Peter Kafka of All Things Digital, part of The Wall Street Journal Digital Network, confirms that one of my favourite music sites and Webware 100 Winner, Grooveshark, is being sued by EMI. Here is Grooveshark’s statement sourced from Peter’s post:
“For the past year, Grooveshark has been in talks with EMI Records and other copyright holders to negotiate licensing agreements for the use of their content. We are pleased to announce that over the past few months Grooveshark successfully concluded mutually bene?cial agreements with many artists, labels, and publishers that we hope to be a template for other such agreements with additional copyright holders.
Recently, EMI Records chose to abandon the template we’ve built with the help of other major copyright holders and opted for their traditional intimidation tactic of ?ling a lawsuit as a negotiating tool. We ?nd the use of this negotiating strategy counterproductive, as Grooveshark has been willing to conclude an agreement with EMI Records that is economically sustainable for both EMI Records and a start-up company the size of Grooveshark.
Grooveshark is run by a group of young and passionate musicians. We love music, we make music, and we believe that the use of all music should be paid for. We adopted this core philosophy at our inception and to date have concluded agreements with hundreds of record labels, major US performance rights organizations, and thousands of independent artists who support Grooveshark’s business model. (See: Grooveshark Artists)
As musicians, we support the rights of copyright holders and strive to sign sustainable agreements with all content owners, ensuring that all artists get paid– or we agree to remove content from our system in accordance with our DMCA Takedown Policy. We hope that EMI Records eventually follows the lead of the many forward-thinking labels we are already working with, who would rather get their artists exposure and a fair share of our revenue than block content access and force customers to illegal networks.
We understand that the economy of the digital music business is in a state of ?ux, and we hope to help ease this transition by providing the required new tools and services that lead to the next generation of the music industry. We respect the ownership rights of the major labels and publishers, and our core mission has always been to compete with piracy by offering a service that is genuinely better than what illegal networks offer, while also ensuring fair payment to copyright holders. Our next important step on our road to success is to conclude a mutually bene?cial agreement with EMI Records that is sustainable for both EMI and Grooveshark.”
Presumably in response to EMI’s recent formal complaint and Warner’s lawsuit last year, SeeqPod filed for Chapter 11 with the U.S. Bankruptcy Court of the Northern District of California two days ago. The music search engine which rolled out an attractive pay-for-play advertising programme for artists is liquidating its assets by selling its source code to developers for $5000, perhaps encouraging many services just like SeeqPod to emerge in the future. Yet another sorry day for the music industry…
SoundReef, currently in closed beta, has come up with an interesting angle in a very lucrative ‘indie’ music licensing market which YouLicense.com is competing in and PumpAudio ? acquired by Getty Images in 2007 for $42 million ? has already won a tidy share of. Offering online music licensing solutions for independent artists and small companies, SoundReef hopes to encourage new business by making it possible for clients seeking music for commercial use to license music by compensating the artist (or copyright administrator) with promotional effort. What a clever idea! As most commercial use of music is small-scheme with zero-budget, music buyers now have an alternative currency to barter with and it just so happens to be the most valuable commodity of all for bootstrapping artists: Exposure. Let’s see how this venture kicks off.
I’ve been following Bandcamp for a little while now (see earlier post) and I noticed today that the company made some revisions to its home page. Most notably, Bandcamp created a “features” page which lists the entire suite of tools and services. I was also delighted to learn that Bandcamp now provides Creative Commons licensing designations:
Under the Creative Commons licensing designations, artists who make their music public, in this case via Bandcamp, are providing limited rights to other artists and music fans who wish to remix, share, or use the music in a variety of ways without having to formally ask permission.
Music search engine, SeeqPod, that has already indexed (but not stored) 12 million songs, has been handed a formal complaint from EMI following a lawsuit from Warner last year. Unlike Pandora and Imeem, the company has not pursued licenses to provide “playable search results” maintaining that they are not responsible for content sources and, therefore, free from any obligation to the copyright holder. Legally questionable, Seeqpod has become very successful and the two major labels are probably going after it to settle on a mutual business model rather than to shut it down. The news prompted me to play with the system a little and I enjoyed learning about their artist-centric advertising progamme that’s highly targeted and cost competitive. Providing 5000 “exposures” (i.e. impressions) a month for $19.95, SeeqPod Echo is a nicely put together search-oriented advertising interface which may very well generate some relevant traffic for artists and music promoters who wish to tap into SeeqPod’s massive music listening community. I’m curious to learn how the conversion rates stack up.
Now here’s a novel idea: SongVest is a bidding platform for music copyrights. Bidders have the opportunity to own a stake in their favorite published songs and, in turn, collect the royalty cheques. The highest bidders also receive a personlised plaque to put up on their wall and show off their claim to music fame. The songwriter or copyright owner retains a majority stake in the song up for auction, therefore, retaining full control of its use. The songwriter also sets the minimum bidding price which, as you would expect, may be in the tens of thousands of dollars for a small piece of a commercially successful song.
SongVest positioned itself as a ‘memorabilia’ offering as opposed to a copyright market. This is a unique approach to tapping into music fans desperate to own a piece of something they love as opposed to a community seeking to capitalize on copyright transfers and administration. Both scenarios are viable, though.
The essence of owning a piece of copyright is to ensure that the copyright is associated with something broadly admired, reputed, and very well known. Indie’s hoping to gain coverage out of this venture are unlikely to succeed. For SongVest, getting A-list songs is paramount and they seem to be on their way having already featured songs made famous by Carrie Underwood, Ozzy Osborne, Cher, Ringo Star, and The Monkees.
Kyte, the San Francisco based company providing turn-key solutions for online and mobile digital content production, distribution and monetization, has announced the launch of custom iPhone and iPod Touch apps as a new means for music fans to access their favourite artists’ music, videos, news, and exclusive content. In a separate affair, 90’s rock group, Presidents of the United States of America, who made a name for themselves with “Lump” and “Peaches”, have just released their own iPhone app along the same lines. For $2.99, fans can stream the band’s entire catalogue over a Wi-Fi or cellular connection, as well as gain access to exclusive content and previously unreleased music. This is exciting music industry news! iPhone apps are hugely popular and provide an unparalleled platform for artists to access their audience and visa versa. It won’t be long before we see more and more artists, from megstars to indies, harnessing this technology to promote themselves, monetize their catalogue, and upsell associated initiatives and assets such as concert tickets and merchandise.
TuneCore, the do-it-yourself digital music distribution platform, landed $7 million in a recent round led by Opus Capital. The company offers immediate access into stores like iTunes, and poses serious competition to existing indie distribution companies like CD Baby.
Artists can distribute their albums or individual tracks across a number of digital music stores for under $30, and keep the royalties, a model that has yet to be tried and tested by the major digital distributors on behalf of long tail clients.
“This is a very sad day for Pandora, and for me personally. Today we reduced our staff from 140 to 120 employees. Like virtually every company, Pandora is not immune to the challenges presented by the current economic turmoil. We are trying to react quickly and responsibly to the new environment…
There are tough times ahead for the economy, but our listenership is growing rapidly, the Internet radio royalty rate resolution seems finally near, and the explosion of mobile devices like the iPhone are opening up a world of opportunity for internet radio to expand off the desktop. Moreover, our ad sales are growing so well that, not only did we not make any reductions there, we need to continue to hire more.”
Now here’s a novel idea: 
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