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RECAP: The Whole Story on the Frank Ocean Apple Music Exclusive, Spotify’s Label Contracts Expire, Closing the Value Gap in Europe

Posted by Glen Sears | August 29, 2016 9:14 am | No Comments

frank-ocean

Story of the Week

What the Frank Ocean Apple Music Exclusive Deal Means for UMG, Artists, and Labels
When Frank Ocean’s latest album ‘Blond’ dropped, it did so like a nuclear bomb, sending shockwaves throughout the music industry. In one of the audacious release strategies of recent years, Ocean and his team at 360 fulfilled the final album contractual commitment to Universal Music by ushering his breaking-the-mold visual album ‘Endless’ onto Apple Music.

But no sooner had Universal executives started daydreaming about Grammys then along came what turned out to be the ‘actual’ album ‘Blonde’, self released by Ocean (Universal contractual commitments now of course conveniently fulfilled) and, for now at least, exclusively available on Apple Music. Universal boss Lucian Grainge then reportedly sent a memo to the entire company outlawing exclusive deals with streaming services.

Sean Glass – a former Apple Music employee – wrote: “Contrary to what you read, there’s no scary Apple board room conspiracy where corporate is plotting to take over creativity via artist exclusives. There’s one guy who is behind ALL of these campaigns — and he is light years ahead of everyone else. He works intimately with each artist as a creative peer, and develops an amazing plan, this is no simple land grab. He works closer with the artists than labels do.”

That ‘one guy’ is very likely Larry Jackson – a Jimmy Iovine protege, who is tasked with striking artist relationships that result in exclusive deals for Apple.

Mark Mulligan of MiDiA Reseach claims, “Streaming exclusives (and indeed label services deals) work best when an artist has already established a brand and an audience. Most often that means after an artist has had a record label recording career. Apple cannot be relied upon to build anything more than a handful of artist brands.”

“Labels still account for the vast, vast, vast majority of music listening. Make no mistake, a momentous value chain shift is taking place, with more power and autonomy shifting to the creators, but that is a long journey and ‘Blond’ is but one part of this much bigger shift.”

Read the entire story on Music Business Worldwide & MiDiA Music Industry Blog.

Top Music News Stories

Spotify Is Out Of Contract With All Three Major Labels – And Wants To Pay Them Less. Spotify continues to be licensed by all three majors on a rolling month-by-month basis, and the possibility of UMG, Sony or Warner catalogues being pulled is widely regarded as out of the question.

Should We Believe All The Negative Hype Surrounding New DOJ Rules On PROs? Dave Brooks of Amplify offers an alternative perspective on the recent Department of Justice ruling, suggesting that the rules may in fact help rather than harm venues and event producers.

European Commission Seeks Solutions for YouTube Value Gap. Plans for user-generated platforms like YouTube and DailyMotion to require licenses or sign-up to revenue sharing deals with rights holders are reportedly being considered by the European Commission.

Playlists Dominate Listening For Most Music Streamers. Streaming music users love playlists and use them to drive their music consumption, according to a new survey and infographic just released by the analysts at Music Watch.

Amazon’s Echo-Only Music Streaming Service Again Rumored. The service will cost half of the now-standard $10-per-month that Spotify, Apple Music, Tidal (minus hi-res) and Amazon’s own rumored, full-feature service will cost.

Soundcloud Logs 175 Million Monthly Listeners To Massive 135 Million Track Catalog. New Soundcloud stats show just how big its footprint is, both in terms of listenership and the size of its music catalog — but most of their listeners are free and monetizing them, along with making such a massive catalog user-friendly, presents a challenge.

The Coming Arms Race In Online Music: Artist Services. Digital music industry veteran Tim Quirk examines the coming arms race in the music industry, with online music services competing to offer artists programs and features which enable them to generate revenue beyond just streaming royalties.

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RECAP: Pandora Nearing On-Demand Deals, Dubset Inks Deal with Sony/ATV, More News in U.S. Publishing

Posted by Glen Sears | August 22, 2016 9:16 am | No Comments

BN-PL848_PANDOR_P_20160818153948

Story of the Week

Pandora Nears Deals For On-Demand Streaming
Pandora Media Inc. is aiming to start expanding its internet-radio service as soon as next month, offering its hallmark free tier as well as two new monthly subscription options that will mark its foray into on-demand music streaming, said people familiar with the matter.

While the music industry broadly supports the new paid tiers, some record-label executives are still wary of granting Pandora permission to launch its free service in new foreign markets without the ability to control which songs they put on the free tier.

The foreign expansion could jump-start growth for Pandora, which has seen its listenership plateau in recent years at about 80 million active monthly users. Most listeners use Pandora’s free tier, with about 4 million subscribing to an ad-free version of its service, Pandora One, for $5 a month.

Read the full story on The Wall Street Journal

Top Music News Stories

Dubset Inks Deal With Sony/ATV. The Sony/ATV news comes on the heels of Dubset’s landmark rights agreement with the National Music Publishers’ Association (NMPA), giving hundreds of independent songwriters and publishers access to an emerging new royalty system.

Russian Collection Societies Break Ties Amidst Fog of Fraud. Earlier this month, several rights holders registered with RAO called for the organization’s management to be replaced and that fundamental changes to its charter be made, amidst major allegations of embezzlement.

What Is YouTube Red Paying Artists? Digital Music News claims to have been leaked an earnings statement from a “chill electronica catalog” showing the per stream and per-publisher royalty payouts for YouTube Red.

Samsung is shutting down Milk Music in September. Samsung will be shutting down Milk Music on September 22nd, urging its Galaxy and Note smartphone users to switch over to Slacker Radio, which powered the system.

Streaming Music Business Bigger Than Previously Thought. Glenn Peoples from Pandora claims “These adjusted streaming numbers are a good reminder there’s more to the streaming market than on-demand services that dominate the media’s attention.”

“Dept. of Justice’s New Decision Could Wreak Havoc on International Rights.” “When it needs fixing… don’t break it further.” Gadi Oron, the Director General of CISAC, laments the global implications of a new decision.

A Primer for the World of Music Licensing and Its Pricing. To help readers better understand this labyrinthine world, Ed Christman at Billboard put together an explainer, organized from simple to complex.

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RECAP: DOJ Slams BMI Over 100% Licensing, Judge Upholds BMG Verdict, Users Still Can’t Hear High Fidelity

Posted by Glen Sears | August 15, 2016 9:49 am | No Comments

DOJ music licensing publishing ASCAP BMI

Story of the Week

Dept. of Justice Slams BMI’s Protest of Licensing Changes
In a letter to Judge Louis Stanton, who presides over the rate court that determines what performance rights organization (PRO) BMI can charge for various uses of its members’ work, the U.S. Dept of Justice has responded to BMI’s challenge of its interpretation that the consent decree requires the performing rights organization to license songs on a “full-works” basis.

The DoJ’s letter aims to remind Stanton of all the places and times BMI has claimed its blanket license entitles a licensee to play any song in its catalog, including in his own courtroom. “Just five months ago, BMI told this Court that its licenses provide “immediate access to the more than 10.5 million works in BMI’s repertoire,” according to the DOJ letter.

The DoJ also noted that BMI is urging the court to defer to the U.S. Copyright’s Office’s interpretation of the consent decree, which is at odds with the DoJ stance. But, DoJ writes, “the question at issue, however, is one of antitrust law and decree interpretation, not copyright law.”

In closing, the letter, submitted by Kelsey Shannon, notes that after its review, the agency “concluded that modifying the consent decrees to allow fractional licensing would undermine the traditional role of the ASCAP and BMI licenses, impair the functioning of the market for public performance licensing, and potentially reduce the playing of music.”

Read the entire story on Billboard

Top Music News Stories

Judge Upholds $25 Million Judgment in Favor of BMG in Piracy Case. “This case presents the question of whether a conduit internet service provider may be held liable for the infringing activity of its subscribers based on the uploading and downloading of copyrighted musical works using BitTorrent, a peer-to-peer file sharing network.”

Sony Acquires Ministry Of Sound, One Of World’s Largest Indie Labels. The UK indie label specializes in dance and house music and has scored cumulative album sales of 70 million including 40 #1 UK albums and 21 #1 UK singles.

The Concept of ‘Value Gap’ In Music Services Could Harm Tech, Music Industry. Mike Masnick claims “When you have a one-size-fits-all model, it pushes towards a world where the vast majority of casual music fans are left out, in a misguided effort to try to force more money out of stronger music fans.”

Led Zeppelin On Hook For $800,000 In Legal Fees For ‘Stairway’ Case. According to the BBC, R Gary Klausner, the judge overseeing the case, said that Jimmie Page and Robert Plant, along with their publishing company Warner/Chappell were responsible for almost $800,000 in legal fees after ruling that the lawsuit was not frivolous.

Younger People Aren’t Driving the Resurgence in Vinyl, Study Finds. According to their Profiles data, it’s not the hip youngster looking to check out what vinyl records were all about, but rather, “[vinyl] records’ resurgence is rooted in middle-aged nostalgia.”

Top Two Execs Pushed Out Of Music Tech Startup Bkstg. CEO Ran Harnev and president/Chief Revenue Officer Erika Nardini, both former AOL execs, exited the firm in July — Three Six Zero Group executive James Sealey, who originally joined the firm as SVP of Development and head of music, will take over COO duties and founder and chairman Ori Birnbaum will see his role at the company expanded with new executive duties.

Does High-Fidelity Music In Streaming Really Matter? Probably Not, Says a CNBC Test. Out of 48 total songs played, only 1 out of every 3 participants identified the correct high-fidelity sound service, but “at least four times” people couldn’t hear any difference.

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RECAP: U.S. Publishers In Uproar Against DOJ Consent Decree Ruling, EU Privacy Shield, Streaming Nets Labels $15M Daily

Posted by Glen Sears | August 8, 2016 9:42 am | No Comments

05MUSIC-superJumbo

Story of the Week

U.S. Publishing Industry in Uproar Over DOJ Licensing Plans
The Justice Department announced on Thursday that it had concluded a two-year investigation into the complex world of music licensing and decided against making changes to the regulatory agreements that govern Ascap and BMI, two large clearinghouses for performing rights that process about $2 billion in royalty payments each year.

The DOJ also added a new requirement, saying that for Ascap and BMI to comply with the existing regulations, they must offer “100 percent licensing” of their songs. Since then, members of the publishing community have been having their say, and it should not surprise you to hear that they are pretty much 100% against the plans – with many questioning the motivation behind the DoJ’s move.

“Where will this consistent erosion and undermining of the fundamental rights of authors and composers end? How is it that policy makers, on both sides of the Atlantic, have put themselves in the business of making decisions that are disastrous for the music community, but curiously beneficial for others?” is how IMPF president Pierre Mossiat put it in a statement condemning the plans.

Read the full story on Music Ally & The New York Times

Top Music News Stories

An Alternative View Of The DoJ’s ASCAP/BMI Consent Decree Review. “When the Department says that the PROs are required to offer 100% licensing, it conforms to the default rule of copyright law: so long as one author agrees to let a PRO license their work, the PRO has permission to license the whole work to users.”

European Regulators Greenlight Sony/ATV & Jackson estate Deal. “The transaction will not materially increase Sony’s market power vis-a-vis digital music providers compared to the situation prior to the merger,” Reuters reports an EU competition enforcer as saying of the approval.

Joint EU, U.S. Digital Privacy Shield Comes Into Effect. The “EU-U.S. Privacy Shield” ensures that everyone in the European Union has rights when their data is processed, such as the right to ask a company for information about the data they hold about them on U.S. servers, or to amend their records if the data are outdated or inaccurate.

Warner Music Group And Vevo Reach Deal After 7 Year Impasse. The deal does not extend to Vevo on YouTube, but is part of an extensive reboot for Vevo, including a redesign and new initiatives in programming and branding.

Lenders Crush Sillerman’s Plan To Pull SFX From Bankruptcy. Bob Sillerman’s plan to emerge from bankruptcy and retain some of his SFX assets was foiled by the same lenders he originally dealt with to finance the company, after they filed a new restructuring agreement with dramatically different – and significantly less favorable – terms.

Every Day Major Music Companies Earn $10M Millon, Indies $5 Million In Streaming Revenue. With average payments hovering around $.00575 per play, its easily arguable that Spotify, Apple Music, and others are not returning sufficient revenue to creators, but in aggregate streaming has become a major source of revenue for independent and major labels.

US and Swiss Collection Societies Partner to Form ‘Mint.’ SESAC Holdings, the U.S. company that owns the collecting society SESAC and the Harry Fox Agency, is launching a joint venture with SUISA, the Swiss collecting society.

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RECAP: MiDiA Research Uncovers Trove of YouTube Intelligence, Guvera Shutters in Australia, WMG & Vevo Close to Deal

Posted by Glen Sears | August 1, 2016 9:40 am | No Comments

youtube silhouette

Story of the Week

MIDiA Takes A Deep Dive Into YouTube As A Music Business
MIDiA Research has released a report on YouTube and the video platform’s impact on the music economy. With YouTube commanding a massive audience, but still drawing criticism and skepticism from artists and labels, the report adds much-needed data to explain the service’s role.

“Safe Harbour-enabled UGC is no longer the threat it once was, with just 2% of music video views from unofficial uploads,” MIDiA Research says. That statement, backed by research detailed in the report, is an interesting contradiction of some rights-holder complaints that UGC (user-generated content), and the regulation surrounding UGC platforms, do not adequately protect artists, labels, and songwriters.

The report examines several facets of YouTube’s business, including details about the most popular videos and distinct trends in listener behaviors. It revealed that three-quarters of music video views happen through official sources, and a further 76% of those are uploads from distributor Vevo. It also found that audience behaviors are quite sophisticated, with sizable listener groups only listening to the audio or navigating directly to an artist’s channel.

Read the full story on RAIN News

Top Music News Stories

Warner Music Group and Vevo Close to Reaching Content Deal. For Warner Music Group, this comes in a year when the company seems to be focusing its efforts in making more licensing deals, having partnered with Facebook, and signing a deal with social video sharing app musical.ly to let its music be licensed for the platform.

Canadian Music Industry Reaches $66M Settlement With Piracy Site isoHunt. The court found that isoHunt and Fung were liable for $55 million in damages and an additional $10 million in punitive damages, plus another million in court costs.

SOCAN And Audiam Talk Tech, Streaming And 21st-Century PROs. It’s unusual to see a PRO acquiring a music/tech company, let alone two in quick succession; Music Ally spoke to SOCAN chief executive Eric Baptiste and Audiam boss Jeff Price [paywall] to explore its strategy.

Troubled Music Streaming Startup Guvera Closes Up Shop in Australia. “Born and launched into Australia in 2008, we have had the best time bringing all the latest tunes to the ears of our listeners here; unfortunately, and with a heavy heart, the time has come to pull back from our operations in the country.”

SoundCloud Is For Sale, But They’re Having Trouble Finding A Buyer. In June, SoundCloud raised $70 million from Twitter in a $100 million funding round at reported valuation of $700 million — now Soundcloud is for sale.

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