just that. Currently in beta, We7 gives brands the chance to communicate with users by "grafting” a short (around 10 seconds) audio or video ad to the front end of the file. Custom tailored to each user through demographics and preferences supplied by the user, these ads in turn provide revenue to the artists. And after about four weeks, users are given the option to have the track ad-free. Users can play their DRM-free files on any device, and can share these files via We7 with whomever they’d like.

Jango: Social Internet Radio [Cool Hunting]

Cool Hunting: Imagine an online social network that provides free, on-demand online music but without the legal anxiety of peer-to-peer networks. More interactive than conventional internet radio, though not as gratifying as Napster was in its glory days, Jango is a New York City-based music site with a large database of songs and artists and is instantly addictive.
Now in its beta launch, there's a waiting list for new members though the first 100 readers to click this link can join. If you don't make the cut, not to worry. The site maintains a waiting list and it should only take a couple of days for an account to get activated. Once you're in, you can invite three of your friends.
The interface couldn't be more simple. Simply type in a musical artist you like and the site will play their songs. You can also specify how broad your tastes are by setting it to play only the artists you have identified or you can opt to hear artists it considers to be in the same genre. This isn't risk free. After adding a few classic rock bands the site began playing The Eagle's "Hotel California." Luckily by clicking on the frowning face icon, I was able to banish that song from ever playing again. Conversely, you can tag songs you like and the site will make sure to keep them in the mix.

New Business Ideas: Cell Phone 2.0

New record label MMS & Buy is launching a service that enables music fans to get information about music, simply by taking a photo of the CD case and sending it via MMS (multimedia messaging) to their server. In an instant you’ll receive ringtones, video clips, concert tickets and further information about your favourite music artists.

Bands want slice of profit from resold gig tickets

Radiohead, Robbie Williams and Arctic Monkeys joined calls yesterday for a levy to be added to tickets resold on the web to allow musicians to claw back some of the profits made by touts and fans.
The acts' managers, together with about 400 other artists, including KT Tunstall and the Verve, said the move was vital to bring some regulation and rigour to a market they described as "the wild west".
They proposed the creation of a Resale Rights Society, which would collect a fee from each ticket sold on eBay and other websites such as Seatwave, Viagogo and that have sprung up to satisfy the demand to trade concert tickets
They said the levy would help to ensure that money raised from the boom in live music flowed back into the industry rather than the pockets of venture capitalists.
With the increased demand for tickets, resale values have soared, fuelling a sizeable secondary market. According to the information service Tixdaq, the market is already worth around £200m a year in the UK. In October, £2m was spent on tickets for the Spice Girls alone.
Marc Marot, chairman-elect of the RRS and the former chief executive of Island Records, said the levy proposal was a "grown-up solution" to a "completely unregulated area".
"The secondary ticketing market offers benefits to music fans and the live music industry alike. It does not make sense to try and criminalise it," he said. "On the other hand there are real issues of consumer protection here. It is unacceptable that not a penny of the £200m in transactions generated by the resale of concert tickets in the UK is returned to investors in the live music industry."
Marot said the move was not intended to boost the bank balances of big names such as Mick Jagger and Sting but to help new artists who increasingly make less money from recorded music sales and rely on income from gigs to make a living.
As record sales have plummeted, the live scene has boomed in recent years with new artists and reformed supergroups playing to wider demographics in better quality venues. A Mintel report in July said the market was worth £743m a year.
But ticket websites have criticised the proposal, insisting they provide a legitimate service that merely reflects the market value of tickets and claiming that the new levy amounted to a tax on consumers.
Eric Baker, chief executive of Viagogo, said: "We don't understand the concept of taxing fans to buy tickets that have already been paid for.
"That someone who bought a Robbie Williams ticket should pay an additional tax to Robbie Williams if they resell the ticket is completely nonsensical.
"If I sell my Ford car, and have already paid for it, I don't have to pay Ford again when I sell it.
"A lot of people sell their tickets because they can no longer make the concert but wouldn't get a refund. So why should they pay for that?" Once a ticket had been bought, he added, its holder should be allowed to do what they wanted with it.
Joe Cohen, the founder and CEO of Seatwave, said his company had invested millions of pounds in building a "safe and transparent place for fans to buy and sell tickets" and would not welcome the creation of the RRS. "This is just a bunch of pigs at the trough," he said. "They see some money and they want it. Our focus is to bring prices down in the secondary market and all this does is raise prices for consumers while adding no value at all."
An eBay spokesperson said it would examine the detail of the proposals, adding that the majority of ticket sellers were genuine fans who could not make the gig. "We would question why a consumer should need a licence to resell a ticket that they have already paid for, particularly when in the overwhelming majority of cases they are denied a refund if they can't go. People are already concerned about the booking fees they pay in the primary market and it is not clear why they would be willing to pay even more to event promoters."
But Marot said RRS-affiliated sites would provide protection to buyers if tickets were fake or missold, or if concerts were cancelled, which was currently only offered by a small proportion of the estimated 240 exchange sites.
He said websites signing up to the plans would be obliged to offer such guarantees and if an artist opted out of having their tickets resold, they would have to respect their wishes.
Participating websites would be awarded a kitemark and receive the backing of artists, promoters and management in promoting the sites. But they would refuse to cooperate with those who didn't and would also examine several avenues for possible legal action. The group is also believed to be in discussions with ticketing giants such as Ticketmaster about helping them launch RRS-endorsed secondary ticketing sites.
The culture, media and sport select committee is due to deliver its report on secondary ticketing in the coming weeks. Detailed negotiations over the size of the proposed levy will begin in the new year.
Explainer: The eBay factor
The rise of eBay as a ticket touts' dream was perhaps inevitable: the auction site now has an estimated 14.5 million users in the UK and more than 10m listings at any one time.
Counterfeiters and ticket touts can reach a larger audience than ever before and you can be sure that whenever a big event is looming, eBay will be loaded with tickets for sale.
That is why event organisers are coming up with increasingly inventive ways to try to beat the ticket resellers.
The over-subscribed Glastonbury festival targeted eBay users as part of its crackdown last summer.
Even though "tout-proof" tickets included images of the buyers, some were up for auction on the site to "bidders with a strong resemblance". Glastonbury organisers matched bidders with details given in the ticket registration process, asked them to withdraw their bids and said they would not be admitted to the festival.
Yesterday, eBay was listing pages of tickets for the Spice Girls reunion tour in January, most asking upwards of £100 for tickets that cost £55-£75. Led Zeppelin's one-off reunion next week is even more in demand; tickets that were originally sold for £125 through a lottery draw are now on offer for up to £1,000, though organisers are insisting that fans won't be allowed into the gig if the ticket holder's name doesn't match the card that paid for the ticket.
eBay has made few concessions to event organisers, pointing out that reselling tickets is not illegal and saying that under the terms of the site, sellers are required to list the original ticket value. But the site was forced to back down in June 2005 when free tickets for the Live 8 concert started appearing on the site. Organiser Bob Geldof and then creative industries minister, James Purnell, both publicly condemned the sales, forcing eBay to relent and remove tickets from the site.Jemima Kiss and Mark Sweney,,2222013,00.html

Wednesday, December 5, 2007

Pepsi To Give Away 1B Songs; Sony to Drop DRM?

Amazon and Pepsi are gearing up to give away 1 billion digital songs in a year-long "bottle-cap" promotion starting next February, Billboard's Ed Christman reports. (That's a lot of songs: For context, Apple has only sold 3 billion songs since 2003, and 1 billion in the first six months of this year). More interesting is Ed's assertion that the giveaway, coupled with Wal-Mart online's insistence that record labels only provide it with music in MP3 format, has Sony-BMG (SNE) thinking about ditching DRM/copy protection for its downloads.Sony has been the most dogmatic in its public proclamations about hanging on to DRM and copy protection, so it'd be a real surprise to see them drop DRM altogether. Ed says the label "is now considering an MP3 test," but doesn't provide much more detail...
He does offer a lot of details about the billion-song promotion though: It's supposed to kick off during the Super Bowl, and is a repeat of a 2004 stunt where Pepsi (PEP) offered to give away up to 100 million tracks. The big difference: The first promotion used Apple's (AAPL) iTunes store as the retail outlet, and this time it's going through Amazon (AMZN), which sells DRM-free tracks that can be used on any software or player.

Napster: Needs A New Business Model -subsciptions don't work

Napster's 2Q highlights: Revenues are up 24% y/y, to $31.6 million, and the company has stopped burning cash. The lowlights: It's no longer burning money because it's retreating from its core business: Selling all-you-can-eat music subscriptions. A year ago the company spent $8.5 million on sales and marketing, and this quarter that number had shrunk to $5 million.The results: six months ago the subscription music service had 830,000 subs, three months ago it had 770,000, and now it has 750,000. The company says that last drop was expected, because kids stop using the service during the summer. But it's not as if those numbers will swell this fall: NAPS projects only a 4% revenue increase for next quarter. So instead of talking up its core subscription business, Napster is now pinning its hopes on the mobile industry. Music on your cellphone may one day be a real business, but hard to see why Napster is going to be the company that will capitalize on it. In the meantime, Napster has concluded that PC-based music subscriptions aren't a growth business -- the same conclusion that Yahoo! Music, RealNetworks and MTV have already come to.

Songwriters Assn. Pushes For 'Piracy' Fee

The Songwriters Association of Canada is pushing forward with a proposal to charge Canadian Internet and wireless users $5 per month to compensate for losses due to file sharing. "We propose an amendment to the Copyright Act which would establish a new right: The Right to Equitable Remuneration for Music File Sharing," the organization wrote in a press release. The Songwriters Association is a lobbying and educational organization based in Toronto. The organization says it is proposing a $5 fee that would "remove the stigma of illegality from file sharing.""In addition, it would represent excellent value to the consumer, since this fee would grant access to the majority of the world's repertoire of music," the organization said. The proposal comes at a time when many critics of the music industry have suggested touring and merchandising revenue can replace lost income from deteriorating CD sales. "I wholeheartedly believe that this model for file sharing should be embraced in all countries," said former Guess Who guitarist and BTO frontman Randy Bachman in a statement posted on the CAB site. "I fully support this proposal and if I can help to get it accepted and made legal, please let me know."However, songwriting and publishing associations have been critical of this position, pointing out that many of those they represent only write music and do not perform live. Based on the CAB's proposal, and a Yankee Group study that predicted 7 million residential Internet users at the start of 2007, approximately $420 million in annual revenue would be generated through the fee. "This would present a major financial improvement for the music industry," the CAB wrote. "Since the license fee would be paid by all internet and wireless accounts, the amount of income generated annually could adequately compensate the industry for years of declining sales and lost revenues, and would dramatically enhance current legal digital music income."

Layoffs Continue At Island Def Jam

Staffing cuts continue at Universal Music Group’s Island Def Jam division. A&R representatives Paul Pontius and Rob Stevenson have exited, following last week’s departure of executive VP of promotion Greg Thompson. Additionally, the staff of imprint Stolen Transmission, which was co-founded by Stevenson and blogger Sarah Lewitinn, was also let go. In total, ten staffers have been cut to this point.Via her personal blog, Lewitinn has stated that she plans to continue running Stolen Transmission as an indie.

New interactive floor-in Dutch language

Nieuw voor evenementen of beurzen : de interactieve vloer
05-12-2007 - De Eyestep is hét nieuwe interactieve mediaconcept dat Tripitch Mediacreatives nog dit jaar introduceert. Eyestep maakt het mogelijk om persoonlijke beweging en interactieve software op een unieke manier te combineren.
Het systeem herkent beweging van mensen en reageert direct met een animatie. Niet alleen de ‘gebruiker’ wordt verrast, maar ook voorbijgangers staan vol bewondering naar de vloer te kijken. Ook de (winkel)vloer wordt nu interactief!
Consumenten kunnen op evenementen, beurzen of in de winkel kennis maken met de interactieve vloer. De EyeStep tovert iedere vloer om in een spannende, interactieve plaats vol actie en fun. Het unieke van dit concept is dat de consument zonder enige inspanning direct in contact komt met het belevingsmedium en het merk.

More Facebook Music Rumors

Is Facebook finally going to take on MySpace as a place for bands and music fans to hang out? We’ve heard various Facebook Music rumors before. The latest one comes from CO-ED (so you know it’s got to be true!).

According to CO-ED’s executive editor Stephen Gebhardt, who says he heard it from a group of marketing managers at a major music label, Facebook has been holding secret meetings with all the music labels and will announce Facebook Music next week at New York’s ad:tech conference (where it is also expected to announce its social ad network).

Here are the details Gebhardt was able to gather: Facebook Music will essentially be a way for musicians (or their labels) to create their own fan pages just like on MySpace, each with a separate sub-domain within Facebook. Facebook members will be able to join any artist’s network as a “fan.” This will be similar to joining a group, but centered around music. Members will be able to listen to streamed songs, watch videos, add music to their own pages, find out about upcoming tours, and meet other fans. Facebook is also supposedly working on sales widgets for these pages (to be introduced at a later date) so that artists can sell downloads directly through Facebook. (Watch out iTunes).

MySpace, Apple, Google . . . who will Facebook pick a fight with next?

The Record Industry's Decline

This is the first part of a two-part series on the decline of the record industry. Today we're including Brian Hiatt and Evan Serpick's report on where the music business went wrong, from the current issue of Rolling Stone, as well as an interactive graphic illustrating the industry's slide. Tomorrow, check back with for interviews with industry leaders on the future of the music business.

Sales figures courtesy of Nielsen SoundScan
For the music industry, it was a rare bit of good news: Linkin Park's new album sold 623,000 copies in its first week this May -- the strongest debut of the year. But it wasn't nearly enough. That same month, the band's record company, Warner Music Group, announced that it would lay off 400 people, and its stock price lingered at fifty-eight percent of its peak from last June.
Overall CD sales have plummeted sixteen percent for the year so far -- and that's after seven years of near-constant erosion. In the face of widespread piracy, consumers' growing preference for low-profit-margin digital singles over albums, and other woes, the record business has plunged into a historic decline.

The major labels are struggling to reinvent their business models, even as some wonder whether it's too late. "The record business is over," says music attorney Peter Paterno, who represents Metallica and Dr. Dre. "The labels have wonderful assets -- they just can't make any money off them." One senior music-industry source who requested anonymity went further: "Here we have a business that's dying. There won't be any major labels pretty soon."
In 2000, U.S. consumers bought 785.1 million albums; last year, they bought 588.2 million (a figure that includes both CDs and downloaded albums), according to Nielsen SoundScan. In 2000, the ten top-selling albums in the U.S. sold a combined 60 million copies; in 2006, the top ten sold just 25 million. Digital sales are growing -- fans bought 582 million digital singles last year, up sixty-five percent from 2005, and purchased $600 million worth of ringtones -- but the new revenue sources aren't making up for the shortfall.

More than 5,000 record-company employees have been laid off since 2000. The number of major labels dropped from five to four when Sony Music Entertainment and BMG Entertainment merged in 2004 -- and two of the remaining companies, EMI and Warner, have flirted with their own merger for years.
About 2,700 record stores have closed across the country since 2003, according to the research group Almighty Institute of Music Retail. Last year the eighty-nine-store Tower Records chain, which represented 2.5 percent of overall retail sales, went out of business, and Musicland, which operated more than 800 stores under the Sam Goody brand, among others, filed for bankruptcy. Around sixty-five percent of all music sales now take place in big-box stores such as Wal-Mart and Best Buy, which carry fewer titles than specialty stores and put less effort behind promoting new artists.

Just a few years ago, many industry executives thought their problems could be solved by bigger hits. "There wasn't anything a good hit couldn't fix for these guys," says a source who worked closely with top executives earlier this decade. "They felt like things were bad and getting worse, but I'm not sure they had the bandwidth to figure out how to fix it. Now, very few of those people are still heads of the companies."

More record executives now seem to understand that their problems are structural: The Internet appears to be the most consequential technological shift for the business of selling music since the 1920s, when phonograph records replaced sheet music as the industry's profit center. "We have to collectively understand that times have changed," says Lyor Cohen, CEO of Warner Music Group USA. In June, Warner announced a deal with the Web site that will allow consumers to stream much of its catalog for free, in hopes that they will then pay for downloads. It's the latest of recent major-label moves that would have been unthinkable a few years back:

In May, one of the four majors, EMI, began allowing the iTunes Music Store to sell its catalog without the copy protection that labels have insisted upon for years.
When YouTube started showing music videos without permission, all four of the labels made licensing deals instead of suing for copyright violations.
To the dismay of some artists and managers, labels are insisting on deals for many artists in which the companies get a portion of touring, merchandising, product sponsorships and other non-recorded-music sources of income.

So who killed the record industry as we knew it? "The record companies have created this situation themselves," says Simon Wright, CEO of Virgin Entertainment Group, which operates Virgin Megastores. While there are factors outside of the labels' control -- from the rise of the Internet to the popularity of video games and DVDs -- many in the industry see the last seven years as a series of botched opportunities. And among the biggest, they say, was the labels' failure to address online piracy at the beginning by making peace with the first file-sharing service, Napster. "They left billions and billions of dollars on the table by suing Napster -- that was the moment that the labels killed themselves," says Jeff Kwatinetz, CEO of management company the Firm. "The record business had an unbelievable opportunity there. They were all using the same service. It was as if everybody was listening to the same radio station. Then Napster shut down, and all those 30 or 40 million people went to other [file-sharing services]."
It all could have been different: Seven years ago, the music industry's top executives gathered for secret talks with Napster CEO Hank Barry. At a July 15th, 2000, meeting, the execs -- including the CEO of Universal's parent company, Edgar Bronfman Jr.; Sony Corp. head Nobuyuki Idei; and Bertelsmann chief Thomas Middelhof -- sat in a hotel in Sun Valley, Idaho, with Barry and told him that they wanted to strike licensing deals with Napster. "Mr. Idei started the meeting," recalls Barry, now a director in the law firm Howard Rice. "He was talking about how Napster was something the customers wanted."

The idea was to let Napster's 38 million users keep downloading for a monthly subscription fee -- roughly $10 -- with revenues split between the service and the labels. But ultimately, despite a public offer of $1 billion from Napster, the companies never reached a settlement. "The record companies needed to jump off a cliff, and they couldn't bring themselves to jump," says Hilary Rosen, who was then CEO of the Recording Industry Association of America. "A lot of people say, 'The labels were dinosaurs and idiots, and what was the matter with them?' But they had retailers telling them, 'You better not sell anything online cheaper than in a store,' and they had artists saying, 'Don't screw up my Wal-Mart sales.' " Adds Jim Guerinot, who manages Nine Inch Nails and Gwen Stefani, "Innovation meant cannibalizing their core business."

Even worse, the record companies waited almost two years after Napster's July 2nd, 2001, shutdown before licensing a user-friendly legal alternative to unauthorized file-sharing services: Apple's iTunes Music Store, which launched in the spring of 2003. Before that, labels started their own subscription services: PressPlay, which initially offered only Sony, Universal and EMI music, and MusicNet, which had only EMI, Warner and BMG music. The services failed. They were expensive, allowed little or no CD burning and didn't work with many MP3 players then on the market.

Rosen and others see that 2001-03 period as disastrous for the business. "That's when we lost the users," Rosen says. "Peer-to-peer took hold. That's when we went from music having real value in people's minds to music having no economic value, just emotional value."
In the fall of 2003, the RIAA filed its first copyright-infringement lawsuits against file sharers. They've since sued more than 20,000 music fans. The RIAA maintains that the lawsuits are meant to spread the word that unauthorized downloading can have consequences. "It isn't being done on a punitive basis," says RIAA CEO Mitch Bainwol. But file-sharing isn't going away -- there was a 4.4 percent increase in the number of peer-to-peer users in 2006, with about a billion tracks downloaded illegally per month, according to research group BigChampagne.
Despite the industry's woes, people are listening to at least as much music as ever. Consumers have bought more than 100 million iPods since their November 2001 introduction, and the touring business is thriving, earning a record $437 million last year. And according to research organization NPD Group, listenership to recorded music -- whether from CDs, downloads, video games, satellite radio, terrestrial radio, online streams or other sources -- has increased since 2002. The problem the business faces is how to turn that interest into money. "How is it that the people that make the product of music are going bankrupt, while the use of the product is skyrocketing?" asks the Firm's Kwatinetz. "The model is wrong."

Kwatinetz sees other, leaner kinds of companies -- from management firms like his own, which now doubles as a record label, to outsiders such as Starbucks -- stepping in. Paul McCartney recently abandoned his longtime relationship with EMI Records to sign with Starbucks' fledgling Hear Music. Video-game giant Electronic Arts also started a label, exploiting the promotional value of its games, and the newly revived CBS Records will sell music featured in CBS TV shows.
Licensing music to video games, movies, TV shows and online subscription services is becoming an increasing source of revenue."We expect to be a brand licensing organization," says Cohen of Warner, which in May started a new division, Den of Thieves, devoted to producing TV shows and other video content from its music properties. And the record companies are looking to increase their takes in the booming music publishing business, which collects songwriting royalties from radio play and other sources. The performance-rights organization ASCAP reported a record $785 million in revenue in 2006, a five percent increase from 2005. Revenues are up "across the board," according to Martin Bandier, CEO of Sony/ATV Music Publishing, which controls the Beatles' publishing. "Music publishing will become a more important part of the business," he says. "If I worked for a record company, I'd be pulling my hair out. The recorded-music business is in total confusion, looking for a way out."

Nearly every corner of the record industry is feeling the pain. "A great American sector has been damaged enormously," says the RIAA's Bainwol, who blames piracy, "from songwriters to backup musicians to people who work at labels. The number of bands signed to labels has been compromised in a pretty severe fashion, roughly a third."

Times are hard for record-company employees. "People feel threatened," says Rosen. "Their friends are getting laid off left and right." Adam Shore, general manager of the then-Atlantic Records-affiliated Vice Records, told Rolling Stone in January that his colleagues are having an "existential crisis." "We have great records, but we're less sure than ever that people are going to buy them," he says. "There's a sense around here of losing faith."