>play Music panel will discuss the current state of digital music and the emerging path as the business models change. Is free the new business model? Giving things away for free isn’t new, people have been giving away software, books, ideas, knowledge, art all for free. There is a great study on the economics of open source by Professor Eric Von Hippel of MIT. The argument applies to any creative work that previously had a price but is now given away.  In a recent article Michael Arrington of Techcrunch says, albums and singles will cease to be the source of revenue and will become marketing tools for other services (like concerts).

I will be very much interested in asking one of the panelists, RealNetworks , who have a subscription model, how the “free music movement” will transform their business model. Will Rhapsody/RealNetworks and others such services will become marketing channels rather than remain as digital music stores?

Join us at >play on October 27th to ask your questions.

Technorati Tags: >play, play conference, haas, berkeley, digital music, drm, rhapsody, realnetworks, music subscription

I’m delighted to introduce our first panel moderator for the 2007 >play conference. Kelli Richards, president of the All Access Group, will be moderating the digital music panel, which will explore the changing rolls of the major players in an industry that seems to be evolving from week to week. Kelli has served at the top levels of major entertainment and technology companies, and recently co-authored the book The Art of Digital Music.

Kelli writes this on her blog about moderating at >play 2007:

I’ve been asked to moderate a panel on the shifting roles in the digital music space as business models evolve. Joining me will be representatives of the different players in the ecosystem from the artist, label, device, distribution, and social networking communities. We’ll look at the power shifts between artists and labels, consumers and media companies, and more. It should be a fun and engaging dialogue; please come and “play” with us if you’re able.

Thanks Kelli, we look forward to the panel on October 27.

I think most of you already know this by now. Apple announced new line of iPods today and they refreshed the whole line.
Four highlights of the day are:

1. New Nano with video: I think some people will miss the old Nano design. Dual screen thing was impressive.
2. New iPhone like iPod touch with WiFi + Safari browser + You Tube: This is why we love Apple.
3. iTunes WiFi store: Finally!! iPhone will have this also.
4. iPhone price drop to $399: You can get your money back if you bought an iPhone within last 10 days.

A few more comments.
- $0.99 for making a ringtone with a music you already bought?! Hum… will people pay for this?
- Now iPod classic has 160G

As always,you can watch Jobs’ keynote here.

Zune announced $50 price drop today. Why to go Microsoft!

Mickey

Does anyone else feel like the mix of music played on your Pandora radio stations has gotten better in the past few days, playing more of “your” music than before?  Previously, I’ve felt like Pandora plays music similar to what I like, but doesn’t play as much of the songs it knows I like as I would like.  I think last.fm’s radio service does a good job of playing more of the songs I like, with some discovery sprinkled in.  Of course, you have to pay to listen to your own last.fm radio station.  I credit Pandora’s advanced advertising offerings for their willingness to offer a radio service free to the listener.

Also, I’ve found last.fm’s audio stream to be choppy.  I prefer the buffering done by Pandora to ensure continuous playback (and know a new song is coming when the voice service breaks up on my internet phone ).

Pandora is the leader in enabling music discovery.  Unlike other types of content (e.g. news or online video), music listening is not just about discovery.  We are not only willing to listen to favorite songs more than once, we often crave to hear a favorite song over and over.  I wonder if Pandora has recently made significant changes to their music selection algorithm, recognizing listeners’ desire to hear more of their favorites, with a corresponding reduction in discovery material.  Are you hearing anything different (or should I say more familiar…)?

Bluegrass musician (and one of my favorite virtuosos ever) Dave Grisman recently sued Warner and Universal Music--as well as their online partners (Apple, Yahoo, etc.)–for distributing Grisman’s music online without his consent. Grisman set up his own label years ago, called Dawg Music, and that entity holds the copyrights to his recorded songs. According to the lawsuit, Warner and Universal do not have the right to distribute those songs online and have been with holding royalty payments from online sales to Grisman. The online partners are guilty by association, and, according to the law suit, are also on the hook for reparations.

My favorite part to all this? The labels are being sued for piracy! Who woulda’ thunk it!

Tim Westergren, founder of Pandora, writes this letter to all of internet-dom. This a direct response to the Copyright Royalty Board’s recent decision to triple internet music licensing fees.

To read his letter and sign (or not) his petition, click here.

So I ask all of you: Is there a way for internet radio to work? Does the fact that broadcast radio pays $0 for fees mean that there’s still hope? Could the untold numbers of internet radio stations band together in a tour-de-force and push more negotiation?

As a very big fan of internet radio (my fave being SomaFM of course), I wouldn’t mind all THAT much if the stations I listened to adopted a more broadcast-type model (ad supported)- seeing as the only other option is radio silence.

What do you think?

In case you haven’t seen it, here’s an article with some observations on what’s happened in the music business by a couple of guys who used to own a record store.  I love analogies, and they put forth a couple of amusing ones.  I think it’s interesting that the artists I associate with the big labels seem to be best at putting out singles, when the labels want to sell albums.  Even if you feel like you understand what’s been happening with the record labels and online music, I think it’s an enjoyable read.

Here’s a link to the article on NYTimes site (I worry it won’t work after two weeks?): http://www.nytimes.com/2007/04/05/opinion/05sachsnunziato.html

I’d enjoy hearing if anyone disagrees with the authors - are they overly biased by their dream that the local record store ever had a chance of thriving in a culture of instant gratification and online music discovery tools?

Forget seeing the Beatles on iTunes this week, but what you will see next month is EMI artists (not including the Walrus, et. al.) offering their music DRM-free. In addition to the usual $0.99 offering, songs will now be available at a new price point, $1.29, which will give you a higher quality version that is also DRM-free.  Check out the announcement on Apple’s site, and the webcast on EMI’s site. Wow, maybe we should have seen this coming, but I guess I’m surprised that it happened so quickly. Stay tuned for more discussion on the ramifications of this announcement.

Steve Jobs will be in London on Monday for a special announcement with record label EMI, the label that carries all of The Beatles music. Does this mean that we’ll soon find The White Album on iTunes? This would certainly be an historic announcement, but is this really a big deal for music fans? I would imagine that most of the baby boomers who grew up feasting on Beatles tunes have already dumped their entire collection into their 80GB ipods, and the younger generations are holding their collective breath for the next Avril CD.

The record labels have stooped to a new low. I know—hard to believe, but true, and it’s happening in our own backyard. And what’s more disturbing than the actions of the labels is the compliance of the UC school system—UC Berkeley in particular. Before I get too far ahead of myself, let me set the stage.

CD sales are down for the seventh consecutive year, inciting panic among industry giants. While still profitable, their once-healthy margins are eroding rapidly, as they haven’t taken the time to innovate around a new business model that would capitalize on digital music. Instead, they are clinging to a faulty DRM system amid recent counterstrikes such as Steve Jobs’ appeal to eliminate the faulty system, and fellow industry giant EMI’s alleged move to offer its collection DRM-free.

So what is their solution? “Let’s sue college kids, because once they realize the penalties of sharing our music illegally, they’ll be sure to buy CD’s again or pay $0.99 per song, right?” Now even though I wrote it, I’ll not dignify this rhetorical gem with a response.

Here’s where the real sordid details come in. How do the labels know how to find the students? Surely their identity is somehow masked behind the guarded cloak of their university. Alas, it seems your esteemed university, the bastion of ideals and convictions, has been caught in bed with the unsavory fat (albeit much slimmer now) cats of the music industry (unless you’re affiliated with the honorable University of Wisconsin, which has maintained its principles in rejecting the overtures of the labels).

Now I’m not advocating the illegal sharing of music, or the circumventing of DRM, or anything else against the law. I was just trying to put my finger on the real problem in the music industry (before I was sidetracked by the shameful matter of privacy and your university). If the recording industry wants to make money from digital music, they are going to have to figure out how to give it value. They need to stop trying to lock up the music and develop a way to give it value again. I challenge you all to think about how this can happen. Is it additional content from the artists that is tied in with a new type of player? Is it the ability to deconstruct a song the way Nine Inch Nails has allowed through GarageBand? Is it song quality (probably not)? Is it tied into video games?

Whatever it is, I’m confident that music fans are not going to flock back to CD stores and fork over cash for tracks just because a few of their friends are getting sued. In fact, they’re likely to rebel even harder in the future. There’s no question the generation of listeners out there today is many times over more innovative than the morons that pass for executives in an industry deteriorating before our very eyes.