16.8.07

Selling Music on Social Networks

On Reuters there was a piece where they were saying that labels are eyeing social networks as retailers, which isn't really news to me: I've been seeing this countless times, an effort made by both bands and/or labels in different kinds of promotion and profit. It's not small the number of record labels with a MySpace profile, but what's really interesting (and cool) to see is the number of record labels betting on social networks like Last.fm, showing that they have at least a glimpse of what they're doing. Also, it seems that major labels are seeing a bad side of DRM: besides the technical issues of implementing it, social networking users simply don't want DRM in their tracks, so an artist selling in those networks DRM'd files is in a clear disadvantage in relation to other, DRM-free, artists. I don't really like Snocap (I'll write about that in a later post), but Snocap's Rueff said something in conclusion that I want to quote:
"Social networks are the (peer-to-peer) networks of the future [...] They're this generation's MTV. If you want to be at a point of sale at the highest point of desire and consumption, be where the fan is."


Oddly, Gooveshark guys didn't like what they read: their first post about the Reuters' article basicly states that turning social networks (and services that float around them like Snocap) is a model "where your own network's members make a little side money for yourself, but a boatload of cash for your corporate overlords". They keep going, saying that "with more innovative services like Grooveshark out there, where you can not only make money off of your music but be part of a social network in the process? Who would deny that opportunity?". This quite amuses me, since the "innovative service" that Grooveshark presents is, basicly, the same as this Social Networks. Snocap, AmieStreet, GrooveShark, they're all the same concepts: bands sell, fans sell, buyers pay, a boatload of cash is supposedly made. What makes GooveShark different?

But they didn't stop here: a second article called "Damn Those Myspace Window Shoppers" was written. The writer quotes a study from EMR and Olswand saying that "More than half of internet users surveyed by Entertainment Media Research and the law firm Olswang said they surfed social networking sites such as MySpace and YouTube specifically to come across new songs.", but then tells us, without any kind of source, that "most of these people love to discover new music knowing full and well that they will ultimately dip from the illegal pool of music downloads to obtain the freshly discovered music". First, we don't know if that's truth, then there are no sources telling if illegal downloads contribute for sales increases or decreases - it surely depends from person to person but I doubt that they can find an imparcial source saying that it decreases sales, which should be good for them since GooveShark's business model depends on that. Then, he keeps randomly ranting, talking about how "added value" is needed, but saying that CD's give few or none (where's the extra value in digital music bought on GrooveShark?), even if "CDs had vastly superior sound compared to cassettes or records" (sorry mate, but vinyl records have way better sound!).

The conclusion? Well, there's really no directly related conclusion to take from this post. Finaly record labels are discovering the potential of the web and the turndowns of DRM, which is good. In relation to GrooveShark's comments, I just have to say that while it's preety important for a start-up to be close with their readers, using several ways to achieve it including mantaining a blog, a blog makes an image of that startup. Writing articles like these (and others) only contribute for people taking GrooveShark less and less seriously.

10 comments:

  1. Lately, the Grooveshark guys have been filling their blog with lots of crap. I don't know what's their goal, but I think they're turning it into something like Idolator: lots of gossip and fait-divers mixed with serious stories, which is not something I fancy very much... Also, it ruins their credibility.

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  2. 1. I will only briefly touch on this. Grooveshark is a peer to peer distribution network, much closer to Limewire or Last.fm than it is to products like SnoCap or AmieStreet.

    As for the "bands sell, fans sell, buyers buy" paradigm, you could say that about *any* service that sells music. Simply because GS sells a product, does not make it at all like another site that sells a product. That would be like saying that AmieStreet is iTunes music store because they both sell music.

    2. The biggest problem I have with your argument is that you are stating that the author (Josh Bonnain) is "stating facts" without sourcing them. The facts that you mentioned were written in the context of an article that was clearly an editorial. Editorial opinions should be based on "fact" (notice the quotation) but in this case anecdotal evidence is plenty to make a point.

    It would be difficult to convince me that *many* people do not use music discovery services as a way to generate a wishlist of songs to get from networks like Limewire. Is this true for everyone? Absolutely not! Is it true enough to act as a point in an editorial? I would say so.

    3. Vinyl records, when they are freshly purchased have superior musical quality. The second that they are used, they begin to degrade (even dust can seriously lower fidelity). Most of the vinyl that is currently being used has a much lower quality than an equivalent digital recording. Audiophiles often argue that Vinyl has a richer sound, this is a fair opinion but it is an opinion nonetheless.

    As for the "added value". Any service that offers digital distribution benefits from the following. (1) Increased availability (2) Increased portability and (3) the ability to use the "wisdom of the crowds" as it were to have songs recommended to you. There are several other benefits to digital over physical media, but these are the most cut and dry.

    4. Your conclusion resonates with me, not only as a reader of many, many blogs and the author of one of my own but also as an editor for the Grooveshark blog.

    It seems like you are upset that the current content of the blog is not *all* targeted at the audiophiles. This seems like a bad way to look at things.

    Music is a broad landscape containing everything from stories on the industry, to software that helps you enjoy your songs, all the way to the "lighter side" (silly reports on Hair Bands or American Idols). If you pigeon hole yourself into exploring just one of these topics you are cutting yourself off from truly discovering how rich music can be.

    You might argue that you think that the more light hearted content is foolish, but what you are saying is that there are articles on the blog that you don't like. Which is fair. The point is that there were at least two articles (Mr. Bonnain's) that you took the time to comment on. They made you think, even if those thoughts led you to disagree with their content.

    That is the point of an editorial news source, isn't it? To create content that leads to discussion. To give people a reason to think about topics and hear opinions different from their own. I welcome you to offer any rebuttal that you would like to *any* post that we write. In fact, if you care to guest blog I would be more than happy to review your work.

    5.) As for Miguel, I really want to refer you to point 4. We want to provide the sort of site that you can go to and learn something new every day. If we limit ourselves to just what a certain class of reader feels is important we alienate the hundreds, if not thousands of others with different opinions. Again, I implore you to submit content that you think meets your standards and we will be happy to review it.

    Thanks again for the conversation, I won't bother linking back to the site but you know where to find us.

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  3. > Grooveshark is a peer to peer distribution network, much closer to Limewire
    > or Last.fm than it is to products like SnoCap or AmieStreet.

    True. Yet, unlike Limewire or Last.fm, but like SnoCap and AmieStreet, "Grooveshark's members make a little side money for them, but a boatload of cash for labels and Gooveshark", specially Grooveshark, since there are people sharing stuff there from labels that have not signed a deal with you...

    > The biggest problem I have with your argument is that you are stating that the
    > author (Josh Bonnain) is "stating facts" without sourcing them. The facts that
    > you mentioned were written in the context of an article that was clearly an
    > editorial. Editorial opinions should be based on "fact" (notice the quotation)
    > but in this case anecdotal evidence is plenty to make a point.

    You cannot excuse everything you write with quotations and saying "I was joking".

    > It would be difficult to convince me that *many* people do not use music
    > discovery services as a way to generate a wishlist of songs to get from
    > networks like Limewire. Is this true for everyone? Absolutely not! Is it true
    > enough to act as a point in an editorial? I would say so.

    My take is simply that if you're going to state something like that, you should be right on your words and say "some people use those services to then get them from free services". That can happen with those services or any other, including GooveShark.

    > Vinyl records, when they are freshly purchased have superior musical quality.
    > The second that they are used, they begin to degrade (even dust can seriously
    > lower fidelity). Most of the vinyl that is currently being used has a much
    > lower quality than an equivalent digital recording. Audiophiles often argue
    > that Vinyl has a richer sound, this is a fair opinion but it is an opinion
    > nonetheless.

    Vinyl records have degradation, as CD's too, but yes, Vinyl records degrade faster. Yet, a new vinyl record has better sound quality than a new CD record. Also, your statement that "the vinyl that is currently being used has a much lower quality than an equivalent digital recording" is not only false, but is also quite the opposite to the truth: vinyl records today are released with better quality than a couple of years ago. Stating that vinyl has a richer sound is not "a fair opinion", is a fact. Saying otherwise is lying.

    > As for the "added value". Any service that offers digital distribution benefits
    > from the following. (1) Increased availability (2) Increased portability and
    > (3) the ability to use the "wisdom of the crowds" as it were to have songs
    > recommended to you. There are several other benefits to digital over physical
    > media, but these are the most cut and dry.

    Only now that explanation is gived, but it should have been in the original article. Plus, you can get the "wisdom of the crowds" with CD's, as I often do (listening them on Amarok, scrobbling into Last.fm). Same applies to "availability" and "portability": as a matter of fact those aren't differences on the support or format, but the services around them.

    > It seems like you are upset that the current content of the blog is not *all*
    > targeted at the audiophiles. This seems like a bad way to look at things.

    Not really. The issue with your blog is that articles have low quality and mess up with the image GrooveShark could have as a company. The problem is simply that GrooveShark's blog is written as a "blog about music", and not as "GrooveShark's blog", and that's affecting GrooveShark's image.

    > In fact, if you care to guest blog I would be more than happy to review your
    > work.

    Thank you, and don't take me wrong, but I think that if I write an article about music here, in my personal blog, despite it being personal it will be taken in better consideration than if it will be written in GrooveShark's blog, whose image is basicly fucked up.

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  4. First, you seem to be unnecessarily angry at Grooveshark. I know you have used the Alpha and I wonder why you seem to be so mad. I'll touch on that point later, but first...

    1. The labels make the majority of the purchase price of the song. Believe me on this, and when I say majority I mean -vast- majority. Assuming that we are taking money from labels who haven't signed with us is inaccurate at best.

    2. Joking? No one said anything about joking. I said it was editorial opinion. Like any Op-Ed piece in any publication to ever exist, an editorial is based on the opinion of the author.

    Just like you are free to have your opinions about Grooveshark, Josh is free to have his about social networks. I see no difference other than than the fact that you seem to be really angry at GS, in general.

    3. You can't download music illegally on Grooveshark. You could, as you say, use it to write your Limewire wishlist. You seem to think I am saying that GS solves all of these problems. What GS does is help people find music and purchase it legally. We believe that it does this better than the competition, but this is a sentiment held by anyone who has ever made a product since time immemorial.

    Digital recordings do not generally degrade in any time-frame that is relevant to the average user. Yes, I am aware that new Vinyl has better quality than a new CD (I said that). Vinyl is analog, CDs sample the analog signal and thus lose information. CDs, by their very nature, are less "true" than their Vinyl counterparts.

    All of this being said, most of the LPs that are in the market today are second hand. These LPs have been floating around for years and have accumulated the type of degradation that lowers their quality below that of CDs. If you purchased a Vinyl copy of a new recording it would be of higher quality but neither one of us disagrees with this.

    4. I mentioned "services that offer digital distribution". I never once said, only Grooveshark. Last.fm and all other community-based music networks offer similar discover functionality. The point is that with any service that offers community-based digital distribution you can tap into the opinions of a much larger, more varied, audience than if you simply relied on the people that you know.

    5. Final point. The Grooveshark blog is a blog about music, if we needed to be more clear about that I apologize.

    The rest seems to be coming from anger, if you would like to send an email to feedback@grooveshark.com we can discuss this further. I respect your right to your opinion, but instead of just spouting invectives wouldn't it be better to actually try to make a difference? Put away your anger for Grooveshark and help us see what you consider to be "flaws". You might find we're more receptive than you believe.

    I really would love to discuss this with you, and my mail box is always open. Thank you for the conversation.

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  5. > First, you seem to be unnecessarily angry at Grooveshark.

    Not really. I'm just really interested in new music business models (as you can guess by reading this blog), and saw what I think are the advantages and disadvantages of GrooveShark. In this post the only "negative point" I said about GrooveShark was, in fact, something that could be applied for a non-music start-up: telling that the way you use your blog is probably harmfull for your business.

    > I know you have used the Alpha and I wonder why you seem to be so mad.

    Unrelated.

    > The labels make the majority of the purchase price of the song. Believe me on
    > this, and when I say majority I mean -vast- majority. Assuming that we are
    > taking money from labels who haven't signed with us is inaccurate at best.

    If people share (and you get the transaction money from it) my music, since I don't have a deal with you, you're having that money for yourself, until you find an agreement with me. The same will happen with every label that hasn't signed a deal with you.


    > Joking? No one said anything about joking.

    You're right, you talked about "anecdotal evidence", not "jokes".

    > I said it was editorial opinion. Like any Op-Ed piece in any publication to
    > ever exist, an editorial is based on the opinion of the author. Just like you
    > are free to have your opinions about Grooveshark, Josh is free to have his
    > about social networks. I see no difference other than than the fact that you
    > seem to be really angry at GS, in general.

    I agree that Josh is free to have his opinions, what I said is that the kind of blogging GrooveShark has affects depreciativelly the image that GrooveShark can cause to its market. I am not angry at GS, not in general not in this particular issue.

    > You can't download music illegally on Grooveshark.

    How come? Can't I go there and download a track from Marilyn Manson, even if this record label hasn't sign any deal with GS?

    > What GS does is help people find music and purchase it legally.

    What I said is that GS helps people find music and purchase it legally in the same way that MySpace or Last.fm, nor better than worse.

    > most of the LPs that are in the market today are second hand. These LPs have
    > been floating around for years and have accumulated the type of degradation
    > that lowers their quality below that of CDs. If you purchased a Vinyl copy of
    > a new recording it would be of higher quality but neither one of us disagrees
    > with this.

    Right, we only disagree on the first part, where you say that "most of the LPs that are in the market today are second hand". Check wikipedia for more info on the issue.

    > The Grooveshark blog is a blog about music, if we needed to be more clear about
    > that I apologize.

    While I agree that every startup should have a blog, I think, as I said before, that yourse is being harmfull for your business.

    > The rest seems to be coming from anger, if you would like to send an email to
    > feedback@grooveshark.com we can discuss this further.

    I'm not angry.

    > I respect your right to your opinion, but instead of just spouting invectives
    > wouldn't it be better to actually try to make a difference?

    Like telling you that you should change GS's blogging style? I'm trying to, but you're hard to convince.

    > Put away your anger for Grooveshark and help us see what you consider to be
    > "flaws". You might find we're more receptive than you believe. I really would
    > love to discuss this with you, and my mail box is always open. Thank you for
    > the conversation.

    I know your mailboxes well, I've swapped e-mails with you several times. This one time I criticized you in public, but that doesn't make from me an anger man.

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  6. If this all boils down to you disagreeing about what we should post on our blog, then I will count that as a difference of opinions. We believe we should reach out to all sides of the music industry (including those who want news about things you consider frivolous).

    What suggestions would you make?

    Offhand, I never said that LPs aren't produced. What I am saying is that more CDs are produced than LPs and that a -lot- of the LPs that are produced have been around for quite some time.

    Thank you for engaging in this discussion.

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  7. Anonymous4:26 AM

    How about making a separate section that is prominent be "Grooveshark's Blog" and another separate section "Editorials", like they do in newspapers?

    Thus, the main bulk of the content is about grooveshark and less like Idolator, yet they can reach their music audience through the editorials.

    Just a thought

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  8. Anonymous10:28 PM

    Hey Miguel, Steve,

    I think there may be a slightly valid point about the blog - but the other points about Grooveshark I find useless and incorrect.

    Grooveshark is revolutionary in many ways - and superior in many ways to Amie Street or others. Why don't you sign up as an artist, Miguel. People may want to buy your dark ambient music.

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  9. What do you find incorrect?

    The dark ambient music project is mine, and I tought on signing a deal with Grooveshark, but our conversation din't went well: seems that they're not interested in signing with small bands like Merankorii, looking in how I was treated.

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  10. Andy Cars4:54 PM

    This whole discussion about whether vinyl or CDs is better in terms of sound quality is ridiculous since it is purely a subjective point of view and can never ever be a fact. What one person perceives as "better" sound quality or "richer" sound is subjective. What is a fact is the following:
    a) Vinyl has the technical capability of reproducing a wider frequency spectrum. CDs cut at around 16KHz while vinyl can go beyong 20KHz.
    b) CDs have a wider dynamic spectrum all the way up to around 90dbA while vinyl reaches to around 70-75dbA.
    Personally, I prefer CDs to vinyl but that´s just my opinion.
    Best regards/Andy Cars, Audio Engineer

    ReplyDelete