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November 23, 2009 10:59 AM PST

Economics dooming free streaming sites?

by Matt Rosoff
  • 16 comments

For the last year or so, it's become clear that the economics of ad-supported streaming music services are not good for their creators or investors. As CNET's Greg Sandoval reported last week, the acquisition of streaming service Imeem by MySpace Music for pennies on the dollar is the latest bad news for the sector, following the bankruptcies of SpiralFrog and Ruckus and the similar fire sale of iLike to MySpace.

Offering your music via Spotify might help you fill up your piggybank.

Who's left? In the U.S., we've still got LaLa, which has the blessing of the major labels and seems to be enjoying dramatically increased traffic (as measured by Alexa) thanks to its recent deal with Google, and Grooveshark, which has kept a low profile. Neither of these services is purely ad-supported--particularly LaLa, which hopes to charge customers for downloads and "permanent" streams once they surpass a quota of 50 free streams a month.

But the service most often cited as the future of online music is Spotify. It's only available in Europe right now, but it seems like everybody who tries it loves it, myself included. Spotify offers a premium service as well, which offers portability and higher-quality streams, but the free service offers unlimited ad-supported streams, and that's the service that has everybody so excited.

But there's one small problem with the Spotify-as-savior story: it doesn't pay artists very well. According to this story in a Swedish publication, as translated and explained by the TorrentFreak blog, Spotify delivered more than one million streams of Lady Gaga's hit single "Poker Face" over five months. From these streams, she reportedly earned about 1,150 Swedish kronor--about $167--from the Swedish agency responsible for paying royalties. That's not even enough to cover the cost of four tickets to her upcoming concert in San Francisco.

If this story's true, why would any artist agree to make songs available on Spotify? With these kinds of payouts, it looks like music business expert Donald Passman is right--advertising is never going to support an online music service.

Originally posted at Digital Noise: Music and Tech
Matt Rosoff is an analyst with Directions on Microsoft, where he covers Microsoft's consumer products and corporate news. He's written about the technology industry since 1995, and reviewed the first Rio MP3 player for CNET.com in 1998. He is a member of the CNET Blog Network. Disclosure. You can follow Matt on Twitter @mattrosoff.
November 3, 2009 4:00 AM PST

Spotify: A love song

by Caroline McCarthy
  • 21 comments

I have a love song to write. I don't know yet whether it will be a tragic ballad or an exuberant ode to the triumph of happiness. But it's a love song for sure: I have fallen for Spotify, the latest buzzworthy "free music" service. After months of trying to find a great way to find and listen to music online, I believe I have met my match.

No, Spotify technically isn't available in the U.S. just yet, though the U.K.-based company hopes to bring the software stateside by the end of the year. My acceptance of an invite code sent by a generous friend therefore may or may not have been in gross violation of some international laws or statutes or regulations. But that's OK. Spotify, we can have an illicit romance for now.

You see, I needed this in my life. I had been thinking about "music discovery" of late. Last week, at the tail end of a trip in which I had been covering Google's splashy Los Angeles debut of its music search service in partnership with MySpace and Lala, I was sitting in the lobby of the Standard Hotel in West Hollywood, a shameless hipster magnet designed in the manner of tacky Southwest-desert motels and which features a constant soundtrack of semi-edgy music picks from '90s-era Britpop to lo-fi and LCD Soundsystem remixes. As a parade of attractive, Sunset Strip rocker types drifted to the check-in desk, I was sitting next to a cactus, intermittently holding up my iPhone to a speaker, using audio-recognition app Shazam to find out exactly what was playing.

Considering the cooler-than-thou crowd, I probably looked awfully silly. But Shazam has been my preferred method of music discovery because I just haven't found anything else I really like. Queuing up a Pandora station makes for great party music, but I've never been enthralled by its recommendations for me. Music blog aggregator Hype Machine has very well-done charts to track the songs that are getting blogged and tweeted about the most, but they can be a little bit predictable once you've already listened to the latest mashup of Kanye West and MGMT. I use Last.fm, owned by CNET News parent company CBS, to tabulate listening-history charts, but have never found myself hooked by its recommendations or radio stations. (Sorry, bosses.)

Social music and discovery services are a mess, frankly. Some of them have terrible user interfaces, and others are slowly becoming the victim of poorly conceived business models (many of which relied too heavily on advertising strategies that have yet to bear fruit) and ill-fated licensing agreements with the major labels. Still others, in striving to get a leg up on competitors, veered into editorial curation--exclusive album-listening debuts, promotions and tie-ins, and the like. That can make for a whole lot of clutter.

Then along came my Spotify invite, and everything changed. The service makes no attempts on the surface to be an "influencer" in and of itself, instead just offering access to full-length streams of just about any song. That's daunting at first. When you first load up Spotify, you're greeted with basic top-music charts that are notably uninspiring (Black Eyed Peas? Kings of Leon?) and searches don't bring you anything other than, well, what you searched for. Social-networking features like Facebook and Twitter sharing are sparse and well-hidden. If you don't know where to look, it can be a little bit dull.

Instead, the "discovery" process is left up to third parties. Create a playlist on Spotify, and you can assign it an HTML address so that when people click on it (assuming they have Spotify accounts) the playlist will open right up. A popular U.K. music blog called Drowned in Sound has a feature called "Spotifridays," where a selection of popular music from that week is packaged into a Spotify playlist, eliminating the need to click around through various Web browsers and streaming-music embeds. A friend sent me a link to Drowned in Sound's playlist of top songs of the first half of 2009. I was set for the next 7.6 hours.

Then, this happened: My Amazon MP3 bill started escalating as my "shopping cart" filled up with songs from bands I'd never heard of before, like the Veils, Let's Wrestle, and the Big Pink. The no-brainer Spotify platform, and how easy it is for anyone to use it to create playlists and share them in a way that doesn't involve a single wacky embeddable widget, was making me buy music.

But Spotify's long-term prospects are still hazy. Its dual business models, monthly subscriptions (for ad-free accounts and access to its iPhone app) and advertising for free accounts, have historically failed to hold up in the face of the micropayments-based iTunes. CEO Daniel Ek has even acknowledged that profits aren't flooding in yet and accused the labels of inflating licensing fees. The specter of SpiralFrog, another hyped free-music service that went down in flames earlier this year, is still in recent memory.

It's also unclear as to how the Spotify service, currently available in Sweden, Norway, the U.K., Finland, France, and Spain, will fare in the U.S. when it arrives here. Google's new music search feature, which is right now restricted to the States, may give a big advantage to competitors MySpace Music and Lala as search traffic is directed there. There's also the potential money drain: Government regulations over licensing fees last year. Digital music, you could say, is an industry with a lot of emotional baggage.

Generally, when there are glaring roadblocks in a new relationship, it's a red flag that you shouldn't get too attached. But this is one where I'm willing to fight to keep it alive. I hear there's a chance I'll be shut out of Spotify entirely in a few weeks unless I tweak my IP address somehow to fool the service into thinking I'm in one of its approved countries. Or unless I cough up the money for a premium subscription.

And I'd consider that. Money can't buy me love, but it could buy me Spotify. And right now they're sort of one and the same.

Originally posted at The Social
May 21, 2009 5:25 AM PDT

Hulu's first live-stream concert: Dave Matthews Band

by Caroline McCarthy
  • 13 comments

Want to feel old? This album came out 15 years ago.

Hulu will live-stream a concert for the first time: Dave Matthews Band at New York's Beacon Theater on June 1.

The online video hub, which announced the event Thursday, will be the only place streaming the concert live, at least legally.

Pop culture brush-up: the Dave Matthews Band was really, really, really huge in the '90s, known for lengthy live jams, for a Phish-like cult following that skewed more preppy than hippie, and for "Ants Marching," which was inescapable if you ever got anywhere near a frat house between 1994 and 1997. People generally loved them or hated them back then, due in no small part to the fact that they were the soundtrack of choice for the jocks rather than the indie kids or nerds.

It's a good fit for Hulu's first live concert broadcast--the site's first live streaming event was a presidential debate last October. The Dave Matthews Band's original Gen-X and Gen-Y fan base is exactly the demographic of 20- and 30-somethings--though not necessarily tech-savvy ones--who would tune into a concert stream online. And conveniently, the date of the show is the day before the band's long-anticipated new album, "Big Whiskey and the GrooGrux King," hits stores online and offline.

Frontman Dave Matthews was, on an unrelated note, one of the first mainstream musicians to use Twitter actively.

Hulu, meanwhile, is riding the wave of mainstream success in the wake of an edgy TV ad campaign and the big news that Disney would be joining News Corp. and NBC Universal as a partner in the joint venture.

May 5, 2009 10:36 AM PDT

Sony adds streaming, lyrics to its artist sites

by Matt Rosoff
  • 3 comments

Free, on-demand streaming music is a rising tide: since the start of 2009, I've covered relatively new services like Spotify and Just Hear It, and there are plenty of established players like MySpace Music, Imeem, and Grooveshark.

Listen to Michael Jackson's music on Michael Jackson's official Web site. What a novel idea!

(Credit: Sony Music, Michael Jackson)

Instead of trying to stop the tide, Sony Music has wisely embraced it: starting today, the company will introduce streaming music players on the Web sites of its most popular artists, including popsters like Kelly Clarkson, John Legend, and Jacko himself. It makes perfect business sense: instead of letting some third party like Imeem sell advertisements against high-demand music, Sony can sell or display its own ads.

Of course, they couldn't make it too easy--finding the audio on Michael Jackson's site took a few clicks, including one that forced me to identify my country, and the songs were embedded in the Sony-specific MyPlay player, which is an interesting piece of technology but only lets you create playlists with songs from other artists with MyPlay players. More generally, I wonder if it's too late for these label-specific initiatives--I'm sure plenty of hardcore Britney fans have her Web site bookmarked, but most music listeners probably prefer to use services that let you compile lists from multiple artists on multiple labels.

Sony is also adding lyrics to these artists' sites, provided by the company's own Gracenote subsidiary. Excellent move. I can't believe it's taken this long, given the lack of decent lyrics sites out there. In fact, I still don't understand the reluctance to publish lyrics online--what are people going to steal? What money is the artist or copyright owner losing? Kudos for Sony for taking a baby step toward ending this silliness.

Originally posted at Digital Noise: Music and Tech
Matt Rosoff is an analyst with Directions on Microsoft, where he covers Microsoft's consumer products and corporate news. He's written about the technology industry since 1995, and reviewed the first Rio MP3 player for CNET.com in 1998. He is a member of the CNET Blog Network. Disclosure.
January 3, 2009 6:34 PM PST

Music streaming service Spotify wins early fans

by Jennifer Guevin
  • 22 comments
Spotify logo

Move over, Pandora. There's a new music service in town--well, in some towns anyway.

TorrentFreak has an in-depth write-up of a new music streaming service called Spotify, which shows an awful lot of promise--so much so that the music piracy-focused blog sees it as a viable alternative to downloading pirated songs for free.

Spotify is a lean, downloadable application that lets users stream music instantly from its library--a library built with the blessing of EMI Music, Sony BMG, Universal Music Group, Warner Music Group, and some smaller record labels. That, of course, begs the question: how does it make money? Spotify offers two ways to use its service, a free service sponsored by ads, and a paid subscription service.

Once downloaded, the service allows users to search its music catalog by artist, genre, or title, and stream the tracks on-demand any number of times.

One of the cooler features is the ability to create and share playlists (a la the now-defunct Muxtape). And the service recently added the ability to scrobble the songs you listen to through Spotify on Last.fm.

That's the good news. Now for the bad news: It isn't officially available in the U.S. yet (though a Digg commenter did provide a way for people to try it out Stateside, at least temporarily). Right now it can be accessed in the UK, Germany, France, Italy, Spain, Finland, Norway, and Sweden. And the company plans to roll out its service to new markets in 2009, according to its Web site.

Judging from comments on TorrentFreak, Digg, and TechCrunch, the service seems to have impressed people who have tried it with its speed, usability, and depth of songs (though it's taken dings for sound quality, frequency of commercials, and lack of portability). I haven't had a chance to try it out yet, but as a music fan who got pretty fed up with the repetition of songs on Pandora's artist radio stations over the holiday break, I think this looks very promising.

As for TorrentFreak's claims that Spotify is so good that it might stop piracy in its tracks, I'm skeptical. This is a streaming service, so the songs are only available to you when you're online and connected to it. It doesn't work with portable music devices, so you can't take the songs with you on the subway or to the gym (or, for me, drop it into the iPod dock hooked up to my stereo). And since the songs aren't downloaded to your hard drive, they're not in your grand collection along with the rest of your music. Spotify might have a decent-size library, but it doesn't have all the songs I've ripped from vinyl, or the latest album from a favorite local band that happens not to have signed with a label yet. Going back and forth between a local library and a centralized library like Spotify would be annoying.

Having everything in one place and being able to take it with you wherever you go is the goal for any music fan. And until Spotify offers that ability, I don't see it magically wiping out music piracy altogether. But it does appear that this group is on the right track, from the perspective of music fans, bands, and music labels.

Has anyone spent a good deal of time with the service yet? If so, what say you? Is Spotify the wave of the future, or another Web 2.0 dud in an already cluttered arena?

Disclosure: Last.fm is a part of CBS Interactive, which also publishes CNET News.

September 23, 2008 5:59 PM PDT

Music groups reach accord on royalties

by Jennifer Guevin
  • 5 comments

Five music industry trade groups have reached what they call a breakthrough agreement on how royalties should be handled for streaming music online.

The groups, which represent record labels, music publishers, songwriters, and music Web sites, say their proposal would resolve what has been a source of strife between the music industry and Web sites that offer on-demand streaming services.

Under the agreement, sites like Napster and Imeem would have to begin paying royalties of about 10.5 percent of revenue. Download services like Amazon MP3 and iTunes already pay such fees. And online radio sites saw a major royalty hike last year. Pandora, one such site, may be on the brink of going out of business due to that rate increase, according to its founder, Tim Westergren.

The organizations involved were the Digital Media Association, the Nashville Songwriters Association International, the National Music Publishers Association, Recording Industry Association of America, and the Songwriters Guild of America.

They have submitted their plan to the Copyright Royalty Judges, a panel of copyright judges, for approval.

July 10, 2008 8:42 AM PDT

Photos: Hands-on with Pandora's Internet radio iPhone app

by Donald Bell
  • 3 comments
Photo of iPhone using Pandora Internet radio application.

For music lovers, the Pandora internet radio application for the iPhone and iPod Touch is a welcome addition.

(Credit: Donald Bell/CNET Networks)

Apple publicly unveiled the Pandora Internet radio iPhone and iPod Touch application during the unveiling of the iTunes App store on Thursday, July 10. Tim Westergren, CEO for Pandora, was kind enough to give me a personal tour of the new application. The following is a synopsis of just about every question I had for Tim. Editors' note: This is not an interview transcript, but a roundup of information on the Pandora iPhone application presented in a FAQ format.

Photo of Pandora iPhone app.

An option key allows you to bookmark artsist or songs, or purchase the current song directly from iTunes.

(Credit: Pandora)

How much will iTunes charge for the Pandora application?

It's free.

Will the iPhone version of the Pandora application stream music over the new 3G cellular connection?

Yes. New iPhones can use the Pandora app to stream music over 3G or Wi-Fi. Updated first-gen iPhones can stream over Wi-Fi or Edge, and the iPod Touch will obviously only stream over its Wi-Fi connection

What's the audio quality like?

Pandora's serves its iPod Touch and iPhone audio streams as 64Kbps stereo MP3 files; however, the quality and file format may be retooled once Pandora's tech team has some time to work with the new iPhone's hardware.

How will Pandora make money off a free application?

Pandora may eventually consider placing short audio advertisements in its streams, but, Pandora's first priority is to grow its user base.

Will Pandora stations I've already created using the Web service be available on the iPhone application?

Yes. Any stations, artist bookmarks, and song like/dislike preferences will be identical between the Pandora Web service and the Pandora application.

Photo of Pandora iPhone app.

You can create and save custom stations directly from the Pandora app.

(Credit: Donald Bell/CNET Networks)

What can I do with the Pandora application for the iPhone and iPod Touch?

Most of the features of Pandora's Internet radio Web service will be available on its iPhone application as well. People can create radio stations based around artists or songs, bookmark favorite artists or songs, pause and skip tracks, vote on songs, and view descriptions of why a currently playing song was included in your stream. You also have the option to purchase the currently playing song directly over the iTunes Wi-Fi store.


Photo of Pandora iPhone app.

Pandora's intelligent recommendation engine explains song choices.

(Credit: Donald Bell/CNET Networks)

Can I stream Pandora wirelessly from my iPhone over Bluetooth?

The iPhone does not currently support streaming stereo audio over its built-in Bluetooth; however, third-party Bluetooth audio adapters are available that fit any minijack audio output.

If I can connect my iPhone to my car stereo and stream Pandora over 3G, why would I listen to music on commercial or satellite radio?

Keep in mind that Pandora is a music-only service, so you'll need to get your talk radio, sports, and traffic reports elsewhere. That said, so long as you have decent 3G reception in your area, streaming Pandora internet radio to your car stereo via your iPhone should work fine.

Photo of Pandora running on iPhone.

Pandora's song voting system has made it to its iPhone app as well. Voting on songs helps fine-tune Pandora's personalized song recommendations. People can also pause and skip tracks.

(Credit: Donald Bell/CNET Networks)

Can I wake up to Pandora radio if I dock my iPhone or iPod Touch into an iPod alarm clock?

Not likely, since most alarm clock docks trigger song playback from your music library. Some iPod alarm clock docks include an auxiliary input, however, so if you kept music streaming from Pandora all night (and somehow managed not to run down your battery), then it's possible. Seems like a pain though.

Will Pandora music streams display album art?

Yes, although some music in Pandora's catalog is still without cover art.

Photo of Pandora iPhone app.

The Pandora playback screen looks much like the standard iPod playback screen, complete with cover art.

(Credit: Pandora)

Does the Pandora iPhone/iPod Touch application have the same limitations on track skipping as the Web version of the Internet radio station?

Yes. Because of legal restrictions, users cannot skip tracks on Pandora more than six times per hour. Fortunately, Pandora's Music Genome Project is pretty good at coming up with song selections.

Will using the Pandora iPhone application run down my battery quickly?

Yes. Reports so far suggest that the new iPhone's battery performance is at its worst when using its 3G connection. Streaming Pandora content over the iPhone's Wi-Fi connection should produce better battery performance than using 3G.

Originally posted at MP3 Insider
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