Beats’ decision to spin off its in-development streaming music service Daisy as a separate company isn’t a surprise, nor is its decision to raise $60m of funding to do it.
The lead investor may be more of a shock though: Access Industries. Yes, the same Access Industries, founded by Len Blavatnik, which both owns Warner Music Group and invested $130m in streaming service Deezer just five months ago, in October 2012.
Access isn’t the sole investor in Beats’ new round: billionaires Marc Rowan, James Packer and Lee Bass are also chipping in. But it’s Blavatnik’s involvement – and the fact that Daisy and Deezer now share a common investor – that’s most interesting.
“Beats has the vision, the brand, the management team and now the investor group to effectively change the expectations and experiences of a music subscription service,” says Blavatnik in a statement. More so than Deezer? It’s a fascinating move, not least because of the WMG connection.
Labels taking stakes in digital services is hardly a new phenomenon, but we’re intrigued by the dynamics of WMG’s owner having a major, solo stake in two prominent streaming services. The funding announcement also reiterates a “late 2013” launch date for Daisy, with “music discovery” still being flagged up as its key innovation.
Oh, and there’s a separate report by Reuters claiming that Beats’ Jimmy Iovine recently met Apple CEO Tim Cook and services boss Eddy Cue to tell them more about Daisy, with a “potential partnership” in the air, just to add a little more spice to today’s news.
The news also reminds us of the money pouring into streaming music, despite the chatter a couple of years ago that businesses requiring licences were a mug’s game for investors.
Rounds of $130m for Deezer, $100m for Spotify and now $60m for Daisy, with Google and Apple lurking in the wings with their own well-resourced streaming plans. Rightsholders will cheer in the short term, naturally, but how many pockets will be deep enough to stay in this streaming race for the long term?