Gigmor's David Baird On My Latest Inner Circle Podcast

David Baird of Gigmor

If you ever wanted to replace a player in a band or find a band to join, you know how difficult the process can be. Finding players of the same interests and proficiency levels really complicate things.

David Baird had the same problem when he moved to Los Angles (just about the last place you'd think that would happen), so the savvy technologist built a new platform called Gigmor that allows not only players to connect with each other, but bands and artists with venues as well.

On this week's podcast David will tell us how Gigmor got started and how to get the most from this innovative website.

In the intro, I'll talk about the implications of Pandora buying some of the assets of the Rdio streaming service, and the hi-res music logo that the RIAA just introduced that seems to cause more confusion than it solves.

Remember that you can find the podcast at BobbyOInnerCircle.com, or either on iTunes, Stitcher and now on Mixcloud and Google Play.

---

Any purchases made through our Amazon links help support this blog at no cost to you (just click here).

The Pros And Cons Of Pandora’s Rdio Acquisition

The music streaming wars just became a bit more interesting early this week when Pandora agreed to acquire some critical assets of the Rdio streaming service out of bankruptcy for a reported $75 million. This will the second strategic acquisition that Pandora has pulled off recently, following its $450 million purchase of Ticketfly a few months ago.

On the surface this seems like it could be a huge positive for the company, but there are also a few potential land mines that come with the deal. Let’s look at the pros and cons.

Pro: On-Demand Infrastructure Can Provide Growth
Pandora is acquiring Rdio’s streaming technology (as well as some of its staff), which could be key to its global expansion. Right now the service is only available in the United States, and to a lesser degree, Australia and New Zealand.

A real problem for Pandora until now has been its ability to expand beyond those territories, mostly due to the company not being able to come to a suitable agreement with the licensing organizations in various countries (which all seem to favor on-demand streaming).

The company is now more more likely to be able to grow, as having Rdio’s on-demand streaming infrastructure available as an integral part of the service not only makes for a more attractive package for the consumer, but may make it easier to gain approval to operate in other countries.

Pro: The Public Prefer’s On-Demand
Give Pandora credit, as it saw the writing on the wall that on-demand streaming would eventually become a clear winner with consumers over the radio-like non-interactive service that it currently provides.

This was blatantly evident with Apple’s recent entry into the market with it’s on-demand Apple Music after only offering the Pandora competitor Apple Radio previously. You could see the trend in user numbers as well, as on-demand Spotify’s numbers continue to grow while Pandora’s have been relatively stagnant.

Con: On-Demand Licensing Costs Are Considerable
While that on-demand infrastructure is important, Pandora didn’t inherit any of Rdio’s roughly 1 million customers in deal, mainly because it’s not buying the Rdio business itself. Maybe more importantly, it didn’t get any of its licenses with the record labels, which were non-transferable. That means that the company will need to negotiate these deals, which can be both costly and time-consuming. Read more on Forbes.

---

Any purchases made through our Amazon links help support this blog at no cost to you (just click here).

Gaming The Streaming Networks With Fake Listeners

While most people play by the rules, there's always someone that wants to game the system. It happened on MySpace, YouTube, Facebook, Twitter and just about every other platform, so when a story came out about a programmer who gamed the streaming services, it should be no surprise.

Security consultant Peter Fillmore showed how an automated program called a bot (a software based robot) could generate royalties a few years ago. Fillmore made about $1,000 in royalties and even topped the Australian streaming charts of Rdio by having the bot listen to his own music nonstop. In Fillmore's case, it wasn't about making money as much as it was about showing the various streaming services the potential vulnerability.

Fillmore's music was sampled every 30 seconds for about 6 months, when Spotify finally caught on and took down his album.

In a great article on Motherboard, William Bedell attempted to duplicate Fillmore's method and wound up making approximately $32 a day from Spotify, at about $0.08 per stream, which is at the high end of the Spotify payout.

That being said, while this might be child's play for an experienced hacker, it's beyond the abilities of most musicians who aren't programmers. It involves disguised user bots using virtual private networks and dozens of paid Spotify accounts (see the graphic above). Still, Bedell estimates about a 600% rate of return on the venture.

You can be sure that Spotify and all the other streaming services are taking these approaches very seriously, so by the time you try something like this, it's possible that this hole in their services will be patched.

It does go to show that people will always try to game the system if they can.

---

Any purchases made through our Amazon links help support this blog at no cost to you (just click here).

Spotify Looking To Add Video Streaming

Reports are that Spotify has been reaching out to top YouTube content creators and traditional media companies in an attempt to accrue content for a new streaming video feature. Although no specific date for the launch has been officially announced, many believe it will come by the end of the month.

The feature is said to be free and will take advantage of the existing advertising infrastructure that the company has set up for its streaming music service.

Spotify recently raised another round of investment said to be around $350 million on the basis of a total valuation of $8 billion. Speculation is that the introduction of video played a large part in raising the cash.

While it's difficult to make money with streaming music, video streaming (even if it's free) is another story, as more and more brands expand their advertising in that area. Of course, YouTube hasn't done too badly with that model either.

Another reason why Spotify might be going that route is from pressure brought by other streaming music services like TIDAL and Google Play, which also offer video. That said, Rdio also tried a video feature but abandoned it after 6 months.

Spotify also sees the upcoming competition from both Apple's new music service and from Google's Music Key, and views adding video as the best way weather the storm of their launches. That's also why we'll probably see a Spotify video launch sooner rather than later.

Whether the streaming service's new video feature will actually gain traction is another story.

---

Any purchases made through our Amazon links help support this blog at no cost to you (just click here).

Rdio Goes Free

With Spotify, Pandora, Apple and Google threatening to run away with the streaming music market, some of the smaller services have been forced to make changes in order to keep up. Rdio, which was created by the makers of Skype four years ago, announced recently that it would change from an all-subscription model to a freemium model in order to entice more customers to give the service a try.

No one knows for sure how many users Rdio actually has, but the service is currently available in 60 countries and it's generally admired for its clean design. Its new freemium service will be available in 20 countries to start, and gradually roll out to the others over time.

One of the more interesting things about Rdio is that it's now partially owned by Cumulus Media, which operates 460 radio stations in 89 markets. Advertising for the new Rdio free service will be handled by the Cumulus sales staff, and the service may be allowed to use some of the Cumulus programming in the future.

Rdio's freemium service allows a new user to try the various stations available for free, and for the $9.95 Unlimited package provides additional playlists and add-free playback. With so much music now available for free online, it's no longer possible to be a pay-only service and attract new customers, and Rdio saw the writing on wall that it must be either free (at least partially) or die.

----------------------------------

Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.

Comparing The Music Services

My buddy Gary Myer sent me this chart the other day. It's from an LA Times article about the competition that Spotify will have when it's finally able to operate in the US. As you can see, one of the things that both Spotify and Rdio have going for them is the fact that they have your music available in the cloud and on-demand at any time, plus streaming radio service. The downside is that they're subscription services that charge you a monthly fee to listen on your computer, and about double the normal fee to add mobile access as well. iCloud will be a single charge per year.

Will this make a difference to the consumer? Will iCloud add radio streaming (don't see why not as you can get it with iTunes now)? I guess we'll have to wait until both Spotify and iCloud are available to actually see.

-----------------------------------

Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.

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

Check out my Big Picture blog for daily discussion of music, recording, and production tips and tricks.