MySpace Loses $150 Million Dollars.......

Yes, according to Hypebot MySpace has been losing money with a reported $150 million dollars lost this past quarter, along with the $88 million dollars they lost last year. This news final clears up some of the mixed reports released from NewsCorp. to their investors earlier this week. Also, an earlier post on Hypebot showed a graph put together by NielsonWire Research Group which confirmed that MySpace has been losing unique page visits since 2008 in comparison to Facebook. So, what does this mean for the standpoint of music marketing? Well it shows that there’s a change happening where possible fans are now at on social networks, and with music sites like ReverbNation creating widget tools to easily embed music into Facebook fan pages. I predict within the next few years that the idea of creating a MySpace music page to place your bands music will not be as appealing as creating a Fanbage on Facebook. The easy tools Facebook offers to share content with larger audiences will continue to increase as the years go on, but only time will tell.

Submitted by: Jarvis R. Smith

Source
http://www.hypebot.com/hypebot/2010/05/myspace-lost-150m-in-last-3-months.html

Has Apple gone rotten?

Many of us are children of the indie rock movement (don’t care if you don’t want to be labeled that, your fondness of that one non-indie thing is not going to keep me or anyone else from stereotyping you). Our niche identifies with a sort of anti-consumerism or counter-consumerism that is probably just sub-consumerism. I mean of course, that we don’t like to eat at McDonalds or shop at Wal-Mart because, when it comes down to it, we are just too indie-rock. A candy bar (or more likely some vintage candy that you eat ironically) is probably not any healthier or less chemically then a side of McDonald's fries, but many of us would take the candy bar just out of principle (that and McDonald's smells like a toxic waste dump). For better or worse, most anyone who owns an Animal Collective CD has a sort of consumer conscious that we tend to take more seriously than mainstream culture.

That said, we come to my point – Apple. When ABC has a story “Has Apple Lost it’s Cool?” the answer (for me) is undoubtedly yes. As briefly discussed in the video, Apple can be a bully when it comes to market share. They’ve shown us that they aren’t afraid to sue everyone or illegally raid your house for the iPhone 4G. In fact, they are starting to make Microsoft look like a softy. Have we all forgotten we didn’t want Microsoft to be anti-competitive? Why are there no Apple anti-trust cases? In my opinion, it’s because they slap the words green and sexy on everything they do. Apple: green and sexy. Bill Gates: bad. Ever heard of marketing? Ever think your just buying the image Apple is selling?

Although I think this video is overwhelmingly bias on Apple’s side (I mean they interview a guy that has Apple tattooed on his forehead with a MacBook), at least the video gives us a foreshadowing of the Apple backlash on its way. For me, it’s already here.

Stay tuned for the next ABC special – “Has MySpace lost it’s awesome?” Really ABC?

- Ian Gollahon

WMG Offers Mixed Financial Reports, Digital Sales Up

Warner Music Group showed a loss for the quarter ending March 31st of $25 million or 17 cents per share. That amount has decreased significantly because in the same quarter last year, they had $68 million or 45 cents a share loss. Their overall revenue fell 1.3% to $662 million with rising digital sales contributing to their improving numbers. Other improvements are that digital sales reached $199 million or 30% of total revenue which is up 8% from the previous quarter and up 15% from $173 million in the prior-year quarter. In addition, operating income grew 60% to $24 million compared to $15 million in the prior-year quarter.

Obviously, these statistics indicate that digital sales are taking over. Who knows where Warner Music Group would even be right now without them. We'll just have to continue to wait and see if digital music wipes out CDs completely.

- Samantha Bruno

Source:

http://www.hypebot.com/hypebot/2010/05/wmg-offers-mixed-financial-report-digital-sales-up.html#more

Hip-Hop's "Independent" Business Model

Young Money's Drake, before he was part of Young Money, was credited as an independent artists. Drake's credit spans from releasing So Far Gone as an independent mixtape, becoming Grammy nominated, and reaching 2,000 downloads in 10 minutes of the release of his album, but how independent was he really? There is word that he was already signed to Young Money/Universal when all this hype was going on. The same thing is rumored to have happened with Souljah Boy and recently with Spree Wilson. Spree Wilson signed to Jive Records without disclosing the deal because they wanted him to market himself and put out mixtapes and pre-projects to create buzz.

I think this is an interesting way to go about things considering it has always been the buzz an artist creates for themselves that gets the attention of the major labels, so this seems a little backwards. It gives artists credit to be successful on their own, but then they have the major label to back them and help them make money.

It's quoted about Souljah Boy that "At the first radio meeting after he was signed, the label decided to do nothing because they didn't want to mess with his grassroots." This could be good because fans' loyalty will grow and everyone wants to see their favorite independent artist make it big on their own. On the opposing side, fans may feel betrayed for being made to believe the artist made it on their own when really a major label helped them out.

Source: http://nymag.com/daily/entertainment/2010/05/hip_hops_new_business_model_ma.html

by Rebecca Weyhrauch

Buy a Ticket, Get an Album

Tom Petty has announced that for every ticket purchased for his upcoming tour, he will be giving away his first new album in five years free of charge. Once you buy the ticket, you will get two tracks to download right then, and then later, when the album is released in June, you will get a free download of the entire album plus some bonus live tracks from the tour.

This is being provided by Live Nation, who said that with the merge with Ticketmaster, they would like to be able to do more cross promotion like this.

This makes sense to reel in some excited fans and make them even more excited by the fact that this new album (the first in five years) is being handed to them on top of their ticket to see Tom Petty live. Plus, with fewer people interested in buying music, but many still interested in concerts, it seems like a good idea and a fair trade.

But it is Tom Petty. And his concert tickets probably don't cost $15. So, I'd say this is a loss that Tom Petty can take. I still think it may be a good idea for bands to do, even if it is just a few free songs, because that can make the difference between a fan buying a ticket and not buying one. If you add a little extra, it definitely makes it more appealing.

--Ashley Snider

Source: http://www.hypebot.com/hypebot/2010/05/even-tom-petty-gives-his-music-away-free.html

Breakthrough for Ad Supported Music

A UK music streaming service, we7, had its first profitable month – where on demand music was paid for in full by advertising. This most likely makes we7 the first company to demonstrate that a music on-demand ad-funded model can be profitable and still return measurable royalties.

The company states that one million plays on we7 generates payments to the music industry of between $3,100 and $6,200. These payouts “dwarf previously reported competitive models, especially revenue share models which shift the risk to the artists and songwriters.”

There is a long list of companies, Lala among them, that have failed to make ad supported music profitable. So what makes we7 different? Part of it might be their model of controlled growth, but a larger part of it could definitely be that record labels that given it reasonable terms and time to experiment.

Simon Wheeler, Director of Digital at Beggars Group, says “with the emergence of new digital models, it is important that they are given opportunity to develop and grow, but with a clear understanding that music has a value which needs to be recognized and paid for.” The CEO of we7, Steve Purdham, agrees “music has never been a ‘freemium’ model – they key going forward is protecting the value of music with smart economic delivery.”

If we7 can maintain its profitability, it could be a breakthrough for ad supported music and it would mean that the music on-demand ad-funded model can work – it just needed time to find which variation worked best.

Source: http://www.hypebot.com/hypebot/2010/04/we7-claims-a-profitable-month-is-this-a-breakthrough-for-ad-supported-music.html

-Emilia Segatti

Bye, Bye Lala. Hello Cloud?

Yes, according to the San Francisco Gate, Apple will be closing down Lala for good on May 31st. The decision for many has come unexpectedly, and Apple has the blogsphere questioning their decision to close Lala. Was it because Lala wasn’t generating enough revenue? Was Lala losing customers? Well the San Francisco Gate believes Apple is getting ready to unleash their version of the cloud, but it’s still speculation. It will be a shame if Apple doesn’t make use of the cloud distribution technology Lala has, and incorporates it into iTunes somehow. The only downside I see to Lala closing is that all the users who were loyal to the service will be left without a home. This also makes me wonder what will Pitchfork be using as an alternative source to stream music come May 31st? The “Apple Cloud” saga begins (maybe).

Submitted by: Jarvis R. Smith

Source
http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2010/05/01/bloomberg1376-L1RCTK1A74E9-5.DTL