7:16pm EDT, Thu Sep 2

Artists Breaking Free from the MP3

By: The Online Reporter
Publish Date: February 27, 2009

Complete articles are posted three weeks after they have been sent to subscribers. To request a copy of the current edition, e-mail paperboy@riderresearch.com .

SanDisk was really hoping its slotMusic player would revolutionize the way music is listened to and carried around. While that doesn’t seem to be happening, there seems to be a smaller revolution taking place in digital music as artists are moving away from the traditional MP3 model. One of the sticking points in the negotiations between Apple and the major labels has been pricing, with Apple finally budging and allowing three pricing options and in return offering DRM-free music. However, it seems artists and labels are also looking at other ways to leverage iTunes and other platforms to distribute music in a much wider price range through a variety of applications instead of files. Taking the App Approach The indie rock group The Presidents of the United States of America was one of the first to begin the trend by launching an application in Apple’s AppStore for $2.99, giving buyers access to all four of the band’s albums as well as extras and exclusives. Apple had to have approved the app, since it is currently available in the AppStore - surprising since it allows fans to listen to the band’s entire catalog for roughly the price of three songs purchased normally on iTunes. Subscribing to Bands Depeche Mode has become the first artist to take advantage of the Season Pass option available on the iTunes Store, offering a $19 subscription to its upcoming album “Sounds of the Universe.” The subscription includes an instant download of the album’s single “Wrong” and the remix of another track, as well as access to new music and exclusive videos before the album is released. The subscription also includes the album and other content when the album is released in late April. The Season Pass option has been successful for popular TV shows using the store, allowing users to make one purchase of a TV series’ season and have iTunes download new episodes as they are released. The music industry adopting this model is one of the first new experiments it is trying with both iTunes and digital music. This form of micro-subscription has also gained some traction in the music upstart called The Republic Project, which allows fans to subscribe to specific albums, receiving extra content over a period of time. Unlike the MP3 model that accompanies Apple’s “Season Pass” and the Depeche Mode album, the content here will appear on a bit torrent if a “physical” copy ever shows up at all. The Republic Project, expected to officially launch any time now, will start off with four artists whose albums can be pre-ordered. Instead of giving away singles or remixes at the initial purchase, however, the label will give users access to in-studio video shot by the artists on cameras from Flip, the label’s sponsor. Customers also get access to the band’s blog, song sheets and other content. A Value Shift “There’s a major problem in the music industry,” Republic Project CEO Ryan Swagar told Wired. “The value of a static MP3 album download, everybody agrees it’s on the decline. Right now you have bands, independent labels and major labels making this rush: ‘Okay, cool, if the content of this album is on the decline, how do we increase the value of that?’” As far as apps go, Apple and others aren’t worried since it’s unlikely the entire iTunes business would get swept away in a sea of band-specific apps. Having an app for every band would get tiring as users would have to switch whenever they wanted a change; not to mention the clutter that would abound on the iPhone/iPod touch screen. What Apple is not likely to allow in its store are apps that continually update with new downloadable music from different artists on the same label. The battle-ax of DRM has been set aside in favor of timeliness and exclusive content. Instead of trying to cut off the head of P2P services, labels decided to start pairing their album sales with content people can’t get anywhere else. The digital album is no longer simply an electronic version of a physical album, it is coming to life in its own right through a medium all its own. Spotify Picks Up Naxos, INgrooves The ad-supported and subscription music streaming service Spotify has extended its reach to everyone in the UK and celebrated by announcing that it’s picked up the catalogs of the classical music label Naxos and the independent label INgrooves. The Naxos agreement will give its users access to one of the largest and fastest-growing classical music libraries. Naxos has more than 100,000 exclusive tracks and covers a wide range of classical music, from Mozart and Handel to Bax and Dupre. The Naxos deal also adds contemporary and folk music from the first half of the 20th Century. Following the Naxos announcement was a blog post from Spotify saying the label has signed an agreement with INgrooves to add its catalog of roughly 250,000 tracks. There wasn’t much more about the deal, but INgrooves is a major player in independent and some mainstream music. This is a very important deal for the music service. Spotify currently also has deals with Universal Music, Sony Music, EMI, Warner Music Group and a handful of large indie labels. Spotify recently ran into a little trouble with some of its licensing deals and pulled a fair amount of its content off the site — or at least had to restrict access to which users could listen to the content based on their geographic location. The loss of some of its library seemed to have been a sink-or-swim moment and Spotify ended up with its head above water. Spotify has debuted a few albums through its site and picked up a handful of large label partners as well. The music service responded quickly to problems with labels and seems to have replaced a fair amount of the songs it got in trouble over with similar versions that users can legitimately access. Evolution is the name of the game for online music services.