Digital music startup Beyond Oblivion has shut down, having failed to launch a commercial version of its service. After rumours swept the industry yesterday (30-Dec), CEO Adam Kidron confirmed the news to the Financial Times.

“Beyond was always a tremendously grand ambition as the advances required by the record labels and music publishers were substantial, reflecting the breadth of the rights required to create a true digital music one-stop,” said Kidron in a statement.

The company had reportedly raised $87m in funding from investors including News Corporation, The Wellcome Foundation and Allen & Co, but this does not mean – contrary to some reports – that Beyond Oblivion burned through that cash.

In fact, Music Ally understands that the company failed to meet specific landmarks in closing deals with device makers and mobile operators, leading investors to pull out. In other words, Beyond Oblivion did not receive the full $87m, although it remains unclear how much the company did receive.

The company has spent the last two years touting its business model, which was complex, but can be boiled down as a hybrid of Nokia’s Comes With Music (i.e. the price would be bundled into the cost of a device) and subscription-based services like Spotify and Rhapsody – with a beefier layer of music recommendations on top.

Beyond Oblivion appears to have been spiked by a not-so-virtuous circle: it needed big device and operator deals to launch; yet needed a full set of licences to secure those deals; needed to get another injection of its promised funds to cover the advances for those deals; yet couldn’t release the cash without signing the device and operator agreements.

Kidron’s statement about the “substantial” advances is likely to provoke the most debate in the coming days, particularly around how much those demands from rightsholders reflected a lack of confidence in Beyond Oblivion’s business model, versus greed at the sight of a well-funded new music startup promising huge payouts.

More details are likely to emerge in the coming days.

EarPods and phone

Tools: platforms to help you reach new audiences

Tools: Kaiber

In the year or so since its launch, AI startup Kaiber has been making waves,…

Read all Tools >>

Music Ally's Head of Insight

Leave a comment

Your email address will not be published. Required fields are marked *