Sunday, August 3, 2008
"Don't it always seem to go, that you don't know what you've got till it's gone." Joni Mitchell © 1966-69 Siquomb Publishing Co. BMI.
I had lunch the other day with a friend of mine, blues legend Otis Taylor. Otis recently won the coveted Downbeat Critics Poll for best blues album of the year for his "Recapturing the Banjo" recording, a wildly innovative and entertaining education for those of us who grew up associating the banjo with Lester Flatt and Earl Scruggs.
As he usually does, Otis had something interesting and challenging to say. We were talking about our kids - both his and mine are college-aged. And he suggested that they had best be sure that they're planning on doing something that the Chinese and other lower-paid laborers abroad can't do. His point: the Chinese engine of economic growth is moving at an enormous rate of speed. "Made in China" used to be stamped on all manner of relatively simple-to-manufacture consumer goods. But today, China has become identified with production that ranges from basic consumer goods to high-tech products of all kinds.
We have become accustomed to exporting American dollars and manufacturing jobs to China in exchange for consumer goods. But in recent years, with the rising cost of energy and the decline of the most prominent symbols of cheap energy, the automobile and the entire automotive industry, a new model has begun to take hold.
Some parts of the future that this new model suggests have been apparent for some time. Other elements are just beginning to become clear.
Tonight, after dinner and margaritas with a few of our kids (and a grandchild, Aiden), Nanette and I wandered up the street to the Boulder Bookstore. We do this almost every time we head down to Pearl Street for dinner. Boulder is beautiful on almost any summer evening. Full of scents and sounds and surprises, it has as much magic for me now as it did the first time I visited, back in 1985. And the Boulder Bookstore is an institution. It has the feel of a place that belongs in Boulder. Like a number of restaurants that bear an unmistakable "local" feel, including the Mountain Sun, Foolish Craig's, Jax, and the Mediterranean, among others, the Boulder Bookstore seems to belong here.
But tonight, as we headed in, I realized something had changed. Not with the store. With me. I was looking forward to walking through the front door as much as ever. I was eagerly anticipating my first view of the shelf that holds the books that are favorites with the locals. I knew where the Seattle chocolates would be. And I knew before we entered the door that I would head, before much time had passed, to the section of the store that displays the music-related magazines. But this time a thought crept into my head: I wonder whether I will see a book I like and decide not to buy it at the Boulder Bookstore because I can download it, instead, to my Kindle.
And that got me thinking. If you're the Boulder Bookstore, how do you fight that? I love Amazon. Love it. They grab more of my consumer dollars each year than I, or anyone, could have guessed had they looked at the marketplace back in 1998, just ten years ago. I buy from Amazon because it's fast, it's reasonably priced, the experience is uniformly good and I can find almost anything I want. Immediately.
But I love the Boulder Bookstore too. And it occurs to me that there may not be enough consumer spending to go around. Many of the books, including bestsellers, that would cost me $15-20 or more at the Boulder Bookstore will cost less than $10 via Amazon's Kindle download store. And finding and purchasing books using the Kindle is remarkably fast. Efficient. Inexpensive. When I download a book instead of purchasing it in hard copy, fewer trees have to be felled. And having a few hundred books on a device the size of a notepad is a lot more convenient than lugging them around. Trust me. I know. And anyone who knows me has seen me try to lug a dozen or so through one or another airport.
So, what happens next? While you're contemplating that, how about this: "China as the World Factory (Kindle Edition)." Where do you suppose the Kindle is manufactured?
And what about the Boulder Bookstore? Just like Joni Mitchell says, "They paved paradise . . . " Let's hope that doesn't ever happen. That would really suck.
Monday, March 3, 2008
Yesterday I tossed out a tweet in Twitterland to ask whether the major record labels had become their own worst enemies. Actually, I don't think there's any doubt about it. Steve Jobs is their nemesis. Or so they suppose. But their problems are not nearly so simple as that.
When the engine of growth for your industry, the enthusiasm of the 13-24 year-olds for the latest music, no longer contributes to your bottom line, you have a serious problem. It's even worse for those in the 18-24 year-old age group. I spoke on Saturday to the owner of an independent record store in Boulder, Colorado. He has operated that store for many, many years. When I suggested that 18-24 year-olds aren't paying for recorded music any more, I expected at least a little push back. Instead, he vigorously affirmed my suggestion. "Tom," he said, "we saw signs of trouble years ago, but it became absolutely obvious that over the past two years what you say is true. Eighteen to twenty four year-olds aren't buying recorded music."
So here are my questions:
(1) does that matter?
(2) if it does matter, can anything be done about it?
(3) and if something can be done, can it be done in time to make any real difference?
My answers to these questions will be developed in subsequent posts to this blog.
Meanwhile, Trent Reznor of NIN fame has taken his cue from Radiohead and raised the bar a bit. In addition to offering some of the latest mp3 content for free, he has assembled multiple packages at various price points - offering content at $5, $10 and even $300. How is it going?
Trent seems pretty pleased so far!
Sunday, February 17, 2008
What I'm really looking forward to is the New York Times' coverage of Spotify (based in Europe and currently in closed beta).
Thursday, February 14, 2008
I thought I'd give the buyable search and discovery a try. They recommended I search the Beatles, but, nah! I thought I'd search for the one thing the Beatles told us that money can't buy. That's right. I searched for "love."
Some of you are going to think I'm searching for love in all the wrong places. But, as it turns out, my search did manage to turn up a whole lotta love. (I know. Terrible. Absolutely terrible.)
But I have to say, the results are not too shabby.
Thursday, February 7, 2008
I don't know if you've been reading Marc Andreesen's blog.
If you haven't, you should. There are a handful of folks who write things that just nail what's going on in the world at a particular point in time. Chris Anderson, author of The Long Tail and Editor in Chief of Wired Magazine does that. My friend Brad Feld does it from time-to-time and so does Fred Wilson. But Marc Andreesen is taking things to another level entirely. Check it out.
When I saw Deborah Solomon's New York Times interview of Sheryl Crow, I had the same reaction as Chris Anderson's referenced below.
For instance, this today from Silicon Alley Insider:
Whether it's software, patents, movies, or music, as a planet, we have decided that things that exist only in the form of atoms, or are not offered as a service, have no value.
Or this, from Sheryl Crow in last weekend's New York Times magazine (from which this photo was taken):
I’m sad that people feel like music should be free, that the work that we do is not valued.
Don’t you feel valued enough? It’s more about consciousness. When music comes free by way of friends burning CDs, there’s not that understanding of the work that goes into the making of an album.
Spot the error? It's that the only way to measure value is with money. Of course the Web is built mostly on two nonmonetary economies, attention (traffic) and reputation (links), both of which benefit hugely from free content and services. And it's a pretty simple matter to convert from either of those two currencies into cash, as a glance at Google balance sheet makes clear.
In a recent post, we listed dozens of business model built on free. All of them are based on the notion that free stuff does have value and the way we measure that is in the time people spend with them. Do I actually need to remind Wall Street analysts that time is money?[The Long Tail]
Forwarded or Posted by Tom Higley
Monday, February 4, 2008
Of course, the bigger story in the news these days is Microsoft's $44.6B bid for Yahoo. What would this mean, long term, for Yahoo Music Unlimited? Hard to say, but what are the odds that Microsoft would continue to use RealNetworks' Rhapsody music offering? Pretty slim, I'd say. It's far more likely that Redmond would see Yahoo Music as an adjunct to its own struggling music offerings and perhaps pull together some combination of Yahoo Music Unlimited that works with the Zune player. After all, Microsoft has already reportedly given the major labels (or at least Universal) a piece of the Zune sales price. (Though it's not like a percentage of Zune sales is going to go very far in helping the recorded music industry reverse the 10% decline in annual revenues it experienced in 2007.)
Unlimited Has Its Limits; Yahoo Taps Rhapsody on Subscription
Yahoo Music is now outsourcing its subscription-based offerings to both RealNetworks and Viacom-owned MTV, according to information disclosed Sunday. As part of the deal, subscription application Rhapsody - now a joint venture between RealNetworks and MTV - will become the exclusive provider of on-demand music services for Yahoo. The move replaces Yahoo Music Unlimited, a service that experienced tepid uptake despite aggressive pricing. Yahoo Music subscribers will migrate their accounts mid-year, according to the companies.
For RealNetworks and MTV, the move introduces Rhapsody to an immense audience, and a larger potential subscriber pool. "Soon, tens of millions of Yahoo users will be able to access their favorite music through Rhapsody – wherever they go, whenever they want it," said RealNetworks chairman and chief executive Rob Glaser. Rhapsody will also handle various non-subscription transactions, including a-la-carte downloads.
The news comes alongside a music-related acquisition by Yahoo. The mega-portal revealed that it has now purchased the privately-held FoxyTunes, a player plug-in that quickly finds lyrics, videos, bios, and other song- and artist-related information. FoxyTunes offers compatibility with 30 desktop and web-based players.
But during the course of the evening, her mom called my cell phone from the hospital's emergency room telephone. Right in the middle of the call my iPhone died. Completely. I tried to restart it. No go. I plugged it into the computer and it went into "this iPhone needs to be restored" mode. Several downloads of software and lengthy attempts at restoring the pone (and its data) each failed. And here was the problem: the phone call from the emergency room came from a land line. I had no record of it (except on the iPhone, which was quite dead).
Eventually, I managed to find a support document on Apple's site that suggested creating a new user on your computer and restoring the phone using the new user. That worked. (My iPhone is now "test's" iPhone.)
And while all this was going on I called the hospital's main number via a land line, and after what seemed like an interminable wait, was finally connected to the emergency room and even, miracles of modern technology, to my daughter's room.
But what are the odds that my iPhone would die so completely at just such a moment? It was one of those horribly frustrating moments in life and a reminder that the technology on which we depend daily for much of our personal and business communications is not guaranteed to work in time of crisis or emergency. Sometimes things break. And they sometimes break at the worst possible time.
Thursday, January 31, 2008
This afternoon, I was in a meeting with the iggli bloggers. I looked away for a few moments, and the next thing I knew Quincy was running the friggin' meeting. A Wegman-esque moment . . .
Wednesday, January 30, 2008
Steely Dan - Do It Again Sitar Solo On Guitar - Awesome video clips here
The iggli band has been talking about covering Steely Dan's "Do It Again" . . . and somehow or other I stumbled upon this clip at Metacafe that nails the lead guitar solo originally played by Denny Dias (who in recent years is reportedly a computer programmer in Los Angeles). Incidentally, this - from my point of view - is one of the classic guitar solos of all time.
In the mornin you go gunnin'Excerpted from "Do it Again," Steely Dan, "Can't Buy a Thrill"
For the man who stole your water
And you fire till he is done in
But they catch you at the border
And the mourners are all singin'
As they drag you by your feet
But the hangman isn't hangin'
And they put you on the street
You go back Jack do it again
Wheel turnin' 'round and 'round
You go back Jack do it again
Tuesday, January 29, 2008
Should Content Owners (Major Recording Labels) Be Able to Compel ISPs to Remove Suspect Content (e.g., "Pirated" Music and other Media)?
So, do you think that the content owners - e.g., major recording labels (Universal, SONY / BMG, Warner, EMI) and major motion picture industry - should be able to compel ISPs to police the content that is delivered over the Internet? If the answer is "yes," Comcast, AT&T, Earthlink and other major ISPS will become the cops of the Internet - not pulling over speeders - but shutting down anyone/anything that might seem to be delivering content that Universal/Warner/SONY/EMI conclude is illegitimate. From the perspective of these corporate groups, the ISPs represent a point of leverage in the system. The RIAA hasn't had much luck stemming the tide with its lawsuits against consumers. But lawsuits against ISPs, that might prove more successful.
The focus here, of course, is on stemming the 20:1 disparity (claimed by the IFPI) of pirated downloads compared with paid-for downloads. If the labels can make this happen, they're suddenly in the money and profitable again. Maybe.
I'm curious, though. What do you think? What do you think about the world/culture this would create? Is it a good thing? A bad thing?
Monday, January 28, 2008
This is not exactly what you'd want to do when you launch your music service. At first glance, this looks really amazing. Who isn't going to be impressed by 25 million tracks? Free!!! And all entirely legal, blessed by the major record labels.
Evidently not. At least not yet. In a story that is still unfolding, a number of news outlets today reported that several of the music labels are confirming that they have not yet signed deals with Qtrax, including Universal, SONY / BMG, EMI and Warner Music Group. Let's see, are there any major labels left? Nope.
Music Labels Say No Deal with Qtrax says the Reuters headline.If all press is good press, well, no problem. If not, well, Qtrax is in deep shit. Ah, but you'd never know it from their site. In fact, it looks healthier today than it did the day they made their announcement. But the major labels aren't just raining on this parade. They're pulling the plug on it. At least for now. Stay tuned.
Qtrax Debut on Hold Amid Licensing Snag says the Associated Press.
Another undo: Qtrax's deal with all the major labels. Make that none.
Sunday, January 27, 2008
In an article entitled "Major Labels Allow P2P Music Sharing on Qtrax," Wired's Listening Post offered the following tidbits:
After years of fighting peer-to-peer file sharing companies, the major record labels have decided that if they can't beat them, they might as well join them -- in one case, anyway. At the MIDEM conference in Cannes, QTrax announced deals with all of the major music labels and publishers to offer the first free and legal ad-supported P2P service to include major label music.
"You can't change the attitudes and habits of what is now probably amounting to two generations who believe that music ought to be free on the internet," said QTrax CEO Allan Klepfisz. "Those people are not going to be discouraged by Supreme Court decisions, they're not going to be discouraged by technological interference. Ultimately, what will discourage them is a demonstratively better service."
Klepfisz pegs the catalog of the service over 25 million songs, which would dwarf those of iTunes and other online music stores. The songs will be wrapped in Microsoft's Windows Media subscription DRM. This means that unlike the free, ad-supported services offered by imeem and Last.fm, QTrax's songs can be downloaded onto compatible players. The application is based on the Songbird engine, so sharing and downloading occurs within a Firefox browser -- no separate application required.
As of now, the tracks are not compatible with the Apple iPod, but Klepfisz said that the service would be compatible with iPods before too long -- an indication that Apple could apply the subscription technology developed for iTunes Movie Rentals to the music market.
Every Friday - well, almost every Friday - after doing what people at tech startups do, a bunch of us at iggli head over to my studio space in Boulder and kick out the jams. So far we've "covered" (some might say "butchered," but we're definitely improving) Interstate Love Song, Plush, Black Dog, Layla, and even Chameleon.
We're probably having too much fun. Actually, I can't believe how good these folks are. Sam does a mean Robert Plant imitation on Black Dog. Aaron rips the bass and does a creditable job of pretending to be John Bonham on the famous Zep tune. Dehru's shreds that guitar. And Stephen is transformed when we play from mild mannered reporter to guitar god.
Ted wasn't present for this session, but he's a damned good drummer!
So, when they're not playing great music, Sam, Aaron and Stephen blog for iggli. Dehru's an iggli developer/engineer and Ted is iggli's VP Finance and Business Development.
Saturday, January 26, 2008
This past Friday night I headed out to Trilogy to check out Soundrabbit and Michael Garfield. I haven't been out to see live music in a long time, which is more than a little ironic given my iggli connection. In any event, Michael, who opened, is one of iggli's bloggers, and Soundrabbit includes Chris Anton, who worked for iggli extensively during 2007 doing graphic art, design and web development tasks as requested. They're both great guys, and it was wonderful to be able to check them out.
The photo above is from Soundrabbit's press kit. They did a great job at the show, though I was disappointed (as I'm sure they were) that there weren't a few more people in attendance. It was especially challenging for Michael with a sea of concrete between him and the audience. But he also performed well - a great collection of approaches and techniques (including the use of a ukulele on one song).
Soundrabbit is doing something particularly innovative with its business model. For an annual subscription fee you receive a membership, a virtual backstage pass, to all of the band's output throughout the year. The band describes it this way
"We said to ourselves, " says Anton, SoundRabbit's electric guitarist, "What if we were to come up with a model that allowed us to remain incredibly close to the growing population of fans, provide them everything in the way of music, merchandise, shows, behind-the-scenes stuff, and have a charitable side to it like Newman's Own [salad dressing], where we're able to make contributions to great causes on behalf of the SoundRabbit community? It's a win-win-win all around."
The band developed a membership model, similar to some of the online fan clubs that major label bands have created, but very different in two very important ways:
1. The "RBT Backstage" is the whole enchilada, not just the "extras."
A Backstage member is viewed by the band as a "shareholder" of sorts. When a person signs up to be a member for a year, he/she receives every single music release created by the band during the period of his/her membership. For example, a member who joined at the CD Release Party on November 9th got the new album in its entirety, along with two songs originally slated for the album but cut during the mastering process. The band has plans to release a dozen new studio-quality singles in the next 12 months, along with an EP or two... and the member who joined on November 9th gets all of these songs. Furthermore, that member can do whatever he/she likes with the music, so long as it's not for commercial use. In the typical scenario, if a fan downloads a band's album and then distributes it on a peer to peer network (ie Oink, Napster, Limewire), if the band or its label was to find out, things could get ugly. Contrastly, in the case of the Backstage, the likely reaction from SoundRabbit would be a "Thank you!" in the downloader's email inbox. SoundRabbit believes that giving the music away "free" provides the best value for their fans, and that Backstage members should be allowed to do whatever they want [non-commercially] with the music that they own. "We're not selling CD's, and we're not even selling singles; we're not selling the music at all. We're building a community," says Jason, SoundRabbit's bass player. "And the community helps spread the word by taking the songs that they get from the Backstage and sharing them with their friends. With any luck their friends will dig the philosophy of the Backstage and become members themselves."
2. The "RBT Backstage" Vision: Give Back. Big.
"When we laid out the plan on paper," says Russ, SoundRabbit's singer, "we realized that programs like National Public Radio and PBS provided a great example for the content and membership-driven model. Members fund the ongoing work of the group, and the group in turn is tasked with providing great, fresh content for the membership. But perhaps more importantly, we realized that by generating revenues from memberships, we could make this thing a huge force for charitable contributions. Things like merchandise sales and iTunes sales that are traditionally the bread-and-butter revenue for a band can be leveraged for charity. The support of the Backstage members allows us to give back in ways that bands in the traditional model cannot." Indeed, at the CD Launch Party where the Backstage was first introduced to the public, the band donated 100% - every penny - of t-shirt sales from the night to the American Cancer Society. The Backstage website has a "Giving Back" section, where the current charitable project is listed with details about how Members can help contribute. "Our plan is to donate a full month of iTunes sales - 100% - to charity. We just need to get the new album up there and we'll get that project going right away," says Russ. "As the band becomes more well known, and the Backstage membership grows, we can easily envision giving thousands and tens of thousands of dollars to charitable causes each year. The whole thing is full circle, and everybody wins."
While the content on the Backstage will grow over time [that's the whole idea], the current content includes the full This Room Becomes A Crowd album for download in high quality MP3 and WAV formats, a section of live recordings in MP3 and FLAC format, a section of "Backstage Sessions," which are the aforementioned studio-quality singles produced by the band, a section of "Song Sketches," which are quick recordings of new songs/riffs/melodies that the band is working on; a full photo gallery with live shots, professional shots, CD cover art, posters, and more; a "Musician's Corner" with drum and guitar clinic videos showing how to play SoundRabbit songs, guitar tablature, lyrics, and gear listings; a message board where Members can interact with eachother and the band; a "Videos" section, with live show videos (the CD Release Party footage was up on the site the next day) and 'backstage' videos of the band behind the scenes; a "Special Events" section listing Members-only events and VIP access information for shows; a "Band" section with band member blogs and information; a "Video Messages" section where the band will create and send a personal video message on behalf of a Member to a friend/coworker/family member/etc. for a birthday, anniversary, gag/joke, etc.; and the "Giving Back" section, outlining the charitable projects the band is working on.
Incidentally, you can check out Michael Garfield's blogs and his MySpace page here:
The Visionary Music of Michael Garfield
Friday, January 25, 2008
Some of you are yawning. You've seen my friend Brad Feld's "treadputer," and mine looks lame by comparison.
Fast forward to 2008. I'm now 53 and carrying a chunk around my middle that I had managed to whittle away when I was in my mid-forties. This time the space is considerably less lavish. We're leasing a home in Boulder while our home on Mapleton Hill is renovated. Construction on that space won't begin for another few months, and I expect it will take at least a year. So the move in date is projected for some time in 2009. Ouch. By that time, without some regular exercise, I'd be pushing the obesity envelope. So I decided to do something about it.
But, then, I don't have a bathroom named after me either.
It's hard to keep up!
Section 5 of the report, pointing the way to the industry's future legislative and enforcement initiatives is particularly attention-getting in a Times Square billboard sort of way. Entitled "Time for Governments and ISPs to Take Reponsibility," and the sub-heading "Today, getting ISPs to help protect creative content is the music industry's top priority." The report states that
Internet Service Providers (ISPs) are the "gatekeepers" of the internet and have a vital role to play in curbing copyright abuse. They have the technical ability to do so, and increasingly the commercial incentives as well. The full cooperation of ISPs could lead to a very significant change in the music sector's ability to tackle copyright infringement while reducing the amount of litigation needed to deal with online piracy.No doubt. And the report goes on to sing the praises of France's President, Nicolas Sarkozy, who trumpeted an initiative under which ISPs in France would "commit to disconnect persistent copyright infringers on their networks."
A key question to be asked, however, is whether the copyright laws and the world/culture we want to create are actually served by this new music industry agenda. They would happily re-frame the traditional role of ISPs, making them the new "content cops," parked along the information highway. I'll be honest, something about this gives me the creeps. I've never been crazy about the RIAAs initiatives against consumers. But this strikes me as worse, by a lot. I don't want my ISP becoming a filter for content.
For those who follow these policy issues, I highly recommend the book "Wired Shut: copyright and the shape of digital culture" by Tarleton Gillespie. One great line from the book: "[w]hen content is locked and devices promise to love, honor, and obey their built-in rules, every use of a cultural work can be tagged with a price, and every right can come with a bill."
Technology allows us to do things today that we could hardly have imagined yesterday. And it hardly needs mentioning that not all the things we can do with it are good. Still, I want to emphasize that some of the things that technology can do to prevent illegal activity would create a world that few of us want to live in. Consider, for a moment, that it is probably quite possible for the government to insist that automakers keep all automobiles from going faster than 75 miles per hour. Or that it is also technically feasible to issue tickets to every driver each and every time his or her vehicle exceeds posted speed limits. That would certainly reduce or eliminate speeding, eh? Is that the world we want to create? And does it much matter whether the instigator of creation of this sort of world is governmental/public or corporate/private? One could certainly argue that the kind of tyranny produced by this approach is worse when it lies beyond the reach of the political process.
Incidentally, several digital music industry news sources followed the IFPI story with varying reactions, including Ars Technica, Digital Music News and Afterdawn.com.
Copies of the reports can be found on the IFPI site and at http://www.digitalmusicnews.com/stories/012408ifpi2.
"Mega-ISP AT&T Considers Less Dumb Pipes," January 9, 2008 http://www.
Thursday, January 24, 2008
Digital Music News reported today that Warner Music Group has set it sights (and its lawyers) on Seeqpod, the search engine that finds artists and mp3s, wherever they may be on the web, and dishes them up via a basic, but quite serviceable player.
Have you tried Seeqpod? What makes it particularly interesting, to me, is its ability not only to find and display mp3s of almost any track that comes to mind but to play it using a Quick Time player. That becomes particularly interesting if you're using an iPhone. Why? Because the iPhone doesn't support most Flash-based music sites. It does, however, support Quick Time. This means that iPhone owners can use Seeqpod to search and discover millions of music tracks and play them without having to pay a thing. No wonder the major labels are concerned.
And what about Apple? One might think that Seeqpod's existence would be especially problematic for the company that provides both the iPhone (that supports the Seeqpod search) and the underlying iTunes software that connects phone to computer to content. Paid content.
But maybe not. It has often been said of Apple that it makes far more from selling iPods and iPhones than it does from selling music. In theory, then, Apple might be more inclined to look the other way when an upstart like Seeqpod allows consumers to do with Apple's technology something the major labels never intended. But then, Apple has long played this game. When the major labels talk about fortunes being made on the "backs" of their content, they have a point. An iPod (or iPhone) would be worth a lot less in the marketplace if it could only play songs purchased via iTunes. But that isn't the case. Virtually any song downloaded from Limewire will play on an iPod. Or an iPhone. And that makes iPods and iPhones more valuable. Now suppose iPhones could also find and play almost any song ever recorded (via something like Seeqpod). Wouldn't that make each iPhone even more valuable?
So what's next? According to Digital Music News, Seeqpod contends that it falls squarely within the safe harbor provisions of the Digital Milenium Copyright Act. Maybe. I suspect that Seeqpod is hoping to benefit from Google/YouTube's vigorous efforts to support a very similar argument in their battle with Viacom. It will be very interesting to see where this goes.
Wednesday, January 23, 2008
You have to hand it to the crew at Last.fm. They did it. And they did it, really, before anyone else. The "it" that I'm referring to is free, ad-supported, on-demand streaming of music content that includes the catalogs of the major labels. iggli should have been there first. But we weren't. Dammit.
Last.fm, a UK-based company I began to write off after their purchase for $280 million by CBS, has managed to keep the goal in focus and get it done despite (or perhaps even, in part, because of) an infusion of significant corporate capital. And the folks at Last.fm most definitely deserve congratulations. [As an aside, that $280 million purchase price is particularly interesting. It's exactly the price I sold one of my previous companies, Service Metrics, for in 1999.]
Not that this means the game is over. On the contrary, it is just beginning.
Meanwhile, not everyone tells this story in the same way. The New York Times was full of praise.
Techdirt, in contrast, was almost uniformly negative.
But techdirt's sour grapes are mostly misplaced. Or perhaps Mike Masnick didn't take the time to understand what was "on offer" (as those over the pond might be inclined to put it). This certainly seems to be the case. He says:
It's so tempting to tell that story that everyone seems to be missing a few important details. Detail #1: It's not really free. Detail #2: It's nothing new at all. It doesn't let you download music. It merely lets you stream it. And, even then, you're only limited to 3 streams before you can no longer hear that song again without buying it. That sounds quite similar to the program that RealNetworks launched nearly three years ago allowing you to stream 25 songs per month for free. Or how about Napster's program, launched in 2006, which let you stream songs five times for free before asking you to pay up. If anything, the Last.fm deal, with only 3 streams, is a lot more limited than these earlier offerings.Oops. Mike seems to have missed a few salient points. Now it's true, the Last.fm "free streaming" has its limitations. That doesn't mean it isn't free. It just means that what's offered isn't everything you could ask for. Still, it's a damn sight more than what has been available previously without plunking down your stack of nickels - i.e., 20 nickels per track on average. OK, I think at some point in the future viable ad-supported music solution will eventually provide unlimited access to content. But just because the record labels (and Last.fm) have only come part way down this path doesn't mean they haven't come a worthwhile distance.
As for "merely lets you stream it," um, well. True. And unless you pay Real Networks an additional $5 a month, their Rhapsody music service "merely lets you stream" content. Millions of songs of content. Without the 30 second limitation - on almost every track - that handicaps Apple's iTunes offering. Now suppose Last.fm were offering millions of tracks of content. And suppose you could play any of those songs - or, rather, stream them via your computer. The catch? You can only stream any particular song three times before you need to pay for it (e.g., via a download from Amazon or Apple's iTunes). Sure unlimited streaming would be absolutely wonderful for the consumer. But the major labels are cautious. They're not going to agree to unlimited streams unless / until they are certain they have developed a viable economic model. (Never mind, for now, whether their caution will prolong their corporate lives or, more likely, hasten their much anticipated demise.)
There's more. One of the really interesting things about Last.fm has always been its social dimension. Unlike Napster, Rhapsody or even iTunes, the folks at Last.fm understand the wonderfully twisted byways that lead to a deeper, satisfying awareness and appreciation of music and all of its related elements. That's one of the most interesting things about Last.fm. Personally, I never believed this would survive inside CBS.
I could still be proved right. At the moment, though, I'm celebrating what Last.fm has gotten right, and hoping they (and others - particularly iggli) will soon demonstrate the ultimate social music network, something that would benefit both consumers and content owners.
He's right. It is a huge opportunity. An opportunity fraught, at this point, with both financing and execution risks.
What do we have to do to mitigate these risks? Well, first of all, we need to make certain our deals with content owners have terms that are workable for prospective investors. We're close. But we're not there yet.
Second, we have budding relationships with companies that will supply key elements of our model, including the music delivery mechanism and the advertising / monetization elements. We need to continue to develop and solidify those relationships.
We also have a growing blogging community, with bloggers in Los Angeles, New York City, Atlanta, Seattle, Boulder/Denver. These bloggers are amazing. They write regularly about music, social networks, technology and key issues facing the 18-24 year old demographic, and they do in ways that are often moving and nearly always entertaining. A couple of examples chosen at random from the list of recent posts:
Stripper Name Woes (In which blogger Rhythm and Kaos grouses about Facebook's stripper name application when she receives the, um, less than sexy handle "Trixie Slidehips.")
Strange Days (From blogger Etta Strange, who has a wonderful way of connecting today's music with the classics of yesteryear, in this case, the Stylistics "People Make the World Go Round," a marvelous pop standard written by the famous dynamic duo of black pop songwriting, Thom Bell and Linda Creed.)
We need to extend the reach of our blogs, grow our audience among 18-24 year olds in particular, and refine the way we deliver content in terms of both form and substance. I expect, for example, to be able to deliver iggli blogs do mobile devices, but more than that, I expect that iggli will be able to encourage microblogging about music, social networks, technology, and (you guessed it) the issues of the day. I think Oatmeal has the right idea when she compares blogging to "My So Called Life." At iggli, we're working on ways to encourage people to connect and express themselves day in and day out. Even minute by minute. (Which reminds me of a song.)
Tuesday, January 22, 2008
I'm going to try something a bit different. I'm going to post for the next five days straight. Today is Tuesday, the 22nd of January. So, today through Sunday the 27th, I'm planning to post every day. Hell, I may even post a few times a day. And the point? I need to reestablish my blogging routine. And now is a particularly good time. Things here at iggli are kicking into high gear. I'm beginning to raise a substantial round of capital. Beyond that, I'm selling the house in Maine, and other than that I'm focused on technology and digital distribution in the music industry, the renovation of our home in Boulder (while we continue to lease from our dear friends, Howard and Elizabeth), our kids - 3 of 4 are currently in college - and the future (including a world in which George W. Bush is no longer President of the US).
So why the blog title "Transparency?"
I had a great meeting yesterday with a friend, a fellow entrepreneur who is in a remarkably similar situation. He and I both have consumer-oriented startups. Each of us has had significant entrepreneurial experience in the past. Each of us has enjoyed substantial success in our previous tech ventures. And each of us currently faces a huge set of challenges moving forward.
We each have companies; employees; a substantial vision of our product/service. As we talked about our respective circumstances, the conversation began to encompass the blogs that each of us maintains (or, in my case, fails to maintain). I asked if he was blogging about his company. He responded (as I might have) that it was difficult to blog when things are, well, difficult.
I understand completely. And I also realize (as I suspect he does) that the things that are difficult are the most interesting to anyone reading the blog.
Sooooo. In the interest of transparency and gerating a little interest, I've decided that I will err on the side of full disclosure. And begin to talk about what's actually happening here. I suspect that will be far more interesting to most people than posts of the the views from my NYC hotel rooms.
More tomorrow . . .