Tag Archives: media

Indie Music Agency Merlin: iTunes Remains Biggest Digital Destination; Spotify And Amazon 2nd And 3rd; Streaming Still Just An Opening Act

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On the heels of Google wading into the music streaming waters with its Google Play Music All Access service, with a $10 fee for all-you-can-eat streamed tracks, the indie music agency Merlin has today published some results of a recent survey of its 20,000-label member group, plus an analysis of 6.5 billion music streams over the last year, which spell out where the money is coming from today. It notes that streaming services are making increasing headway as a revenue driver for musicians, but that digital downloads — specifically Apple’s iTunes — are still ruling the roost.

Worldwide, iTunes has held on to its spot as the single-biggest source of revenues for Merlin’s independent label members, both across key markets like the U.S. and UK, as well across Europe and globally. Interestingly, Spotify is securely in second position, underscoring just how popular both Spotify and streaming services  have become — second has been a place held by Amazon for some time prior to this. Amazon’s MP3 download service subsequently slipped down to third place across the board, while Deezer and eMusic are split regionally in terms of their influence and in grabbing fourth place.

We’re reaching out to Merlin to see if we can get a specific percentage breakdown here. Typically iTunes has been estimated to hold around 60% of the digital music market by revenues. (Update: A Merlin spokesperson says those breakdowns are not being disclosed.)

“The new generation of digital services has created a new dynamic of consumer freedom, limitless choice and myriad paths to discovery,” Charles Caldas, the chief executive of Merlin, said today in a speech at the Great Escape conference in Brighton. “Our numbers illustrate that this dynamic is bringing incremental value to the market, and the demand from music fans for the music being released by our independent members is higher than ever before.” However, in what might be a swipe not just at big labels but big players like Google jumping deeper into the market, he also cautioned against companies that might be trying to apply legacy music royalty concepts to digital.

“The ecosystem is fragile: power is more concentrated than ever, and we are seeing an attempted land grab by the largest companies for digital market share as they try to recreate the old-market advantages they are clearly losing in the digital space,” he noted.

It will be interesting to see whether Spotify’s (and streaming’s) rise are eating into that 60% marketshare for iTunes. But the research from Merlin suggests that if this is the case it’s not a watershed moment quite yet: both formats appear to still be growing, even if streaming is growing more.

Some 92% of respondents in the survey said that streaming and subscription revenues (based on streaming) grew in 2012 compared to a year ago. One-third said the rise was as much as 100%.

The rise in downloads was less pronounced: around 66% said a-la-carte download sales grew alongside that streaming rise. Only 8.4% said the rise in download revenues increased by 100%.

In terms of what the growth in streaming means for actual businesses, the takeaway is still marginal.

Merlin’s members say that they expect royalties of $65 million or more for 2013 from streaming services, but if you just do the math and divide that among 20,000 members, that works out to only $3,250 per label. Considering that Merlin claims that its members’ share of streaming services is typically 12-20% higher than those of other major labels — included in Merlin’s counts are acts like The National, Grizzly Bear and Bon Iver, as well as labels like Domino and Beggars Group — it sounds like streaming, despite all the advances and popularity, remains for now just an opening act, and not the main event.

Full results of the report below.

A Q&A With the Real-Life Maker of ‘Arrested Development’s’ Bluth’s Frozen Bananas

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To coincide with the release of Season 4 of “Arrested Development” on May 26, the Bluth’s Original Frozen Banana Stand is popping up in locations around New York and London. But these frozen bananas aren’t being hand-dipped by George-Michael. They’re made by Chuck Pheterson, the founder and president of Florida-based Totally Bananas, a man who hadn’t watched a single episode of the show when he started the company in 2009 and didn’t even realize his frozen bananas were the frozen bananas being handed out to “Arrested Development” fans this week – until I e-mailed him to set up the following interview. How did you get involved with the Netflix plan to offer frozen bananas at the replica Bluth’s Frozen Banana Stand? We sell through distribution channels, so for the most part, we don’t know where our product ends up. We started sending our product out last week, and another order this week for a total of about 14,000 bananas. We knew it was Netflix, but we didn’t really know what this was all about. Wait. So you didn’t know this was for the Bluth Booth? When I got your e-mail, we looked at it and said, holy moly! That’s when I found out. I thought this was a Netflix party. (WATCH: TIME on the Scene at ‘Arrested Development’s’ Bluth’s Banana Stand) That would be quite the party. We have companies that buy thousands of bananas. So this wasn’t an unusual order for you guys. That’s mostly what we do. We supply all the Niagara Falls concessions on the Canadian side. We have products at CVS, at Shell stations throughout the state of Florida. Major zoos like the Bronx Zoo or the Audubon Zoo in New Orleans order from us. For me, this was just another order that I thought was for a company party. In our e-mail exchange, you said your phone was ringing off the hook. Do you now think it was related to Netflix and you didn’t realize it? Now, yeah. When we found out, we started sending out

Google’s Reportedly Launching A Music-Streaming Spotify Killer At I/O This Week

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Google is ramping up to deliver a streaming music service, which could debut as early as tomorrow at the I/O keynote, sources have told The Verge. The report has since been picked up by other publications, including The New York Times, which confirms that this is indeed the case according to its own unnamed sources, “people briefed on the plans.”

That Google would be working on a streaming, Spotify-style music service should surprise exactly no one. It’s been the elephant in the room among the major purveyors of digital music, including Apple, Amazon and Google ever since Spotify and competitors like Rdio emerged and started picking up steam and adding users.

Neither Spotify nor Rdio have come anywhere close to unseating the big guys in terms of users or music revenues, but that doesn’t mean that Apple and Google haven’t noticed the growing trend towards streaming. Juniper Research said recently that streamed music revenues will grow by more than 40 percent in 2013, rising to $1.7 billion by the end of the year. That’s still peanuts compared to the revenue Apple alone drives from iTunes music sales each year (it paid out $3.4 billion to record labels in 2012, which is after it takes its own cut).

The Google streaming service has been in development for a while now, according to rumors, but negotiations have now progressed to the point where it’s ready to launch, with all three major record labels signed up. There won’t be a free option, says the NYT, but instead there will be a paid subscription available at or around the going rate at competing services, or roughly $10 per month.

If true, this means Google’s negotiations with streaming services have progressed far faster and further than Apple’s, which reportedly hit a snag earlier this week. Both Apple and Google had previously raced to introduce cloud-based digital locker services for Google music, which allowed people to access tracks they’d previously purchased remotely from a variety of devices rather than stream tracks Spotify-style. That seemed like a sure precursor to a true streaming service, but labels were reportedly reluctant to go all-in on that model originally.

The strangest thing about this is that Google is reportedly still doing the YouTube-based streaming music service that had previously made the rounds, in addition to this new one, which will apparently operate alongside it. How these work, especially in terms of what they give users access to and for what cost, should provide an interesting look at how Google is looking at dividing its media business efforts.

We’ll likely find out tomorrow if this Google streaming thing is for real, live at the I/O keynote right here on TechCrunch.

How MTV Decided to Abandon Rebellion

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Not so long ago, reality programs featuring wealthy teens and twenty-somethings — shows like “The Hills” and “Laguna Beach,” both set in affluent California communities — were garnering strong ratings for MTV. By the time Stephen Friedman became the network’s president in 2008, however, viewer tastes were beginning to change. In particular, the 43-year-old Friedman found that these programs simply weren’t resonating with so-called millennials, the generation of Americans born between 1980 and 2000. So Friedman launched an across-the-network reinvention of MTV’s programming, quickly dropping the two shows and replacing them with programs like “Teen Mom,” which became one of MTV’s highest-rated shows during its three-year run and led to “Teen Mom 2;” and “Awkward,” now the network’s longest-running scripted comedy. We recently spoke with Friedman about the kind of programming that appeals to millennials; the reason that he toned down the network’s long-standing ethos of rebellion; and why it suddenly became OK to acknowledge the existence of parents on MTV. You’ve spearheaded a reinvention of MTV to target millennials. How exactly have you changed the network’s programming? When I got the job in 2008, one of the first things I did was partner up with our research department to do a very deep dive into where our audience was. We really wanted to look at this generational shift that was very much in process, and what we found was that our programming was still too focused on Generation X. How so? “The Hills” was an example of a show that was pioneering at the time. It looked unlike any other reality show with its cinematic quality. That show was still very popular, but our audience started questioning, “Is this really reality?” What became clear is that this audience seemed to be looking for something that was much more authentic to their experience. So while there were a lot of fans of a show like “The Hills,” we saw the age range moving up. Our typical average age of a show now is around 21. Then it was much closer to

Norway’s Crown Prince And Princess Talk Startups And Try Out The Oculus Rift

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royal couple norway

Norway’s Crown Prince Haakon and his wife Princess Mette-Marit were in Silicon Valley this week, and I asked them about their hopes to bring more startups and innovation to their home country.

I interviewed Haakon and Mette-Marit at Norway’s Innovation House Silicon Valley, a co-working space in Palo Alto for Norwegian startups looking to enter the US market. The couple saw demos from several startups — the prince even tried on some Oculus Rift virtual reality goggles — it was part of Making View‘s demo of its technology for capturing and exploring 360-degree video footage. (He said it was “pretty awesome.”)

Haakon actually lived in the Bay Area a decade ago, when he was attending UC Berkeley. He told me that he also attended the opening of the Innovation House 18 months earlier — since then, it has been used by more than 25 companies. Norway is “constantly trying to foster a culture of innovation,” he said.

When I asked what kind of relationship they would like to see between Norway and Silicon Valley, Mette-Marit said:

I think it’s important that we have this house as a starting point. But obviously, we also have examples of companies that have been doing very good here before this house came … I think that’s important that you have some companies that have done well and are willing to take on a sort of mentoring role for the other companies coming after.

I didn’t get a chance to go into too much depth with the couple, but I thought it was interesting to see them discussing these issues at all. The video concludes with a short interview and demo of technology from Elliptic Labs, one of the companies at the Innovation House. It’s developing gesture-based controls, sort of like Leap Motion, but designed to integrate with tablets and smartphones.

By the way, you might notice that I usually refer to the crown prince and princess in the third person. That’s because I was told that’s the polite way to address royalty, though I suspect I still messed it up somehow.

Goldman Sachs, JPMorgan say Bloomberg News was spying on their employees

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Goldman Sachs recently confronted Bloomberg LP after learning that reporters for the business news service have been using the company’s terminals to monitor employees of the Wall Street bank, The New York Post reports.

Specifically, Goldman officials learned that Bloomberg staffers could determine not only which of its employees had logged into Bloomberg’s proprietary terminals but also how many times they had used particular functions, sources told The Post.

From The Post:

In one instance, a Bloomberg reporter asked a Goldman executive if a partner at the bank had recently left the firm — noting casually that he hadn’t logged into his Bloomberg terminal in some time, sources added.

The complaints aren’t limited to Goldman. According to a Financial Times report, JPMorgan has brought up similar concerns with Bloomberg. Sources told the Times that JPMorgan was concerned Bloomberg reporters monitored when the bank’s employees logged on when deciding how to cover the “London whale” trading loss last year.

Wall Street firms pay about $20,000 a year to rent each terminal, which provides reams of real-time data about everything from financial transactions to sports to hard news.

A Bloomberg spokesman said that it immediately “decided to disable journalist access to this customer relationship information for all clients.”

Any company that provides an internet service like Bloomberg is going to have reams of data on the activities of clients. But letting journalists (or anyone else) have access to that for their work is a great way to freak out your clients, and make them skeptical about handing over so much money every year. We can only imagine that the bosses on the terminal side of the business are furious at the use of this data by journalists.

YouTube Tiptoes Toward Paywalls With The Launch Of Channel Subscriptions, But The Ads Play On

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While it would take you a million lifetimes to watch all the video on YouTube, the company relies on contributions from its amateur and professional partners to keep its content fresh. At the same time, its core business model revolves around providing advertisers with the ability to reach its billion-plus viewers. In turn, video creators rely (or want to rely) on a piece of that ad revenue to continue producing their content. The problem is, of course, that those ads are intrusive, annoying and, at the end of the day, its partners are finding that the revenue from those banners and clips isn’t growing nearly as fast as, say, the number of cat videos on YouTube.

In an effort to provide its partners with an alternative revenue stream, YouTube announced today that it is officially launching a pilot program that enables its video stars to charge subscription fees for access to their channels. Subscriptions will start at $0.99/month, and every channel will be able to offer a 14-day free trial, along with discounted yearly rates.

In its announcement, YouTube cites Sesame Street, which will offer full episodes through its paid channel, and UFC offering fans the ability to watch classic fights as examples. For more, here’s the list of its 53-odd pilot channels.

As of today, users can subscribe to paid channels from their desktops and laptops and watch across devices, but going forward YouTube will look to add the ability to subscribe from any medium/device. On top of that, YouTube will begin a broader roll out of subscriptions in the next few weeks for “qualifying partners,” and from the looks of it, it will be adding a paid channel recommendation feed — just as it does now for free channels.

If you don’t have a YouTube channel, why should you care? Well, YouTube has been telegraphing this for awhile, but it’s really the first (official) sign that YouTube is beginning to tiptoe into the paid video market. Granted, the subscription model isn’t a new idea for YouTube, considering the company just announced in March that it will be launching a music subscription service later this year.

The goal is much the same: Give musicians/artists/creators an opportunity to make some money, while improving the user experience for listeners by potentially removing some of those obnoxious ads that start every video. Of course, in the case of both video and music, it’s much more likely that YouTube is going to stick with both.

Amateur content creators are going to be hesitant about erecting paywalls around their content. Most viewers are going to balk at the idea of buying a subscription to a YouTube channel, and there’s a question of whether or not they’d really be able to convert enough of their viewers to paid subscriptions to make it worth it. In the end, it’s the same issue newspapers and publishers have struggled with for years.

There’s also the fact that every video producer is already offering their content for free, although behind ads. Now you’re going to tell viewers that they have to pay for the same content they’ve been getting for free? Sure, that will work for your superfans, but as is the way with the “freemium” model, if you’re going to charge, the content behind the paywall better be, well, premium. I want to see “Extras,” exclusive content/footage, and so on.

Of course, as Peter Kafka pointed out this week, amateur video producers likely don’t have the resources to produce that exclusive or premium content.

Nonetheless, the company is going to use paid subscriptions in an attempt to attract new partners, new content creator and, we assume, more dollars — although YouTube doesn’t specify whether it will be taking a cut of subscriptions or not. YouTube is clearly aware of the success Hulu, Netflix, Vimeo and other video sites have been having with subscription and on-demand models, and it wants to become more attractive to film and TV networks, studios and producers.

But for now, YouTube can’t make the jump exclusively to subscriptions, because it needs those ad dollars that are keeping the whole thing afloat. It’s a tricky line to walk, no doubt, but YouTube certainly isn’t helping its user experience by setting up the potential to have both a paywall and ads in and around videos for the foreseeable future.

Just speaking for myself personally, I probably most frequently use YouTube for search (and a little discovery), particularly around music. In other words, I’ll have a song or an artist in mind, will do a YouTube search, which inevitably serves a couple or dozens of choices for the same song, artist or even subject. There’s a high likelihood that I have no idea which video I want or is best, which requires some perusing, so having a 10 second ad at the beginning of each video is really disruptive.

Maybe that’s a niche use case, but I suspect not. YouTube ads, while tolerable because we consciously or subconsciously recognize their role in keeping millions of cat videos afloat and online, are frustrating. Sure, Hulu has ads, too, and they aren’t much better. But at least in Hulu’s case, the viewer knows they’re watching a 30-minute or hour-long episode of television online, and regular old offline TV has already conditioned us to expect ads every 5 seconds. Unfortunately. But for a 2-minute clip of questionable quality? Come on.

So keeping ads, while slowly throwing up paywalls is just a bad idea. So the roll out of paid video will end up being incremental and almost just a show of good faith — to keep from ruffling feathers — while the ads just keep proliferating.

The Charles Ramsey-McDonald’s Episode: How a Viral Marketing Opportunity Can Backfire

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Using a story about women being kidnapped and held against their will for years for marketing purposes is questionable enough. Now that the hero in the story turns out to have a history of domestic violence convictions, the Charles Ramsey-McDonald’s episode is shaping up as an argument that perhaps brands should respond to viral marketing opportunities slowly, cautiously—and sometimes not at all. The accepted wisdom today is that when a brand is suddenly front and center in the news for almost any reason whatsoever, the company must seize the moment and take advantage of the situation as a marketing opportunity. Responding with speed is deemed to be absolutely essential. Oreo, for instance, was widely lauded for its quick-thinking Tweet during the Super Bowl blackout. The Tweet, featuring a photo of the iconic cookie and the caption “You can still dunk in the dark,” was put up in 10 minutes—before the lights were back on at the New Orleans Superdome—and was immediately retweeted and liked on Facebook tens of thousands of times. (MORE: Stealth Celebrity Endorsement: No Money Changes Hands, Just Free Burritos) The Etch a Sketch toy and Sesame Street’s Big Bird both had big moments in the news during last year’s presidential campaign, and Poland Spring bottled water received plenty of attention thanks to Marco Rubio’s “Gulpgate” during the Republican Address to the Nation in February. These odd spectacles were all viewed as prime branding opportunities that fell into the laps of their respective marketing departments—an opportunity that Poland Spring, for one, was criticized for botching. This week, McDonald’s was suddenly, bizarrely in the news in a big way, when a man named Charles Ramsey became a viral sensation. Ramsey is the neighbor who helped rescue three women who had been abducted and held captive for a decade in a home in downtown Cleveland. In interviews that have been shown on TV stations around the world—and viewed millions of times online—Ramsey mentioned that he was “eating my McDonald’s” when he heard screaming, leading him to save a woman trying