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Thursday, January 13, 2011

The Beginning Of The Death Of MySpace

Yesterday MySpace laid off about 500 people worldwide, or about 47% of its entire staff. MySpace has been on a downward spiral since purchased by NewsCorp in 2005, mostly for not acknowledging what it was and focusing on what it wasn't instead.

At it's core, MySpace was an entertainment site centered around music. It didn't do that well enough to maintain it's audience, since instead of improving its core value, it choose to try to be more of a general social network. However, that failed miserably with Facebook coming from nowhere to dwarf its huge initial lead in both visitors and revenue.

The sad part is, there's still no obvious successor for music, as Facebook still lacks many of the core assets that MySpace offers, despite some of the available music apps like RootMusic.

What's more, MySpace still has more than 80 million visitors per month, although that looks to be declining by between 5 and 10% a month.

MySpace held such promise, and delivered little of it. It's another example of a multinational company getting involved in the music business only to slowly run it into the ground. History repeats itself again.

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You should follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.


Wednesday, January 12, 2011

Social Distortion Allows You To Control The Price

Hard Times and Nursery RhymesPunk band Social Distortion has found a new twist on allowing their fans to control the pricing of their next album. For every 100,000 streams of songs from their album Hard Times And Nursery Rhymes, the price drops a dollar on the sales price when the album is released on Amazon on January 18. There's a bit of exclusivity in the deal in that it only applies to Amazon sales in the US>

The band uses the following scale:

0  streams - $12.99
100k streams - $11.99
200k streams - $10.99
300k streams - $9.99
400k streams - $8.99
500k streams - $7.99

The band is also offering a price guarantee, meaning that whatever price you pay for the preorder, you'll end up paying only the amount that the price ends up at on January 18 after all the streams are counted.

Unfortunately, they're only sold a bit above 100,000 with about a week to go, so the discount is limited, but you've got to hand it to them for thinking out of the box in terms of pricing and promotion. Then again, they've gotten more than 128,000 paid downloads even before the album came out, which is a pretty effective variable pricing promotion after all.

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You should follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.

Winners Of The Music Producer's Handbook Giveaway

Raul Silva and Craig Green are the winners of the Music Producer's Handbook giveaway.

Thanks to everyone that participated. There's a new giveaway coming soon!

Even though you can't win this one, you can still sign up for my newsletter.

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You should follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.


Tuesday, January 11, 2011

UltraViolet Tries To Prove That Physical Product Isn't Dead Yet

If you thought that those shiny plastic discs that used to be so popular are over, think again. While it may be true that CDs and DVDs have seen their best days, Blu-ray discs have something up their sleeves that might give some new life to those round pieces of plastic.

The latest variation is called UltraViolet and it's an idea that actually brings several technologies, both old and new, together. The basis of UltraViolet is that it's a data locker in the cloud for the content that you've purchased, but it goes a bit further.

If you buy a Blu-ray disc of a movie or game, it gives you the enduring right for you or your family to access that content from the cloud on any Blu-ray device that you might have. But even better, the idea is that you only have to purchase that product once, and it's always available to you, even if a new higher resolution format is created at a later date. The physical Blu-ray disc that you purchased is used only a backup and a point-of-purchase device to give you some feel of tactile product ownership.

Every hardware, computer, software company and movie studio except for Apple and Disney has signed on to the UltraViolet program. Of course, they have their own competing content locker strategy that we'll see soon enough, so it should be an interesting battle for market share. My guess is that Apple will win this battle, but it's certainly too early to tell.

UltraViolet will be introduced in July. Read more about it on the UVVU.com site here.

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You should follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.


Monday, January 10, 2011

What The Beatles Unique iTunes Deal Means For Other Artists

It's recently been revealed that The Beatles/EMI deal with iTunes has a very unique feature. iTunes pays all royalties directly to both The Beatles Apple Corps and their publishing company Sony/ATV Music Publishing, bypassing EMI.

This type of payment arrangement is normally never done. The record label normally gets the payment from iTunes, then distributes the money to the artist and the publisher. By being paid directly, The Beatles made sure of a couple of things.

1) There'd be no hanky panky with the books by EMI.

2) They don't have to wait until the end of EMI's payment cycle to get paid.

But wait. There is one case where an artist is paid directly by a distributor (which is what iTunes is) and that's in a licensing deal. What's the difference? In a record deal, the record label manufactures the product. In a licensing deal, another entity is given the right to take on the burden of manufacturing from a duplicated master, but the royalty rate to the artist is then increased to as much as 50% (up from 12 to 25% on a record deal, depending upon the contract). But if EMI isn't manufacturing any product (because it's digital) and iTunes is the distributor of duplicated master, isn't that a license?

There's been a number of artists that have been arguing this is the case for the last couple of years. As I reported here, Eminem's production company F.B.T. lost its first court battle with UMG then won the appeal, but UMG has asked the court to review the decision, so the result isn't as cut and dried as it initially seemed. Cheap Trick and the Allman Brothers have also taken their labels to court for just the same issue. Cheap Trick eventually settled the case with Sony Music, but the Allman Brothers case is still continuing.

While EMI vehemently denies that the deal with iTunes is not a licensing deal, if it looks and sounds like a duck, it probably is a duck, and that sets a precedent. While you have to have some hits to play in this league, the fact that EMI agreed to such a deal (probably because they just wanted to get some revenue through the door) may ultimately cause the courts to rule against other labels the next time this situation comes up.

That doesn't mean that all artists will ultimately benefit from The Beatles/EMI/iTunes deal, but it does bring it into the realm of possibility. And once the ball starts rolling downhill, it only picks up speed.

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You should follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.

Sunday, January 9, 2011

2010 Music Sales Down

This isn't any great revelation, but music sales were down again in 2010. According to Nielsen SoundScan, album sales were down 13%, although that still amounts to 376 million units (which is still a whole lot). Of those, a full 33% were sold by big box stores like Wal Mart and Target. Only 8% were sold by indie record stores.

The most ominous sign however, is that total music sales fell by 2.5% from 2009. Even digital sales were somewhat stagnant as they inched up by only 1% over the previous year (which amounted to 1.17 billion downloads). As a comparison, 2009 was up 8% over 2008, and 2008 was up a whopping 27% over 2007.

So why has digital music's growth slowed? It's entirely possible that it's because the increasing use of free streaming sources like YouTube and Pandora to listen to music. If that's the case, it sets the stage for the age of subscription music, as consumers become more comfortable with streaming instead of owning. The music industry has hungered for subscription music, and this may be the year that it finally becomes more widely adopted.

That being said, a big part of subscription appears to depend upon whether the European Spotify service launches in the States. Spotify is still having a problem obtaining licensing agreements from the major labels, and some doubt if that will ever happen, and that prevents it appearing in the US. Of course, the moment iTunes offers subscription (and there's no indication this is imminent), so goes the music world.

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You should follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.


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