Music Ally

Now the dust has settled from MidemNet and MIDEM, we thought we’d round up all our coverage from the show in one post. Read on for a reminder of the news and liveblogs we posted from the conference.

NEWS
Pharrell Williams: Illegal downloading is ‘just taste-testing’
Spotify: 250k paying subscribers and a ‘double-digit million Euro’ ad business
Vodafone reveals 450k music subscription customers
Labels criticise unlimited downloads business models
YouTube now monetising 1bn+ videos a week through ads
Shazam now selling 300,000 track downloads a day

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On Saturday, MySpace CEO Owen Van Natta revealed that more than 180 million playlists have been created on MySpace Music. Well, Spotify is hot on its heels: yesterday, its CEO Daniel Ek revealed its own playlist stats, based on just six countries in Europe.

“Right now we’re almost close to 100 million playlists on our users, and 30% of those are albums,” he said. “People do actually listen to albums, and they’re storing them.”

Ek also said that Spotify doesn’t differentiate between its ad-supported and subscription business models – they’re wrapped up together, along with revenue from downloads.

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There might be discussion around the viability of YouTube’s ad-supported business model in the music industry, but the company’s director of video partnerships Patrick Walker tried to dispel them in yesterday’s closing session at MidemNet, where he shared the stage with Spotify’s Daniel Ek.

“Now we’re monetising over a billion videos per week,” said Walker, who also claimed that 75 of the world’s top 100 advertisers ran campaigns on YouTube last year, and that the site signed 500 new partners during 2009.

Walker also said that YouTube is generating CPMs of between £15 and £30 in the UK for pre-roll ads on the site.

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Getty Images CEO Jonathan Klein had a blunt message for the music industry in his on-stage interview at MidemNet yesterday: don’t try to fight technological progress.

“Don’t stand in the way of technology, and in the way of what the customer wants,” he said, claiming that when Getty Images launched, its industry was facing as frightening advances and business model disruption as the music industry has been.

Klein said Getty chose to embrace them. “We were the first people in the world to sell an image online,” he said, before suggesting that a more hands-off approach to licensing and content ownership might benefit labels.

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Media futurist Gerd Leonhard did his thing on-stage at MidemNet this afternoon, talking about some of the new business models being used outside the music world. One of the most fascinating was Farmville.

Zynga’s social game is absolutely huge on Facebook, as you’ll know if your friends and family are clogging up your news feed with lost pigs, horses and chickens. It’s got more than 73 million users on Facebook, and is generating millions of revenues from selling virtual items.

Leonhard held it up as an example to the music industry, particularly its free-to-play model. “What can we learn from Farmville? It all starts with free. Farmville gets people hooked, then sells them virtual tractors. People will buy anything once they’re hooked.”

He suggested that the music industry should be looking more deeply into interactivity and virtual items, as well as social media. “Go inside the social networks with music!” he said.

“How come Facebook doesn’t have music? 8.7 billion minutes are spent a day on Facebook, so why can’t we make a deal – hopefully not individually, but collectively.”

That’s something of a simplification, though. There IS music on Facebook, through apps like iLike, and some virtual items. But Leonhard is absolutely right to say that the explosion in social games has by and large passed music by. In 2010, that will hopefully change.”

Harvey Goldsmith took to the stage at MidemNet this afternoon to plead for the live music business to be given “a seat at the table” when it comes to the future monetisation of music.

He pointed to the rise in live revenues, compared to the decline in recorded revenues. “The industry doesn’t talk to each other on a senior level. Normally all the conversations centre around recorded music, and live is left out.”

Goldsmith wants to see recorded product linked with live music. “Greed on all fronts is going to stifle the goodwill and great business we’re in,” he said, warning that overpricing risks alienating the music fans upon whom the industry depends.

“Good strong management is imperative,” he said, saying he sees good subscription services as a crucial element in persuading people to pay for music.

He also said the industry needs new people. “In technology, I actually believe the future is gonna be in near-field communication using RFID chips, just like the Oyster card we have in London,” he said, referring to the British Music Experience exhibition, which uses the technology.

He also talked about the Live Nation / Ticketmaster deal. “I believe that the Live Nation / Ticketmaster deal will make everybody else sharpen the pencil and start to become more creative. There are tons of new solutions around to deal with the issues that everyone’s concerned about with that deal.”

iPhone music games developer Tapulous is looking beyond iPhone for its hugely popular Tap Tap Revenge series, according to its VP of business development Tim O’Brien.

“To date we haven’t been motivated to move to another platform, but in 2010 we’re definitely looking to port,” he said, while appearing at the MidemNet Mobile Apps and Music panel session.

The Tap Tap Revenge games have now generated more than 25 million downloads on the App Store, and it was recently reported that Tapulous is making $1 million a month from them, through a mixture of game sales and in-app payments.

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Mobile music discovery app Shazam is now generating 300,000 track purchases a day, according to CEO Andrew Fisher, talking at MidemNet 2010’s mobile apps and music panel session today.

He was responding to a question from the audience, asking him to divulge more figures on Shazam’s success beyond its headline figure of 50 million mobile users.

Fisher said that Shazam is driving 13% conversion rates from people tagging tracks using its apps. He also talked about the importance for the company of not focusing on a single smartphone platform – like iPhone – but of launching across all handsets.

Meanwhile, Fisher also sang the praises of augmented reality – as a mobile user, rather than hinting at AR features for Shazam.

For Music Ally’s full liveblog of the session, head to the Midem(Net) Blog.

Ted Mico from Interscope / Geffen / A&M says mobile apps offer a host of possibilities for the music industry, but only when done well. “Great apps are like babies,” he said. “Very easy to conceive, but very hard to deliver…”

He was speaking on a panel session devoted to mobile apps this afternoon. Mico highlighted the fact that artists have to be prepared to genuinely support their apps, rather than simply launching and then forgetting about them.

“The content has to be immediate and authentic, not some canned EPK content – if you’re not prepared to do the work, you’re not going to get the results,” he said. “The artists who are willing to do that are going to prosper… At the moment, the evidence is stacking up in favour of doing the extra work.”

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Mobile music luminary Ralph Simon took the stage at MidemNet this afternoon to talk about his ideas on what works for music monetisation. Unsurprisingly, it focused on mobile.

He started by hailing the current generation of smartphones, with their many and varied features, before kicking into his main ideas. “One of the things that really has to change is A&R,” he said.

“We should coin a new term here today… AA&R, which is really about access – access to the social networks, and to the communities that build, drive and really sell music and the music experience around the world.”

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