1 post tagged “we7”
Below are the notes I made on this Music Tank event yesterday evening. Each of the panelists made introductory comments (Ryan Regan was 'keynote'), and these comments are the first paragraph under each name. Subsequent paragraphs are comments made in the Question and Answer discussion.
I tried to make notes as faithfully as I could, but I am fallible. Beware of taking these notes as direct quotes from the named individuals: they are not, unless indicated by quote marks. If you spot anything that you know to be incorrect, please alert me via the comments, and I will correct my mistake(s).
In due course, a full transcript and recording of the event will be made available to Music Tank members on their site. That will be the definitive version. I hope this one may be of some interest in the meantime.
Ryan Regan, CFO, Last.fm
Devised to be the last place you'll need for music online. Only VC round was in 2006. Launched free to use, ad-supported, on-demand streaming in January. Available in US, UK and Germany - considering other territories. Allows people to get involved in discovery without commitment of downloading application and building a profile. Structured deals so that every time a song plays, the artist or rightsholder receives some money. Fully licensed. Currently 2.7m tracks available on-demand, and looking to grow this. Good opportunity for advertisers as audience is highly engaged, doing something they're passionate about.Visitors are up 83%, listeners are up 150%. It used to be that only a small proportion of users were using the streaming, now it's up to 40%.Still early days, and need to grow the business to make it serious for all the interested partners. Need to get the brands online. CBS have lots of experience of monetizing listening. Bring in more partners to provide content.Will be launching a subscription service offering something beyond free on-demand service.We've always respected rightsholders [Charles Caldas: "I know a few people who would beg to differ with that statement."] Streaming was always a small part of Last.fm, and not the main reason why we had the valuation we did when CBS bought us.
In a world of ubiquitous access, we believe Last.fm services will still have a role to play in helping you choose what to listen to next, even if they're not the people providing the streams.
Agree
that technology, not licensing, is the limiting factor for the
celestial jukebox, but expect this to arrive within five years.
Alex Valassopulos, Head of Business Development, Sony BMG
Download to own is still top priority because of the economics. Subscription is next most valuable. Streaming and micropayments are third, because the figures aren't great yet - but still interested in this. Need to trial every model out there. We may have to add in 'parameters' to ensure we're not cannibalising other revenue. Streaming deals are the discovery end, but ownership is still key. Only slowly learning what a good CPM rate is.Slacker might fit within a couple of parameters: we'll have to have a look at it.
The
three tiers will be swept away if we arrive at true ubiquity of access,
the real celestial jukebox. This is utopian. It's not licensing that's
holding it up, it's the technology, WIMAX and all that.
Jez Bell, Broadcast & Online Licensing Director, MCPS-PRS
Collecting societies are sometimes an afterthought in the licensing process to the labels.Different approach to Sony BMG's ranking of priorities. More even-handed approach. Everything we do is precedent-based - this takes away some flexibility. What's good for one part of the supply chain may be not so good for another part. Massive amount of activity over the last two years with Web 2.0 models. Challenge for a collective licensor is to maintain simple access to all rights, which has the flexibility that licensees want. Being fair and equitable is not always consistent with flexibility. Key thing we fought for in the copyright tribunal is to have licensing schemes that balance flexibility with minimum value for the music that's being used. Want to provide a clear and consistent message to the market and licensees.Publishers have given us the message to go out there and license - there are no taboos.
Getting the subscription model working would be a Holy Grail, because it provides consistency and predictability of income. Worried about potential risk of cannibalisation.
I think the celestial jukebox is already with us, whether through Last.fm, We7, Spiral Frog etc. Once the consumer has access to all the music they want, you have the experience of the jukebox.
ISPs
never complained about illegal filesharing because it was part of the
demand that built their customer bases. It's ironic that when a
properly licensed service that genuinely engages users (BBC iPlayer)
comes along, the ISPs make a fuss.
Charles Caldas, CEO, Merlin
Merlin formed specifically to deal with the issues being talked about today. The independent sector needs to create some efficiencies in order to participate in the new licensing structures, Accounts for 30% of the market, but represents thousands of small labels. The music has created value for the likes of MySpace and Last.fm, but has not seen the rewards from this. Merlin is not for profit.Part of the reason Merlin was started was as a response to businesses using music to build value and then selling out.
Clive Gardiner, We7
Only in the streaming business for a week! Challenges: would anyone come to our site? Would anyone license to us? Would advertisers support the model? Started with downloads. Mediagraft technology grafts ads onto the music tracks. The 30-second preview is not enough. All downloads are MP3. Streaming front-end is important: traffic seems to be up ten times in the last week. Display ads on their own will not work.Targeting is the future for getting ad rates up.Have to listen to the three points of our triangle: listeners, rightsowners, advertisers. Our streaming service is a form of permission marketing.
Paid
downloads (PPD) account for 80% of digital revenue, so that's where
most attention is now, but We7 represents a move away from this to new
models.
Adrian Drury, The Cloud
We're the ugly boring bit in delivering the Celestial Jukebox to mobile devices. The multiples are much bigger: you change your audience by a factor of ten if you can market to them during their dead time away from their desks. The Cloud is building a mobile broadband network that is fit for this purpose.No difference for the user in buying a track on a mobile device, compared with at home. Streaming: have done some work with Slacker in the US, a mobile network Walkman. Slacker have created their own music right, caching music on device for a limited time. Also exploring location-based downloads and ads: very specific demands for music associated with a gig.Is FM going to stick around, or are we going to move very quickly from an FM world to an IP world?
Bittorrrent is a nightmare for us: users just sit there and chew up bandwidth. Worried that someone could bring out a Limewire client for Nokia handsets.
[Keith Harris: are you going
to police the network?] We block specific ports. Only a tiny fraction
of miscreants know how to switch ports.
Keith Harris (chair)
Worried about the attack of harmony between panellists: either someone isn't telling the truth, or we're not living in the world I thought we were.Do rightsholders want too much money from small start-ups to allow them to get off the ground.
Problem
with revenue-share models is that it's often not clear what counts as
revenue. Is it just the ads, or is it the other strands of revenue?
