On the heels of Google wading into the music streaming waters with its Google Play Music All Access service, with a $10 fee for all-you-can-eat streamed tracks, the indie music agency Merlin has today published results of a recent survey of its 20,000-label member group, plus an analysis of 6.5 billion music streams over the last year, which spell out where the money is coming from today. Streaming services are making increasing headway as a revenue driver for musicians, but digital downloads — specifically Apple’s iTunes — are still ruling the roost.

Worldwide, iTunes has held on to its spot as the single-biggest source of revenues for Merlin’s independent label members, both across key markets like the U.S. and UK, as well across Europe and globally. Interestingly, Spotify is securely in second position, underscoring just how popular both Spotify and streaming services  have become — second has been a place held by Amazon for some time prior to this. Amazon’s MP3 download service subsequently slipped down to third place across the board, while Deezer and eMusic are split regionally in terms of their influence and in grabbing fourth place.

We’re reaching out to Merlin to see if we can get a specific percentage breakdown here. Typically iTunes has been estimated to hold around 60% of the digital music market by revenues; NPD put its share at 63% in April 2013. (Update: A Merlin spokesperson says those breakdowns are not being disclosed.)

“The new generation of digital services has created a new dynamic of consumer freedom, limitless choice and myriad paths to discovery,” Charles Caldas, the chief executive of Merlin, said today in a speech at the Great Escape conference in Brighton. “Our numbers illustrate that this dynamic is bringing incremental value to the market, and the demand from music fans for the music being released by our independent members is higher than ever before.” However, in what might be a swipe not just at big labels but big players like Google jumping deeper into the market, he also cautioned against companies that might be trying to apply legacy music royalty concepts to digital.

“The ecosystem is fragile: power is more concentrated than ever, and we are seeing an attempted land grab by the largest companies for digital market share as they try to recreate the old-market advantages they are clearly losing in the digital space,” he noted. Merlin, despite its tens of thousands of indie label partners, only makes up about 10% of the world’s music market, so it has a place continuing to rage against the machine.

It will be interesting to see whether Spotify’s (and streaming’s) rise are eating into that 60% marketshare for iTunes. But the research from Merlin suggests that if this is the case it’s not a watershed moment quite yet: both formats appear to still be growing, even if streaming is growing more.

Some 92% of respondents in the survey said that streaming and subscription revenues (based on streaming) grew in 2012 compared to a year ago. One-third said the rise was as much as 100%.

The rise in downloads was less pronounced: around 66% said a-la-carte download sales grew alongside that streaming rise. Only 8.4% said the rise in download revenues increased by 100%.

In terms of what the growth in streaming means for actual businesses, the takeaway is still marginal.

Merlin’s members say that they expect royalties of $65 million or more for 2013 from streaming services, but if you just do the math and divide that among 20,000 members, that works out to only $3,250 per label. Considering that Merlin claims that its members’ share of streaming services is typically 12-20% higher than those of other major labels — included in Merlin’s counts are acts like The National, Grizzly Bear and Bon Iver, as well as labels like Domino and Beggars Group — it sounds like streaming, despite all the advances and popularity, remains for now just an opening act, and not the main event.

Full results of the report can be seen here.

Source: TechCrunch (by Ingrid Lunden)

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)

In 2011, a proposed class action lawsuit was launched against Universal Music Group over digital income. The litigation from Rob Zombie and Rick James on behalf of themselves and others under the UMG umbrella seeks substantial damages from the record label’s decision to treat income from downloads off of venues like Apple’s iTunes as “sales” instead of “licenses.”

Just how much money is at stake is an open question.

The lawyers representing the plaintiffs want UMG to turn over download revenue and volume data tied to particular artists so they are able to come up with a calculation of damages and order the information in an effort to gain class certification.

But UMG is telling a judge that’s not reasonable, and if it happens, the privacy of artists will suffer.

The current litigation, in many ways, is a follow-up from a path-breaking 2010 ruling by the Ninth Circuit Court of Appeals over a dispute pitting Eminem’s production team of Mark and Jeff Bass against Eminem’s record label, Aftermath (a subsidiary of UMG). At the 9th Circuit, the judges ruled that a lower court had erred by not deeming the label’s agreements with third-parties download providers as licenses instead of sales.

The attorneys for other UMG artists want to repeat the success, which would entitle these artists to collect about 50 percent of collected digital revenue instead of about 15 percent.

But this case is somewhat more complicated given the potential number of artists who have contracts with UMG. Not every artist has precisely the same contract. Not all artists enjoy the same level of success. Commonality is one of the factors that a judge will consider when deciding whether or not to certify a class action.

The plaintiffs’ lawyers think that having access to data will help them sort through the issues in preparation for certification. And they’re not willing to settle for data that leans on anonymity such as “Artist #437 had 1000 downloads and $785 in download revenue in 2005.”

The plaintiffs are willing to designate the information potentially handed over as “Attorneys’ Eyes Only,” but UMG is objecting with a noteworthy argument on “third-party privacy interests.”

UMG says that “the issue’ here is that the plaintiffs’ attorneys — “all 50 or so of them” — do work in the music industry. UMG lawyers stated in a court filing on Friday, “Under plaintiffs’ proposal, plaintiffs’ attorneys and music-industry professionals could review the private financial information of thousands of recording artists with whom they may have adverse relationships, and who have not indicated any desire to be part of any class or to be represented by these attorneys or professionals.”

In the case involving Eminem’s music referenced above, UMG asserts that “when plaintiffs earlier sought private download data for just a single artist, Eminem… he strenuously objected, and was prepared to intervene until Plaintiffs agreed not to seek such data at all.”

UMG also believes that the “true, disguised purpose in seeking the artist names is to help evaluate their case for settlement purposes.”

Nonsense, responds the other side.

According to the court documents, the plaintiffs tell the judge, “It is ironic that UMGR continues to press for more information about how Plaintiffs will calculate their damages, but seeks here to deprive Plaintiffs of important data Plaintiffs can use both for internal analysis of class certification theories, and to illustrate for the Court available methods for calculating damages for any class or subclass. Plaintiffs should not be handicapped in these tasks.”

Source: Billboard (by Eriq Gardner)

Those past the age of 25 may find it hard to believe, but April 28 marks the ten-year anniversary of the iTunes store. Over the past decade, Apple’s groundbreaking online marketplace solution has transformed the way we purchase music.

Believe it or not, Apple’s iTunes Music Store turns 10 this weekend. Although iTunes has in many ways been a godsend to fans of digital music, it has been a source of endless frustration for the music industry.

Since the introduction the iTunes Music Store on April 28, 2003, music sales have plummeted in the United States — from $11.8 billion in 2003 to $7.1 billion last year, according to the Recording Industry Association of America. When adjusted for inflation, revenue has been more than halved since Apple launched the iTunes Music Store.

Interestingly, during that same time, people have been buying more music than ever. How is that possible? It’s because the iTunes Music Store popularized the cheap digital single.

After manhandling the major record labels during a series of now-legendary negotiations, then-Apple CEO Steve Jobs was able to initially offer digital albums for $10 and any individual track off that album for 99 cents.

That changed the music industry forever. When music sales reached their peak in 2000, Americans bought 943 million CD albums, and digital sales weren’t even a blip on the radar. By 2007, however, those inexpensive digital singles overtook CDs — by a wide margin — generating 819 million sales to just 500 million for the CD.

Last year, there were 1.4 billion digital singles sold, dwarfing CD sales by a factor of 7. More than three-quarters of all music-related transactions were digital singles last year, according to the RIAA.

Apple’s iTunes is behind that sea change. According to NPD estimates, iTunes is currently responsible for 63% of all digital music sales. Even after the emergence of competition from Amazon and Google.

The popularity and ease of downloading cheap digital singles has transformed the industry. Not since the vinyl era has the single been this popular. The smaller, cheaper “45” record dominated music in the 1950s and ’60s, but the music industry wised up in the ’70s.

Vinyl, cassette and CD singles were always cheaper for consumers, but manufacturing costs were not. Nor was the space required to house them in stores. Thus, the single became harder and harder to come by.

The reality is if singles were as available a decade ago as they are now, they would have been just as popular. Music nerds notwithstanding, the average music listener has really only cared about a few tracks off an album at most.

So how was it that the iTunes Music Store, with its proprietary file format and limited device support, that led this charge?

By the time the iTunes Music Store arrived, the iPod was well on its way to becoming a run away success, which meant that Apple already had an installed base of customers using iTunes.

Competitors, such as Rhapsody, were mostly concerned with streaming music. Most crucially, their files weren’t designed for use on the iPod, let alone most other MP3 players.

Without the iPod, iTunes and its music store were seemingly innocuous. But the magical combination of buying a song instantly and taking it with you anywhere gave music lovers a good reason to ditch the CD.

Can music sales ever come back? Likely not, says NPD analyst Russ Crupnick. He believes musicians will have to increasingly rely on touring, merchandise sales and endorsement deals to make up for lost album sales.

The subscription streaming services of Spotify and other music apps could help bolster the business, Crupnick says, but the thought of those bringing the industry back to its former peak seems lofty.

Ironically, it could be Apple that is in danger of losing its grip on the music business. Whether or not Apple can maintain its relevance in digital music could very well depend on its ability to transition to the streaming subscription model, which is rapidly adding users.

Nevertheless, the iTunes Music Store’s effect on the way people buy music over the past 10 years has ensured that the music industry will never again be the same.

Source: CNN Money (by Adrian Covert)

ThingLink, the most popular interactive image platform for publishers, brands, agencies and consumers, today added interactive image sharing to Facebook Timeline.  Now when publishers share ThingLink interactive images to Facebook, viewers can ‘touch” them to experience the content inside the image — without leaving Facebook.

ThingLink’s proprietary, patent-pending web-based solution allows publishers to create, tag and share any image, in any environment, quickly and easily. ThingLink allows content producers to better understand how their images are being used by consumers on the different social media platforms, both in terms of interactions with the image as well as a wide range of social behaviors.

Publishers and individuals can now use ThingLink to transform static images on Facebook Timeline into a discovery experience — with music and video players, social links and brand content that appear inside an image when it is “touched.” Rich media tags from services like Youtube, Vimeo, Instagram, Imgur, Flickr, and Twitter are supported from the beginning, and support for custom third-party tags will be added in the coming weeks.

“Images are becoming forums for conversation and discovery that include sharing, touching, commenting, and remixing rich media content created by others”, said CEO Ulla Engeström. “ThingLink is now enabling a new kind of discovery experience on Facebook Timeline that evokes emotion and brings moments to life in ways that drive higher engagement.”

Example: Mèdecins Sans Frontiérs on Facebook Timeline via ThingLink: https://www.facebook.com/msf.english/posts/10151343426237385

Founded in 2010, ThingLink is the leading interactive image platform with over 130,000 publishers. ThingLink’s enterprise level account for publishers, agencies and brands offers such key features as group account management and the ability to create and launch custom image apps and icons that enhance engagement. ThingLink also offers advanced metrics for measuring image performance across social channels like Facebook, Twitter, and Tumblr, enabling valuable, new insights into consumer engagement.

At launch tomorrow, we are supporting YouTube, Vimeo, Instagram, Imgur, Flickr, Twitter, iTunes, and all Open Graph tags inside images. We will add support for more tags (including custom 3rd party tags) in the coming weeks. 

How does it work: Touch the FB sharing icon on any ThingLink image or drop a ThingLink image url to FB Timeline directly.

When ThingLink interactive images are shared into Twitter, brands have commonly seen 5-30x improvements in engagement. Wherever ThingLink images are used on Web pages,  the discoverability of content inside images makes those pages”stickier”, with increases in time spent on page.

For more information visit ThingLink.com and ThingLinkPress.com.

Source: ThingLink press release

Now that Twitter Music is finally out, we know what it is and what it isn’t.

It’s not a music streaming service, and Twitter isn’t (directly) selling music with it. It’s a music discovery service, similar in a way to Pandora, but leveraging the vast Twitter community that, as we all know, often takes to Twitter to discuss music or interact with favorite musicians.

And while it may turn out to be a useful service for users — it’s too early to tell, but I like the look and feel of it — it might turn out to be an even more important service for musicians.

The thing is, Twitter Music is practically making you follow musicians on Twitter. The more you follow, the better Twitter’s musical suggestions for you will be, and then, going through the “Suggested” section, you’ll follow some more.

I don’t follow many musicians on Twitter, but in the first hour of using the service, I followed several dozen new ones. And I reckon most people who will be flocking to the service in the coming days will do the same.

Major Influx of New Followers

If that premise is true, and if Twitter Music turns out to be successful, we’ll see a major rise in the number of people following musicians on Twitter. Those in the “Popular” section will benefit the most (Psy is currently topping it; it’ll be interesting to see how many new followers he’ll gain over the next few days), but even less popular artists will likely get a boost from the “Emerging” section, as well as the “#NowPlaying” section, which shows songs tweeted by your followers.

Will it turn into revenue? It could. Twitter is currently offering only iTunes previews of songs, with a link to buy the song on iTunes. Alternatively, you can listen to entire songs if you have a Spotify or Rdio subscriptions, both of which could ultimately have a positive impact on music sales — though it’s been said several times that musicians don’t make much money off Spotify.

But the simple fact that Twitter buzz about music is now directly tuned into music purchases is good news for artists. Plus, artists make money of concerts, and even if those Spotify or Rdio subscriptions bring pennies, the buzz around a band will bring more people to concerts.

Twitter — A Place for Music?

Most importantly, though, if Twitter Music is successful, it will turn Twitter into a place for music — similar to what MySpace once was, and what it based its plan for resurgence on in early 2013.

That’s a big IF, though. The lack of a visual component remains an issue. YouTube has long been the place for music discovery (even though its discovery engine is rudimentary at best) simply because the music is accompanied by moving images. Twitter Music doesn’t have that, and it might turn into a bore, especially for younger generations.

Source: Mashable (by Stan Schroeder)

The past week has seen a flurry of activity around Twitter’s purported new music streaming service, #music. As previously reported, Ryan Seacrest told his followers last Thursday that Twitter #music was real, and he was already playing with it. Over the last two days, a number of prominent musicians have also tweeted about the service, which reportedly pulls in tracks from a number of services including Rdio, Spotify, YouTube, Vevo, SoundCloud, and iTunes.

In one tweet, Nikki Sixx calls #music revolutionary, while Moby, Alt-J, and Ne-Yo all appear impressed with it as well. Moby, after listening to a James Blake track through the service, called it “a really interesting music resource,” Ne-Yo said that “Twitter has some insane things in the pipeline,” and Alt-J called it “rad.” As AllThingsD points out, Ryan Seacrest has been known to engage in “faux-stealth marketing” in the past, so it’s a little tricky to take these new, overwhelmingly positive comments at face value.

It’s not clear when Twitter will make #music available publicly, nor do we know exactly how it will work. Earlier rumors pointed to a launch to coincide with the Coachella festival, but that’s now come and gone. In the meantime, you can console yourself with the fact that more important people than you are having the time of lives using the service.

Source: The Verge (by Aaron Souppouris)