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.

Music: get it for free but give bands money

Finaly a new trend started: one where users can download music for free and bands still get payed. We have several players on that field:

• Grooveshark - I've talked about it before, but I have to write more extensively about it. There are a number of reasons why I think it will fail, and it is not the best solutions for fans and artists... In this p2p service users share their music as they're used to in other p2p networks, but now it's supposedly legal to do so. Each time a shared file is downloaded the user gets money for it - but if you want to download music you also have to pay. From the transactions, Gooveshark takes a bite and copyright holders also get a share - if they sign a deal with GrooveShark.
  
• ReverbNation is a music social network, similar to those such as PureVolume, or MySpace Music. The thing is, they'll add "Fair Share" to the network in July. FairShare is basicly a system that makes artists recieve a share of the publicity revenue ReverbNation has when someone is listening to their music. People get music for free, artists get paid. I, for one, can't wait for July.
  
• Poptopus isn't a music social network, or something that lets bands have pages. Instead, they make widgets with songs submited by artists, and that widgets contain ads. That means that a blogger, for instance, can have a music player with songs of his choice in its website, and the revenue from the ads in there are splited between the blogger, the artist of the tracks presented there, and Poptopus, of course. Once again, yet another source of incoming. Their closed beta is going to start soon.
• We7, also yet to be launched, also lets users download music for free and pays artists, with ads revenue. The downside here is that the ads are audio ads inserted at the beginning of the music file, which kind of cuts off the music experience. It would be great if ReverbNation and Poptopus weren't in the field, this way... Nah.
  
• Playble is yet another to be released service that will "allow users to download music by artists for free and still support them financially. Playble.com will give companies with strong brands the opportunity to support music and artists directly". Unfortunately there are no more details about it yet...
  
• Finaly, yesterday the blogosphere started talking about RCRD LBL, a netlabel that will release its artists' music as free DRM-free mp3's and yet pay them with ads revenue. Not as good as ReverbNation's offering in the aspect that any artist can sign in into ReverbNation, but not into RCRD LBL. Yet, for an artist signed on this one, the revenue must be way bigger...
  

Do you feel there's something missing here? Please leave a comment and tell me. I can't but predict that we'll have interesting times in the music industry during the next months...

Web Music Services for bands - revisited

I've talked about this before, but the social web is developing fast and well, so there are news on the field... So let me revisit the topic, and talk a little about the "new web music services for bands".

I'm going to list five services that can help bands promote themselves, and fans to easily access to their favourite bands and even help them. Here they are:

ReverbNation is a newcomer on this blog. Basicly, ReverbNation started last October as yet another music social network, in the vein of services like PureVolume. The thing is that since they started they didn't stop adding new features, some of them really cool for artists. But what makes them start this list is a feature that they don't yet have but will do in July: an ad revenue sharing program for their artists, called “Fair Share”. With this, fans are giving to their artists money each time they visit the artist webpage and specially when clicking in the ads presented there. Alternative sources of incoming are allways cool, right?

Then, another newcomer. Poptopus isn't a music social network, or something that lets bands have pages. Instead, they make widgets with songs submited by artists, and that widgets contain ads. That means that a blogger, for instance, can have a music player with songs of his choice in its website, and the revenue from the ads in there are splited between the blogger, the artist of the tracks presented there, and Poptopus, of course. Once again, yet another source of incoming. Their closed beta is going to start soon.

Then, we're back to those I've already talked about. GrooveShark is getting bigger and better day by day, even if still in Alpha. I'm still swapping e-mails with them and plan to have a new blog post about it soon enough, but the concept is good: a legal p2p music network where you're paid to share and artists whose tracks are shared too.

SellABand also keeps going on, and are, at least, a very successful case of an indie label - after all in less than an year they've managed to launch several bands albums and compilations, besides organizing events - for instance. Here listeners pay to give the bands a chance to release an album, and after they can make money out of it.

Last.fm continues to be awsome, a great way for a band to expose themselves if well exploited. They're experiencing a boom of users now that Pandora is enforcing their users to be located in the United States, yet there are rumours of Viacom wanting to buy them which are no good news.

Also, I'm curious about two new services that might be quite interesting: We7 and Playable. When more info on those are announced, I'll surely let you know...

GrooveShark alpha

GrooveShark is a web application intended to create a new business model for music, being legal and yet using all the things that make p2p networks a success (including getting music for free). As they say in their blog,

Grooveshark is a web-based application for sharing music within a community of music lovers. We distribute DRM-free MP3s across a mostly p2p network.

Adding to that, it also has a lot of social features, that you're used to see in other services like Last.fm.

In the 26th of March they started their limited alpha release (click there to request an account), and yesterday I got an invite to be part of it. The thing with it is that GooveShark isn't 100% web, and it has a lot of stuff (including registering) that can only be done with their desktop application. At least for now that application has only a Windows and a Mac OS version, so I wasn't able to try it. I tried to run in on top of wine, but I couldn't (something to do with the instalation of the JRE). Well, that at least tells me that the application is written in Java, so I guess it will be easy to do a Linux version, and I surely hope they do it. I wrote them an email asking about it but had no reply until now. Well, I guess that I'll have to wait until they wake up ;-) As soon as I have a reply about it I'll write it here.

Until then... Mashable also got an invite, and they covered GooveShark in their blog. So, if you're interested, take a look at it here.