We7 plucks The Orchard catalog

Ad-supported music service We7 today announced the addition of over 1.3m songs from The Orchard’s catalog. The agreement between the British, Peter Gabriel backed service and the U.S. distributor covers all three of We7’s usage models: ad-funded, on-demand streaming; ad-supported free downloads; and paid-for MP3 downloads.

After striking deals with PIAS and EMI earlier this month, CEO Steve Purdham can now boast license agreements with three major labels (Sony BMG, Warner Music and EMI) and a rising number of independent companies. 

These deals look convincing at first glance, but they come with a blemish, as Glenn at Coolfer rightly points out: 

“That’s great for We7, but it’s product offering is still a jumbled mess. One has to wonder if it would be better off setting the bar higher and accepting music only from those labels that will participate in all three offerings. A well-defined product has worked well for eMusic (MP3s only, a monthly rate), Amazon.com (all labels, all MP3s) and imeem (stream everything).
Earlier this month We7 signed up EMI but does not offer the music group’s tracks as ad-supported downloads. Sony BMG is also on board, but only for ad-supported streaming. Warner UK is on boardas well, but like EMI has opted out of the free, ad-supported downloads.” 

Wal-Mart secures another AC/DC exclusive

After winning Columbia Records’ support to become the exclusive U.S. retailer of the upcoming new AC/DC release “Black Ice”, Wal-Mart will also be the only outlet to sell “AC/DC Live: Rock Band” the New York Times reports. MTV Games will officially announce the partnership for the new product later today. The game is expected to cost significantly less than other versions of “Rock Band”. About $40 instead of $60. 

“If you want to be a physical band, you better make an alliance with a strong physical retailer,” said Steve Barnett, chairman of Columbia Records. “It’s a great way to sell the new album, the catalog, the game, merchandise and DVDs.” MTV and Wal-Mart are exploring the idea of setting up temporary shops to sell the game and the album in Manhattan and Los Angeles, where the retailer has no stores.

Can’t wait for instore audio at my local Wal-Mart. Checking out there is already a highway to hell. At least now the soundtrack will fit the occasion.

Pakman to exit eMusic by year’s end

After five years at the company David Pakman, President & CEO of eMusic, will leave his post by the end of this year to take a job at a yet undisclosed VC firm. eMusic doesn’t have a successor yet and has appointed the Barlow Group to help with the search for an executive to replace David. Keep your fingers crossed this process won’t mimic the CEO casting at MySpace Music. While some pundits suspected some kind of fall-out with eMusic’s owners (JDS Capital) led to his exit, I’m being told David will leave to persue “his dream job”. Turns out his new company is located right accross the street from eMusic’s offices in New York. Pakman will assist the transition and will stay with the company as a board member. No matter who will try to follow in his foot steps: He or she will have to live with high expectations. While David succeeded in building eMusic into a $70m business with some 400.000 paying subscribers the company’s owners “look forward to working with a new CEO who will take the company to several hundred million of revenue.”

UK labels want upfront payment from EUK

The physical market in the UK might see some product shortages in coming weeks. Music Week reports that wholesale operation EUK was refused credit by its suppliers. Entertainment distributor EUK is a subsidiary of the Woolworths Group which recently posted nightmare inducing half year figures. While increased net loss and shrinking revenues were mainly due to Woolworths’ week high street business, EUK has seen solid business recently. Nevertheless, the labels fear potentially worsening financials at Woolworths Group could affect their business. According to the trade mag, EUK is currently only able to get stock by paying upfront. EUK provides retailers like Zavvi, Sainsbury’s and Asda with music products.

Comes With Music might not come with much music

I meant to post to this earlier. Helienne Lindvall has some interesting news on Nokia’s Comes With Music. In her Blog at the Guardian she points out that CWM might eventually be a rather limited proposition to both, users and rights holders. It seems like Nokia has yet to reach a license agreement with UK rights societey MCPS-PRS before CWM’s launch date on October, 2nd. 

“MCPS-PRS, the organisation that represents and collects royalties for the composers, hasn’t yet come to an agreement with Nokia regarding how much the writers will be paid. When I asked MCPS-PRS about it I was told: “The deal will be done for launch!” Hopefully, it will be more advantageous for the composers than the YouTube deal they struck, which so far seems to be bringing in the pennies.”

Even more alarming: Nokia will either have to limit the number of actual songs their users will download via CWM or they will have to eat the costs for all downloads exceeding the per gadget amount they pay the labels. 

“These are the details of the Nokia Comes With Music scheme – as they have been given to the MMF by Sony BMG: the handset will have a “wholesale” price of £50, of which £31 will be attributable to sound recordings (this does not include the songwriters’ payments, which the MCPS-PRS is currently negotiating). Therefore, the consumer will not be able to download an unlimited number of free tracks as first touted, rather a maximum of 120 in a year. This is because the lowest price per download that the labels agreed on would be 25.8p.”

Words of Warcraft continue between music and games

When Warner Music CEO Edgar Bronfman jr. started his crusade on the games publishers it was clear this debate would stay alive for some time. Bronfman says the labels deserve a bigger cut from sales of rhythm games like “Guitar Hero” or “Rock Band”. Games Publishers say the inclusion of songs in their games promoted the artists and their catalogs. Most recently, Activision Blizzard CEO Bobby Kotick fired back at Bronfman via the “Wall Street Journal” by questioning music licenses as a whole. Apparently Kotick thinks that labels should be more than happy to be part of a “GH” release beacause it will propel download and merch sales for their acts. 

“We compensate artists and publishers extremely well. There are millions and millions of dollars that are being made and paid. There’s a misunderstanding of the value we bring to the catalog. What happens to your catalog in digital downloads? What happens to your merchandise? What happens to your ticket sales? When you look at the impact it can have on an Aerosmith, Van Halen or Metallica, it’s really significant, so much so that you sort of question whether or not, in the case of those kinds of products, you should be paying any money at all and whether it should be the reverse.” 

Asked, if he wouldn’t consider the music as one of the major USPs for his products he flat out denied that. 

“We have lots of music to choose from, lots of artists to choose from. A 12-year-old kid has no idea who Steven Tyler is or who Aerosmith is. The bulk of our consumers will tell you they’re not purchasing the products based on the songs that are included. They’re purchasing based on how fun the songs are to play when they’re playing them.”

An adequate response from the Warner Music camp should be imminent. This is almost as entertaining to watch as the sparring between Obama and McCain. 
For those of you who want to read a little more about the relationship between the music and the games industries I once again recommend my feature story for German trade weekly MusikWoche.

Vote and you “Shall Be Released” say Wilco

Only weeks left until Election Eay and Wilco want you to do the right thing: vote. And given Jeff Tweedy’s political endorsement record it’s clear who he wants you to vote for. Wilco just doesn’t say that on the website. Instead they say: If you pledge to vote and if you give us yyour email we will let you download “I Shall Be Released” – for free.

How nice.  

Here is the “EULA”: 

“Such tumultuous times. And in the spirit of giveaways that seem to be sweeping the nation, we’ve got something free for you. No it’s not a pile of cash (sorry) but rather an audio postcard of sorts from a summer’s night in Oregon with our friends the Fleet Foxes & a lovely Bob Dylan tune. All we ask is you check the “I pledge to vote in the 2008 Election” button below. If you can spare it, we also encourage you to consider a donation to Feeding America . (and please feel free to pass this link along to friends, family members, etc.).”

MySpace Music is alive and the indies hate it

So, MySpace Music is finally live. Well, that took a while. After the multiple delays MySpace didn’t even make their midnight (EST) deadline. But who cares? It’s here and looks just like the leaks we saw a couple of days earlier. MSM is supposedly the most important launch since the introduction of the iTunes Store. It is therefore permitted to kick its tires really hard. Which a lot of news outlets have done already and more will follow. In fact, this launch will be discussed ad nauseam. My first impression: It works surprisingly well. It looks unsurprisingly ugly. I am not sure if I will spend less time on Facebook to look for music on MSM …

Some insiders say the delays are owed to EMI taking so long to sign on. Maybe MySpace should have waited even a couple more days to get the support of the independent community. Okay, The Orchard is part of the starting line-up. So are (essentially major-owned) ADA, Fontana, Caroline and RED. But where is the rest? IODA is said to be finishing talks with MSM, but the big names in indie music are still missing. No Domino, no Koch Records (DJ Khaled, anyone?), no Beggars Group, no finetunes, etc. Licensing agency Merlin are not really hiding their dissapointment with what they call a lock-out. The four majors were offered equity in the project, the indies will have to live with being mere business partners. More action to follow, I suppose. 

Also a draw-back: MSM’s playlist function – which in itself is a nice feature – won’t travel. There is no portability to playlists you create on your profile. You can only expose your musical taste (or lack thereof) to your MySpace friends. Memo to Chris DeWolfe/Amit Kapur: Guys, you need to enable widgets. That is state-of-the-art today. And it will help you grow your reach and your marketing potential. The folks at Amazon MP3 will support that, I’m sure.

PlayNow plus could eventually be smarter than Comes With Music

First Sweden, then the rest of the world. That’s how minds appear to be set at Sony Ericsson. While Nokia is debuting Comes With Music in the UK, S.E. will tip-toe into new mobile music territory in a country with less media coverage by overly critical business scribes (or at least with mostly swedish coverage that none of us read). They will work out all the kinks in Scandinavia first before expanding PlayNow plus into the rest of Europe. 

What I consider the winning feature of PlayNow plus is the fact that the files users get to keep after their subscription ends will be DRM-free. Unlike CWM these files will be limited to 300 tracks max. But the keepers are real. People can actually use them anywhere. For every six months of subscription you’ll get 100 songs – roughly equal to ten free MP3 albums. 

What should also help Sony Ericsson marketing PlayNow plus is their attempt at including the carriers. Telenor in Sweden is first, let’s wait for Vodafone, T-Mobile, O2, etc. to join. This means handsets will be subsidized and appeal to a mass market easier than Nokia’s CWM phones sold at full price. 

Here is Sony Ericsson’s press release announcing PlayNow plus.

Bronfman tells Germans to intensify copyright protection

A couple of days ago Edgar Bronfman jr. gave U.S. analysts an update on how the ongoing desaster on Wall Street will affect his Warner Music Group. As of now, he said, they’re not feeling the pain yet. But the stock will be hurt anyway, regardless of Warner’s performance. 

Said it, and got on a plane to Germany. During the annual, invitation-only media dinner in Hamburg (the HQ of Warner’s central European operations) Bronfman reminded German lawmakers of the necessity to reform copyright laws. In front of an audience of some 400 high-level executives he called upon Chancellor Angela Merkel to increase the level of protection for creators. Bronfman highlighted the French model of “graduated response” (aka “three strike and you’re out”) towards illegal filesharers as standard-setting. 

According to a report by MusikWoche Bronfman also downplayed the continuing recession in the recorded music market. “This desease isn’t lethal. The digital revolution comes with chances of healing.” The number of new revenue models keeps growing, the Warner CEO said. And the U.S. company wouldn’t pass on any good business opportunity.