Google yesterday announced Play Music All Access, a music service with subscription features that competes with Spotify and Rdio — building on Google’s existing music store and cloud service that competes with iTunes and Amazon. That’s a compelling mix of features, but Google still faces plenty of challenges as it attempts to establish itself as a credible competitor in the rapidly changing music space.

“For now, we have a version 1.0 of what’s possible,” Google Play lead product manager Paul Joyce told The Verge. “We had a vision and it’s taken us time to build out that vision. We look at All Access as a complement to the locker, which we felt we had to build first.”

“WE HAD A VISION AND IT’S TAKEN US TIME TO BUILD OUT THAT VISION.”

But while the streaming service came second, it’s clear Google felt pressure to enter the subscription market as consumer music spending shifts. “Music subscriptions are the fastest growing segment of the music business,” said Joyce. “There are people who will always buy music, and people who will always rent. Increasingly there will be both.”

The combination of a store, cloud storage, and streaming service means that All Access is currently unique in allowing customers to browse, play, and manage both purchased tracks and subscription tracks in a single unified interface — something that no other service currently offers. “You can see how a subscription model works with your own personal collection, and if you like it, we would love for you to pay $9.99 a month,” said Joyce. “But if you decide you don’t need all that music, your going-away prize is a free level of service where all your music is safe in the cloud.”

That’s a pretty good deal, and it gets better if you sign up before June 30th — the price falls to $7.99, although Joyce wouldn’t say if it would ever go up again. “It’s $7.99 a month,” said Joyce. “Forever and promises are difficult. But people have the same question about our free music locker.”

But getting people to take advantage of that deal won’t be easy — especially since Google seems to be artificially limiting its potential market by keeping Play Music safely within the boundaries of its own ecosystem. There’s no iOS app, for example, and social integration is limited to Google+ — even though Spotify famously received a huge boost in users by integrating with Facebook. In an increasingly multiplatform world, a music service that only works in the US on a single platform and doesn’t allow for seamless sharing seems seems destined for niche status.

“I THINK WE’RE JUST GETTING STARTED.”

But Joyce said his team is exploring all their options. “We’ll always evaluate other platforms and other opportunities,” said Joyce. “Our general goal is to have everyone use our service. I don’t think it should be a requirement that people have a specific piece of hardware to use our service — that’s not a strategic aim. I think we’re just getting started.”

Joyce also hinted at future integration with YouTube, which has turned into a dominant music service in its own right. “YouTube’s hugely successful and we’re all part of one company,” he said. “Can Google build something better that involves aspects of YouTube with things that Play is doing? I think that’s something we’re all aware of, and directionally that’s likely.”

Source: The Verge (by Nilay Patel)

Spotify’s quest for world domination is continuing.

The top on-demand, streaming-music service is set to launch in eight new markets, including Mexico, Hong Kong, Singapore, Malaysia, the Baltics, and Iceland, according to a person familiar with the situation. The rollouts could come as soon as tomorrow.

Adding territories has been a top priority for Spotify, which is racing to boost its user base. Spotify, which launched in the U.S. just over a year and a half ago, now has 24 million active users, 6 million of whom are paying subscribers. It’s become the fastest-growing digital music company ever, and is second in reach only to Internet radio company Pandora. With the additional markets, Spotify will be in 28 territories in all.

Growth is key for a number of reasons. The company is trying to negotiate better terms with the music labels, which earn the bulk of every dollar — roughly 70 percent — that Spotify brings in. The more Spotify is paying to the music labels and publishers, the better its position at the negotiating table. Spotify is already the label’s No. 2 source of digital revenue behind Apple, and CEO Daniel Ek has said his company is on track to pay rights holders $500 million this year alone — the same amount the company paid out in total since launching in 2008.

Yet competition is growing — and fast. The big tech titans — including Google, Apple, and Amazon — are all gearing up soon to add streaming-music services of various sorts. So the quicker Ek and his team can open new markets and build the brand, the better.

Adding new markets requires its own set of negotiations. Each new territory requires new deals with music rights holders, something that Ek has said is Spotify’s biggest limiter to growth. In addition, these new services — both for mobile devices and PCs — will be in local languages.

Spotify has amped up its marketing efforts in recent weeks as it seeks to build its name among mainstream music fans. The company last month launched its first-ever TV campaign, and last week it rolled out an ad across the top of YouTube, which has become the go-to site for young people to listen to music.

Source: CNet (by Paul Sloan)

Google’s YouTube, the entertainment industry’s longtime “frenemy,” is emerging as an important component of record label plans to adapt to consumers who are taking their music mobile.

A part of the streaming-music service that Google is aiming to launch this summer is a new YouTube product that would be designed for the desktop and mobile devices, according to a person familiar with the negotiations between Google and the major labels. Such a mobile offering, coupled with the powerful YouTube brand, could ignite the nascent streaming-music business, now led by Spotify for on-demand music and Pandora for Internet radio.

Warner Music Group inked a licensing deal with Google late yesterday, and talks continue with Universal Music Group and Sony Music, according to sources. The negotiations are part of a broader discussion between Google and the labels about launching two types of streaming-music services — one that’s part of Google’s Android music platform, Google Play, the other that’s part of YouTube. The broader plan, first reported last month by the Financial Times, was spelled out yesterday in a Fortune article.

YouTube music for mobile would include a combination of free offerings and subscription plans, sources said, though what the product would ultimately look like is still unknown. Some top music execs say they have yet to see it, and deal-makers are working out just what and how much should be available for free to consumers. While it’s logical to think Google is trying to bolster its dominant Android business, music industry sources say Google is pitching this as a service for all mobile platforms.

If YouTube gets the rights to offer a powerful free streaming service on smartphones, it could be a game changer for music streaming. Streaming services accounted for an estimated 10 percent of all digital music revenue last year, according to a report released last week by the International Federation of the Phonographic Industry, and the music labels are banking on rapid growth. (Importantly, streaming has so far not hurt purchases on the dominant Apple iTunes Store, according to people at the labels.)

Google is digging deep to court the labels. Part of what Google is offering is to pay a fat, upfront fee for rights to their catalogs, according to a source familiar with the talks. Google, of course, has plenty of cash, and unlike the independent streaming services, it can afford to cut less-favorable deals upfront, since selling music isn’t its primary business.

A YouTube representative didn’t respond to questions about the potential mobile offering. YouTube confirmed in a statement that it’s exploring the streaming business, saying that “there are some content creators that think they would benefit from a subscription revenue stream in addition to ads, so we’re looking at that.”

Only Spotify subscribers can call up music on their phones — for now.

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The Galaxy Nexus and Ice Cream Sandwich are nearly upon us, and one feature that’s widely expected to be introduced alongside their release is a Google Music store. The current beta of Google Music functions mostly as a dumb music locker in the cloud, but there’s already been evidence that Google’s planning to expand its functionality and turn it into an actual store. This weekend has seen more kindling added to that fire with a set of purported screenshots from that very Google Music store.

Claimed to have been obtained using an HTC Inspire 4G over in Venezuela, these screen grabs provide a hint of what the eventual store experience might be like. The most apparent highlight is a “Free Song of the Day” spot that does what its name commands, while there’s also mention of Android Market and Google Music working “hand-in-hand,” most likely referring to the purchase of music. So the way things are shaping up, the Android Market looks likely to go the way of iTunes in being the place to get both your apps and music. Per-track pricing varies, with $1.29 and $0.99 prices visible, and full album cost will also depend on popularity, it seems. The ability to purchase anything hasn’t yet been enabled, we’re told, but Google’s “These Go to Eleven” event on the 16th will very likely flip that switch while filling in any remaining gaps in our knowledge.

Article originally appeared on The Verge (http://www.theverge.com) and was written by Vlad Savov.

Today Google officially launched the long anticipated Google+ Pages, which finally gives bands, brands and businesses an equal footing on the social network.  There’s a slightly confusing two button system:  fans can  recommend you with a +1 or add you to a circle to have your updates appear in their stream. Google has also integrated search with  two ways to add pages to circles from Google search.

The first way to add pages via search is by including Google+ pages in search results, and the second is a new feature called Direct Connect. For example, maybe you just heard that your favorite band is coming to town. with Direct Connect search for [+], followed by the page you’re interested in (i.e. +AllAmericanRejects). Google will take you straight to their  Google+ page, and if you want, we’ll add them to your circles.

In fact, Oklahoma rockers All American Rejects are Google’s example of a band using Pages.

Google+ Pages is rolling out over the next few days, and you’d be smart to grab you band or brand name asap. 

To the cloud. Google’s created MUSIC, a here-to-fore hush-hush (though everyone seemed to know about it) service to shunt all your music up to a locker in the cloud. Apple will soon have a Cloud iTunes too. Then you can play your music everywhere and anywhere on just about any device that the gods of I.T. allow it to. Though, right now Google’s only on Android and Apple’ll probably stick to the iPhone. 

Here’s the best part: You may be able to share your music with your friends, family, step-children, and even ex-significant others. There will be an App for that. Maybe.

I am keenly sure there are some Business Affairs people with legalese at the aim, ready to shoot these ideas out of the sky, or try to. I would think that Google and Apple are fending their way through the music industry to glad hand and make friends—the usually business dance of flirting with deal terms, bluffs and counter-bluffs and name calling when no one dances—in order to try and get these services to be all they can be, with all the legalities in place, dotted “i”s and all that, but like Napster and previous ventures in peer to peer, there are those in the music industry who want these things dead, doubly dead. Kicked in the head, dead. (Of course with Apple throwing its weight around like they usually do, maybe they’re not glad-handing, more like strong-arming.) To me, they are all going to miss out on a key tool that will help them to both make more money and help artists and entertainment conglomerates sell more downloads and albums than ever before, and especially more tstochkes for all those 360 deals they’ve hammered out, and heapings of more tickets, especially those VIP concert tickets where you can “possibly” meet Britney’s backup dancers for a cool thousand. 

Face it, the people who run this business of music—those who really run it from their offices high above the fray, poring over contracts, tallying up profits, explaining away losses and fomenting lawsuits—are not hardcore fans of music. Heck, the suited and proverbial THEY, while they may like music, the fandom’s been drained from their blood by now. Music is something they listen to in order to figure out the next percentage point gain to their salary and their artists’ income. They don’t even pay for their music. They are comped with freebies, swag, and, horrors, THEY GET FREE INTO BEST SEATS AT CONCERTS. 

I know I’m going to get crap for that one paragraph, but as one in the industry I know of what I speak: most, yes not all, of the professionals in the music business that I rub elbows with in my day-to-day are not true musical fanatics. They are at gigs because they have to be, like the wahoos I stood behind at a very intimate Elvis Costello concert at Gerde’s Folk City in NYC ages ago. I knew who and what the wahoos were and they were very successful dudes in the business. I wish I could have had their jobs and salaries, but not their sense of fandom. They did not shut up once while Elvis was doing a historic concert right within 50 feet of their banter. If I had a knife… Oh, the proverbial THEY profess to be music fans, like all the business affairs people at Rykodisc that I worked with, who really knew the who, what, where and why of our eclectic catalog. Don Rose, one of the founders of the label, ran a record store in his youth. Who else but a fan would even dare negotiate the rights to the Frank Zappa catalog when everyone else in the business saw those masters as equal to a soon-to-be-dead mobster, a great big fat liability, and viewed any negotiations with FZ and the gang, as those lead weights helping bring their whole enterprise quicker to the bottom, with a massive amount of returns and ill-will.  Only a company of fans would even dare to move ahead. Rykodisc did and became a successful enterprise able to go on to David Bowie, then Elvis Costello and others. I, myself, am a great fanatic who spent hours poring over lyrics in the depths of my room—back when you could read lyrics on a 12x12 inch inner sleeve—while my dad told me to turn down the FZ on my stereo, but all of us in the business have to come to the realization: we are not like the music buying public. Because we don’t really buy music, we’ve left our fandom behind. It’s our business, not our hobby.

Which is why the suits will expect, or need to make, the full sale at all costs, while not fully understanding the buyers and the inner workings of their minds and how they consume, and possibly, hopefully, purchase music. While I knew the workings of the suits from my days of being one at Rykodisc, this was excruciatingly painted out in broad strokes when a crew from Universal came to iCAST—the imploded CMGi entertainment website of yore—to present us with their vision of the pay download future. After the whizbang powerpoint deck, I asked what was their pricepoint for a single download? They noted, with all the legalities and costs, and royalties and such, they could not make a profit unless they hit around $1.35 or so. My memory is hazy here, it could have been higher, although I know it was not that much lower as I then noted to them that they would have to hit under 1.00 in order to lure the public into their fold. Since they were not getting the physical product, consumers needed the perception that they could get an albums’ worth of tracks for UNDER the cost of a full CD. The brightest minds in the bunch reminded me that included in the price WERE the extras of photos, liners, lyrics, yadda and yadda. They didn’t get it. That extra stuff was all well and good, but it was the final price that would induce the sale of such an ephemeral product as an Mp3 file, no matter how filled with additional geegaws. Where is Umusic’s download platform and where is Apple’s iTunes? And at what price point did iTunes launch? One penny under a buck. Not that I’m a genius—and neither was iTunes—they just understood the fan mentality. Fans needed the price to be 99 cents. The suits only saw the way to the full sale, the optimum profit, and couldn’t go any further than that. They ended up yielding the floor, and the bulk of the revenue, to Apple and iTunes.

It is understandable why Record Companies look at the back catalog as revenue, since they financed the creation of said items, many of which have not returned a profit, yet. But in looking at these pieces of product, they don’t understand how essential this music is to the music fanatics well being. In a weird way, they do things ass-backwards in order to create revenue. They don’t release back-catalog, they don’t license tracks for compilations (don’t get me started on this one, I have a few good stories if you want to buy me a coffee), they don’t  reach back there into the vaults to really see everything they have and figure out how to get it out here to the music-buying public. I’m not talking the back-catalog of the known entities of rock like Supertramp or Olivia Newton John. Where is “Split” by The Groundhogs? A tour-de-force I wore my headphones out listening to in Jr High.  Or “We & The Sea” by Tamba 4? This was a little Brazilian Jazz something I found in the bins after being hipped to Creed Taylor and his CTI records by my Jazz friends. 

Where can you find them? Nowhere.

Why do you think fanatics search out torrents? Why do you think Napster was such a success? These criminals want their music and will resort to downloading it illegally because we, in the business, are not giving it to them in the way they want it. Yes, there are those who will never pay for their music, and guess what? They WILL NEVER pay for their music. But how can you download a tee-shirt, a live experience, even an artist mug with a bag of their favorite artists’ favorite grind of coffee? You don’t sell those criminals up the river; you sell them the proverbial bill of goods. Okay, you can slap their wrists with a ruler if you want.

Napster would have been a fantabulous tool for finding out fans and their networks of friends: who was sharing what and how much and to whom. A treasure trove of data. Yes, it was peer2peer illegal swapping of copyrighted materials and I would think that the minds that put a man on the moon, or made it so simple that the grandparents of my kids—my 91 year old dad and 88 year old mom—could figure out how to get a Facebook account, those geniuses should be able to derive a system that could create revenue for all concerned. Not a full sale, but revenue. But the dang (insert a stronger word here if you must) BzAff departments are either hampered by the corner-officers, or they wear a mighty big set of britches and are looking for a full sale. Remember, the bulk of people who were on Napster were never going to buy the music, or couldn’t find the music they could buy. Either give them what they want—free music—or forget a full sale. 

Big Music Label, consider this kind of service, the Google/iTunes cloud music thing (awaiting cool marketing term to insert here: Googlishous? iCloud? iPlay? goPlay? uPlay? weallPlay?) as a marketing tool. And not only that, this could be a piece of marketing that pays for itself. Someone at Rykodisc once told me, “a fan is someone who owns three albums by an artist.” Our mission was to get the next album into their hands, and get them to concerts, and keep them engaged so they keep coming back for more CDs. If you can find out the “Connectors” (as from Malcolm Gladwell’s “Tipping Point”), which would be the fans with the most-est shares, with so many friends checking out their music, you have found the way to penetrate great swaths of the music buying public. You’ve found the fans and you’ve found someone they trust. You should be making friends with connectors, not impeding them. Open up the hood at these services and you could find the whole series of movers and shakers key to Gladwell’s three rules of change in the tipping point of epidemics: the Connectors, the Mavens, the Salesmen at work. Get the webbies to write up some cool software and you could see all of this in action, in real time. You would see the fans you should know better, the ones with three or more albums by your struggling artist. Not hypothetically in a generic grouping inserted into a marketing plan. There, right in front of your face. Interacting with other fans of other artists. In real time! Sell ‘em a Tee Shirt!

As I’m not privy to information being discussed at the high-level meetings by the Music Suits and the Web Suits being held to discuss these services, I can only predict the worst. Music BzAff will hold out for strangling the service before it can gain momentum and go passed the tipping point. And, most undoubtedly on the other side, Web BzAff will hold out for some other stupid stuff that BzAff people hold out for. BzAff just does these things because they know how to do these things and they get their jollies, and their paychecks, by doing these things extremely well. 

When we were trying to compile some esoteric Nonesuch track for some not-quite-so-esoteric Rykodisc compilation, the guy on the other end of the phone at Warners, who wore some pretty big britches, guffawed and said, as I recall; “for that kind of money, I don’t get up from my desk to even find the file.” In other words, our spare change of a few thousand didn’t smoke his shorts. One could counter that having the track on an album that we were going to market could have given interest into more of the Nonesuch back catalog and driven more sales of that. One could if one didn’t mind another round of guffaws. I could see their point then, this was before iTunes and downloads. But even today, Big Music Co is not considering the whole picture. A few weeks ago I was told that Big Jazz Label had a whole warehouse of masters not finding their way to iTunes. I gave Big Jazz Label a handy idea that would again, be a kind of marketing that paid for itself—although they would have to shell out the shekels to start the campaign. They came back with, what I would term, a short-sighted reply; they would be most interested if someone licensed the material to do the same thing. Yeah, sure thing, invest in a product that is going to just about turn a profit, but makes someone else a handsomer profit as free marketing for their back catalog. Like my Dad would say, “If you like that, I’ve got a bridge in Brooklyn you might be interested in.”

As a marketer, I would love to be able to use the backend of these services to triangulate fans; fans of A who love B could also love E, and then find ways to pull the fans of A + B to be interested in E. Other parts of the industry—Merchandisers, Concert Promoters/Ticketing, Artist Managers, would gladly (okay, begrudgingly) pay to use this service to peer into the musical buying habits of the members. We treat the music buying public as homogeneous groups, cutting and slicing them into distinct segments so we can market to them. If we had that software, I noted above, during the days of Napster we could have seen odd pairings we could have explored and exploited: fans of A level artists also love B and C level artists of other genres, if you know which ones, then you know how to get more sales of the C level artists; or which C level artists should go on tour with which A Level artists and then really help sell more tickets for the tour. There, I thought of that in under fifteen minutes. Put the Brightest Minds in the Biz in a room to white board it out and you could have a few hundred ways to create B2B revenue from this service; cold cash which could help pay the Big Labels their due. And Big Artists could siphon something off the top to make themselves happy. But, I’m guessing both BzAffs will start at the top, with all expecting their best percentages out of the deal but ending up with an untenable solution, like the pay-outs needed to the Grannies in “The Producers.”  

So here we go again. It’s going to be interesting to watch how these Cloud Music Sharing services wind their way through the BzAff wranglings. Over the years, I’ve seen BzAff at their finest and this is surely going to be some kind of show, even from the outside. Unfortunately, I think everyone is going to wrangle this thing so much it may not survive. 

One more story to end this on even a lower note. Henry Frayne, one of the artists I product managed at Rykodisc, went through a bitch of a contract negotiation with our BzAff team. Back and forth the paperwork went, until one day Henry was given “congratulations” for having the lengthiest negotiation in the history of the label. This seems ridiculous. Instead of shoving all sorts of “zingers” into the contract in order to be taken out when noted by other legal experts and lengthening the process, it should have been cut and dried. If the record went on to sell zillions, Henry would be renegotiating the contract anyway and it would make sense to spend good money after good money to work on renegotiations. If it flopped, then all that time in Zingerville was wasted. Henry’s wonderful and dreamy soundscapes entitled “Lanterna,” sold moderately well. (With marketing senses still intact, you should all check out on iTunes right now.) Then Rykodisc was sold to Palm and I was out of there. The zingers still embedded into the contract also denied Henry from making any additional albums for a certain number of years. If you pause to think about this logically, this was a stupid thing for Henry to sign (Henry!) and for Rykodisc to want at all. More albums by Lanterna would have given more exposure to, and interest in, his back catalog—our one album, owned by Rykodisc then Rykodisc/Palm, and now the legalities embedded in the contract lay in some dusty box somewhere in the mighty Warner Bros basement. So they/we cut Henry off from his making more of his music to spite their bottom line. 

I believe all the parties involved with the different Cloud Music Sharing Schemes will do the same. They can’t see the possibilities, only the loss of revenue. But without the possibilities, they will lose revenue.

Article originally appeared on Music Think Tank (http://www.musicthinktank.com/) and was written by David Greenberg.

We can all stop waiting for the “new music industry” to arrive.  The new music industry is not coming, it is here already.  The only thing that will change is change.  New models reshaping the way music is marketed and distributed will continue to change the landscape, and there will be many.  Right now we have an emergence of abundance within the music industry. There are countless new artists emerging and the same goes for the ways of consuming those artists.  This will not change; the emergence will continue to evolve as humans will continue to evolve.  With that being said, there will be a shaping and weeding out process.  The shaping and weeding out process will define which artists and which models work best for you individually, the consumer.  The process of definition for the music consumer will cross all boundaries including race, gender, and age.  I would like to include money, but I can’t help but to imagine the rich kid who only wants to see their favorite artist live, so they pay for live shows whenever they decide to.

The music industry of yesterday consisted of great control.  If one could just control the few available key aspects, they could and have controlled the market.  Distribution in the days of music consumption yesterday consisted of record stores.    This is something that I am very fond of, as I remember being a kid working in my grandfather’s record store in Northern New Jersey.  I remember the days of going to one-stops in Brooklyn early Saturday mornings and rushing back to New Jersey to make it in time for opening.  The distribution dollars still led back to the same few places.  Huge media conglomerates controlled distribution channels and consumption channels through radio, tv, and later on portable devices.  This took MAJOR funding.  It was unthinkable to go against these conglomerates in this state of the music industry.  The costs of producing, distributing, and marketing a record were extremely expensive.  Even if you had the funding to produce a record, marketing and distribution channels were still tied up with the large media conglomerates.

With the emergence of new music technology, the scope has broadened on all levels.  Technology has made way for new opportunities, thus creating new models.  The internet has eliminated a lot of past costs within the music industry; this goes for the way music is recorded, the format of music, the marketing, and especially the distribution outlets.  New models have taken away the control aspect.  A child can be born, grow up developing their musical talent, gather people who can assist in the process, record an album, market that album, distribute that album, get paid, and repeat the process over and over without ever dealing with a record label for their entire career.  And that’s just the basic capability of an artist operating in today’s music industry.

Right now we are looking at three entities that are battling in the “Who’s Going to Shape the Music Industry Showdown.”  None of these entities are record labels; in fact they are all technology companies.  They are Apple, Amazon, and Google.  Does this spell doom for major record labels, I doubt it, but who knows?  That’s the beauty of the current state of the music industry.  It is imploded with an unforeseen greatness of potential.  In the coming days, we will see artists partner with entities that we never would have imagined, in fact it’s happening now!  Incredibly amazing talents that we never would have heard of in the days of yesterday now have a shot.  Sure there will be lesser talents also with opportunities, but if you don’t want to listen to them DON’T.  You now have that power in today’s world.  The control of the experience has returned to the user, where it should have and always be.  So has the music industry changed from what we once known?  YES, and it will continue to change, but you will hold the reigns.  Follow the technology at your own discretion.  The new music industry is here, and from the looks of it, the new music industry will always be here. 

Article originally appeared on Music Think Tank (http://www.musicthinktank.com/) and was written by Taurean Casey.