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Spotify Invests $10M In Facebook's Libra Cryptocurrency  

Spotify Invests $10M In Facebook's Libra Cryptocurrency

Spotify has officially joined Facebook's new Libra global cryptocurrency initiative. Spotify stands out as the only music or media company among 28 A-list players ranging from Visa to Uber to Andreessen Horowitz that each invested $10 million. 

Here's of Techcrunch describes Libra: "Facebook wants to make Libra the evolution of PayPal. It’s hoping Libra will become simpler to set up, more ubiquitous as a payment method, more efficient with fewer fees, more accessible to the unbanked, more flexible thanks to developers, and more long-lasting through decentralization." 

All that delivered locally on a global scale and with bitcoin tracking built in, and you get some idea of what a massive project this is. 

Why Spotify? 

For Spotify, Libra offers a chance to more easily receive payments globally, including from the many outside the banking system.  Someday soon, Libra could facilitate payments to artists and rights holders, as well. 

Alex Norström, our Chief Premium Business Officer, explains: 

“One challenge for Spotify and its users around the world has been the lack of easily accessible payment systems – especially for those in financially underserved markets. This creates an enormous barrier to the bonds we work to foster between creators and their fans. In joining the Libra Association, there is an opportunity to better reach Spotify’s total addressable market, eliminate friction and enable payments in mass scale.”

Apple Reportedly Ending iTunes 

Apple Reportedly Ending iTunes

The file organization system you've been finding ways to work around for over a decade is about to be no more. According to a report from Bloomberg, Apple is hoping to phase out iTunes in the near future. Apple CEO Tim Cook is expected to announce the decision to move away from iTunes as part of a push away from the iPhone in coming years. 

Guest Post By Alex Galbraith

Unveiled in 2001, iTunes originally functioned as a music library and marketplace for iPods, iPhones, and Mac computers. As the company shifts its focus to other arms, the iTunes library will be replaced by separate desktop apps: Music, Podcasts and TV. iPhones and iPads already separate out libraries in this manner. 

The company's Worldwide Developers Conference is a closely watched event for fanboys and journalists. At this year's iteration, the company is also expected to announce greater freedom for their Apple Watch, which currently only works if it is connected to an iPhone. 

While the company is looking to roll out a new iPod soon, the move away from iTunes is probably a savvy business move given the recent raft of bad press attached to the brand. The company is currently being sued by users who allege that their iTunes data was sold to third parties who connected the data to personal information to sell to marketers. 

“None of the information pertaining to the music you purchase on your iPhone stays on your iPhone," the $5 million lawsuit alleged, per Billboard. “The data Apple discloses includes the full names and home addresses of its customers, together with the genres and, in some cases, the specific titles of digitally-recorded music that its customers have purchased via the iTunes Store and then stored in their devices.”

Here comes Amazon! 

Here comes Amazon!

Courtesy of Music Business Worldwide

Less than a week after the online giant launched its first fully free music streaming service, MBW has caught wind of the company’s next big plan to challenge the likes of Spotify. 

We understand that Amazon is currently in discussion with various large music rights-holders regarding the upcoming launch of a high fidelity music streaming platform – and that at least one major record company has already agreed to license it. 

I've heard this whisper from several high-placed music industry sources, who say the price of Amazon’s new tier will likely be in the region of $15 per month. It’s expected to launch before the end of 2019. 

“It’s a better bit rate, better than CD quality,” said one source. “Amazon is working on it as we speak: they’re currently scoping out how much catalog they can get from everyone and how they’ll ingest it.” 

The best known existing hi-def music streaming offering comes from TIDAL, whose TIDAL Hi-FI subscription tier costs $19.99 per month and offers CD-quality lossless streams at 44.1 kHz / 16 bit. 

In addition, TIDAL also offers a ‘Masters’ quality offering for pickier audiophiles, which presents thousands of albums at 96 kHz / 24 bit via desktop. 

“WITH AMAZON MAKING THIS MOVE, IT FEELS LIKE A POSITIVE STEP FOR PRICING FLEXIBILITY. SPOTIFY HAS JUST BEEN OUTMANEUVERED.” 

SENIOR INDUSTRY SOURCE 

TIDAL’s ‘Masters’ range is made possible by its partnership with digital hi-def music company MQA. It’s understood that Amazon has not partnered with MQA for its own HD tier. 

Meanwhile, Deezer offers a HiFi tier at a standard price of $19.99 per month, which, like TIDAL’s equivalent, streams music at 44.1 kHz / 16-bit via FLAC files. 

The world’s two biggest music subscription streaming platforms – Spotify and Apple Music – are yet to venture into the world of high fidelity audio. 

Will Amazon’s exploration of a launch in the area trigger their interest? 

A further senior US-based music industry source says, “Think about it: Amazon will have every tier of recorded music covered, from free streaming through to limited catalog via Prime, a full ‘Spotify rival’ in Music Unlimited and a hi-definition service – in addition to vinyl, CD, merch and more. We haven’t seen anything near what they’re capable of in music yet.” 

They added: “So far, Spotify and Apple have resisted launching a higher-price streaming tier, and [the labels] have resisted giving more away for the same [$9.99 a month] price. 

“With Amazon making this move, it feels like a positive step for consumer pricing flexibility, and good news for streaming ARPU generally. Spotify has just been outmaneuvered.” 

The launch of Amazon’s free music service on Alexa last week introduced an entry-level tier Amazon’s music streaming ecosystem. 

Amazon customers wishing to hear on-demand music without ads can upgrade to a Prime membership, which will offer them more than 2 million songs to choose from. And if an Amazon customer wants full, on-demand access to more than 50 million songs, they can sign up to Amazon Music Unlimited – for which a subscription locked to a single Echo device will cost $3.99 per month. 

For access to Amazon Music Unlimited across multiple devices, customers pay a $9.99 per month subscription, although those who already pay to be Amazon Prime members only need pay an additional $7.99 per month.

Amazon’s Ad Supported Strategy Goes Way Beyond Music 

Amazon is reportedly close to launching an ad supported streaming music offering. Spotify’s stock price took an instant tumble. But the real story here is much bigger than the knee-jerk reactions of Spotify investors. What we are seeing here is Amazon upping the ante on a bold and ambitious ad revenue strategy that is helping to reformat the tech major landscape. The long-term implications of this may be that it is Facebook that should be worrying, not Spotify. 

Guest Post By MIDiA analyst Mark Mulligan from his Music Industry blog 

In 2018 Amazon generated $10.1 billion in advertising revenue, which represented 4.3% of Amazon’s total revenue base. While this is still a minor revenue stream for Amazon, it is growing at a fast rate, more than doubling in 2018 while all other Amazon revenue collectively grew by just 29%. Amazon’s ad business is growing faster than the core revenue base, to the extent that advertising accounted for 10% of all of Amazon’s growth in 2018. 

"Spotify builds audiences to deliver them music (and then monetize), Amazon is now building audiences in order to sell advertising" 

Amazon is creating new places to sell advertising 

The majority of Amazon’s 2018 ad revenue came from selling inventory on its main platform. This entails having retailers advertise directly to consumers on Amazon, so that Amazon gets to charge its merchants for the privilege of finding consumers to sell to, the final transaction of which it then also takes a cut of. In short, Amazon gets a share of the upside (i.e. the transaction) and of the downside (i.e. ad money spent on consumers who do not buy). This compressed, redefined purchase funnel is part of a wider digital marketing trend and underlines one of MIDiA’s Four Marketing Principles. 

But as smart a business segment as that might be to Amazon, it inherently skews towards the transactional end of marketing, and is less focused on big brand marketing, which is where the big ad dollar deals lie. TV and radio are two of the traditional homes of brand marketing and that is where Amazon has its sights set, or rather on digital successors for both: 

Video: Amazon’s key video property Prime Video is ad free. However, it has been using sports as a vehicle for building out its ad sales capabilities and has so far sold ads against the NFL’s Thursday Night Football. It also appears to be poised to roll this out much further. However, Amazon’s key move was the January launch of an entire ad-supported video platform, IMDb Freedive. Amazon has full intentions to become a major player in the video ad business. 
Music: Thus far, Amazon’s music business has been built around bundles (Prime Music) and subscriptions (Music Unlimited). Should it go the ad-supported route, Amazon will be replicating its video strategy to create a means for building new audiences and new revenue. 

It’s all about the ad revenue 

Right now, Amazon is a small player in the global digital ad business, with just 6% of all tech major ad revenue. However, it is growing fast and has Facebook in its sights. Facebook’s $50 billion of ad revenue in 2018 will feel like an eminently achievable target for a company that grew from $2.9 billion to $10.1 billion in just two years. 

To get there, Amazon is committing to a bold, multi-platform audience building strategy. Whereas Spotify builds audiences to deliver them music (and then monetize), Amazon is now building audiences in order to sell advertising. That may feel like a subtle nuance, but it is a critical strategic difference. In Spotify’s and Netflix’s content-first models, content strategy rules and business models can flex to support the content and the ecosystems needed to support that content. In an ad-first model, the focus is firmly on the revenue model, with content a means to an end rather than the end. (Of course, Amazon is also pursuing the content-first approach with its premium products.) 

Amazon is becoming the company to watch 

So, while Spotify investors were right to get twitchy at the Amazon rumours, it is Facebook investors who should be paying the closest attention. Amazon’s intent is much bigger than competing with Spotify. It is to overtake Facebook as the second biggest global ad business. None of this means that Spotify won’t find some of its ad supported business becoming collateral damage in Amazon’s meta strategy – a meta strategy that is fast singling Amazon out as the boldest of the tech majors, while its peers either ape its approach (Apple) or consolidate around core competences (Google and Facebook). Amazon is fast becoming THE company to watch on global digital stage.

Songwriters Urge Users To #CancelSpotify 

#cancelspotify A growing group of songwriters are taking to social media to urge users to #cancelspotify in protest of the streamer's decision to challenge a US Copyright Royalty Board decision to raise streaming payments to songwriters 44% over the next 5 years. 

Yesterday dozens of top songwriters called out Spotify in an an open letter that urged the streamer to reverse course: "Now, we can see the real reason for your songwriter outreach. You have used us and tried to divide us but we stand together." 

While #cancelspotify is far from trending on Twitter, the campaign does appear to be gathering some momentum.

What do you think?

 

European Union Passes Sweeping Copyright Reforms, Ending Safe Harbor For YouTube 

European Union Passes Sweeping Copyright Reforms, Ending Safe Harbor For YouTube

Guest Post By: Richard Smirke

Record labels, publishers, songwriters and artists have welcomed the passing of controversial copy- right reforms that will transform how user-generat- ed-content (UGC) services like YouTube operate in Europe. 

Members of the European Parliament (MEPs) voted in favor of the EU’s Copyright Directive by a majority of 348 votes for, 274 against and 36 abstentions. The run-up to the vote saw public protests in a number of European cities and an unprecedented multi-million dollar lobbying campaign from the tech sector and Google, which owns YouTube. 

The European Union has laid the foundation for a better and fairer digital environment — one in which creators will be in a stronger position to negotiate fair license fees when their works are used by big online platforms,” said Gadi Orondirector general of CISAC, the International Confederation of Societies of Authors and Composers, following the vote at the European Parliament’s seat in Strasbourg, France. 

Oron called it a “hugely important achievement” that will “lead the way for countries outside the EU to follow.” 

Before MEPs could vote on the final bill, the European Parliament ruled against a number of last minute amendments from MEPs unhappy with the final text. 
The proposed amendments included the deletion of Article 13 (renamed Article 17 in the consolidated text), which requires UGC platforms like YouTube to agree “fair remuneration” license deals with rights holders and makes them legally liable for hosting unlicensed content, effectively ending safe harbor immunity. 

In practice, that’s likely to involve YouTube using a stricter filtering system, although upload filters are not mentioned anywhere in the text and the directive does not specify what methods or tools platforms must use to block illegal content. Despite the objections of a select number of MEPs, Article 13 remains a key component of the copyright directive that was passed.

“Four years of titanic tussling later, our work to solve the ‘Value Gap’ now begins a new stage after this vote. Namely, to ensure that those who make the music make a fair return,” said John Phelan, director general of international music publishing trade association ICMP. 


Now that the legislation has been officially passed, all 27 EU member countries — a list that includes Germany, France, Sweden, Spain, Italy and the Netherlands — will have two years to transpose the directive into national law. Before that process can begin, member states will need to re-approve the Parliament’s decision on the EU Statute Book, most likely in early April, which is traditionally seen as a rubber-stamping exercise. 


It is not yet clear if the United Kingdom, the world’s fourth biggest music market, will adopt the legislation after it leaves the European Union, although it’s thought that if a Brexit withdrawal deal can be agreed, its laws would apply during any transition period. 

“This world-first legislation confirms that User-Upload Content platforms perform an act of communication to the public and must either seek authorisation from rightsholders or ensure no unauthorised content is available on their platforms,” said Frances Moore, CEO of international labels trade body IFPI, who thanked law makers for “navigating a complex environment” to pass the bill. 

Responding to the vote, Google Europe tweeted, “The #eucopyrightdirective is improved but will still lead to legal uncertainty and will hurt Europe’s creative and digital economies. The details matter, and we look forward to working with policy makers, publishers, creators and rights holders as EU member states move to implement these new rules.”

Max Martin, UMG, Avid, DDEX, Session Announce the ‘World’s First End-to-End Music Credits Ecosystem’ 

Max Martin, UMG, Avid, DDEX, Session Announce the ‘World’s First End-to-End Music Credits Ecosystem’

Let’s give these artists some credit. 

Guest Post by: Paul Resnikoff

Photo: Session CEO Niclas Molinder (l) with ABBA member and Session co-founder Bjorn Ulvaeus (r) at SXSW.

Last week, a consortium of industry and artist associations banded together to underscore the importance of a “more robust and effective system of digital attribution and credits.” 

In a joint statement, the Artist Rights Alliance, SAG-AFTRA (Screen Actors Guild–American Federation of Television and Radio Artists), RIAA (Recording Industry Association of America ) and A2IM (American Association of Independent Music) urged the industry to double-down on proper artist crediting and metadata. 

“Attribution recognizes artistic achievement, helps creators connect, collaborate, and appreciate each other’s work, opens up new pathways for fans to trace artistic influences, and find new music, and aids accuracy in the digital royalty economy,” the joint statement urged. 

Now, there’s a concrete effort to more seriously address credits, missing metadata, and black box royalty problems. 

At SXSW, a separate consortium has proclaimed the ‘world’s first end-to-end music credits ecosystem’. 

The bold initiative, called Creator Credits, is being led by a heavyweight alliance that includes Max Martin’s MXM Music, Avid Technology, Universal Music Group and DDEX.  Session, led by co-founder (and ABBA member) Bjorn Ulvaeus and CEO Niclas Molinder (pictured above), is corralling the circle of power-players. 

In an announcement at the Hilton Hotel in Austin, TX, Molinder underscored the importance of starting the process of credits immediately.  That would explain the presence of Avid, which owns Pro Tools. 

“I’m convinced that the best way to involve the creators in the data collection is as early as possible in the creation process,” Ulvaeus said during the unveiling.  “Session’s technology performs a short handshake with music society systems to authenticate creators and associate their vital industry identifiers with their account. 

“When a creator walks into a Pro Tools powered studio, their presence will be automatically detected and their identifiers, along with their typical contributions, can be easily added to a song.” 

That approach is a far cry from the typical afterthought afforded to music metadata and royalty credits. 

Instead, Session (formerly named Auddly) is taking a very aggressive approach by starting the credits process during the creation phase itself.  “The proof-of-concept sees Avid embedding Session’s technology into Pro Tools to automatically detect the presence of creators in the studio and allowing the addition of creator credits, contributions and crucial industry identifiers (IPI, IPN and ISNI) to a recording before it leaves the studio,” the company explains. 

“Creator credits can easily be added to a song throughout the production process by automatically associating industry authenticated songwriters, musicians, producers and editors and their contributions.” 

In other words: the credits for a song can be added before the song is finished. 

“With Pro Tools software at the core of many of today’s music production environments around the world, the Avid team shares in the vision that all contributors to a piece of music or any audio work should be clearly identified, recognized and rewarded appropriately throughout the production and distribution process,” said Francois Quereuil, Director of Audio Product Management, AVID. 

“We are particularly excited to enter a technology collaboration with Session and work with key players in the music industry to provide a durable solution to the challenges associated with capturing and recognizing creators’ credits in an increasingly complex digital world.” 

But here’s the really exciting part: these credits aren’t just getting added to a local file. 

Instead, they’re being automatically pushed downstream to managers, labels, music publishers, PROs, distributors and streaming platforms.   That aggressive push is mandatory for proper downstream payments, especially given the spotty distribution of metadata across the fractured music industry ecosystem. 

The presence of Universal Music Group will also add some serious momentum to this initiative.  But Barak Moffitt, EVP of Content Strategy and Operations at UMG, says the two companies have been working together on metadata and credits for a few years.  “In addition to our own efforts, we have been working closely with Bjorn and Niclas for a couple years on the development of this platform as part of our commitment to a robust and effective crediting system for the benefit of the entire music ecosystem,” Moffitt relayed. 

DDEX, the supply chain data standards organization, has also been toiling away on music metadata standards for years — if not more than a decade.   Accordingly, the creator credits metadata will travel downstream to various music industry players in the ‘DDEX RIN’ standard format.  That will include critical industry identifiers for songwriters (IPI) and performing artists (IPN), as well as the emerging ISNI identifier. 

This creator identification information, along with their contributions to the recording and song, are assembled with the ISRC (recording identifier) and ISWC (composition identifier) codes.  That will enable downstream music platforms to improve their matching, payouts and even value-added features. 

The initiative comes at a moment of serious frustration for the music industry. 

With the ink dried on the Music Modernization Act (MMA), the industry is now arguing over an estimated $1.2 billion in unattributed ‘black box’ mechanical royalties being held by the likes of Spotify, Apple Music, and Amazon Music Unlimited.  And that’s just one piece of a gigantic black box whose size is estimated to be in the multi-billions.

Spotify and Amazon 'sue songwriters' with appeal against 44% royalty rate rise in the United States  

Spotify and Amazon 'sue songwriters' with appeal against 44% royalty rate rise in the United States 

A recent Copyright Royalty Board (CRB) ruling brought great news for songwriters in the US – with royalty rates for streaming and other mechanical uses set to rise 44% in the market. 

Spotify and Amazon have now officially come out in opposition to that ruling, in what the National Music Publishers Association (NMPA) has called a "shameful" move which equates to "suing songwriters". 

On January 27, 2018 MBW reported on the CRB’s landmark ruling, which stated that royalty rates paid to songwriters in the US from on-demand subscription streaming would rise by 44% over the next five years. That decision was ratified last month (February 5), when the CRB published the final rates and terms for songwriters. 

Streaming companies were given 30 days to lodge official opposition to the ruling if they wished. The likes of Apple Music declined to do so – but it's a different case for Spotifyand Amazon, which have now both filed a notice of appeal against the 44% royalty rise. 

In a statement today (March 7), the NMPA said that a "huge victory for songwriters is now in jeopardy" due to the streaming services’ filing. 

NMPA President & CEO David Israelite commented: “When the Music Modernization Act became law, there was hope it signaled a new day of improved relations between digital music services and songwriters. That hope was snuffed out today when Spotify and Amazon decided to sue songwriters in a shameful attempt to cut their payments by nearly one-third. 

He added: "The CRB’s final determination gave songwriters only their second meaningful rate increase in 110 years.

Instead of accepting the CRB’s decision which still values songs less than their fair market value, Spotify and Amazon have declared war on the songwriting community by appealing that decision." 

SOUNDCLOUD IS NOW A DISTRIBUTOR: PLATFORM LAUNCHES TOOL FOR USERS TO UPLOAD MUSIC TO SPOTIFY, APPLE MUSIC ETC. 

Guest Post By Tim Ingham/ Music Business World February 19, 2019

The upgrade to the platform’s SoundCloud Premier monetization toolset allows users to “seamlessly” distribute their music to the likes of Amazon Music, Apple Music, Instagram, Spotify, Tencent, YouTube Music and more – all from within their SoundCloud account. 

Subscribers to either of SoundCloud’s upload offerings (SoundCloud Pro and Pro Unlimited) can gain access to SoundCloud Premier at no extra cost.

Premier’s core selling point is that it allows artists to monetize their music on SoundCloud, earning a revenue share which the company says “meets or beats every [other] streaming service”. 

In terms of the new distribution tool, SoundCloud says it’s not taking any cut from the earnings artists obtain on other platforms, while it promises “streamlined payments from everywhere – directly from SoundCloud”. 

“Only SoundCloud empowers creators with a unified platform to instantly upload and share, connect with fans in real-time and get paid for their work everywhere –both on SoundCloud and across other leading music services,” said Kerry Trainor, Chief Executive Officer, SoundCloud. 

“Creators can now spend less time and money jumping between different tools, and more time making music, connecting with fans and growing their careers first on SoundCloud.”

The move comes a few months after Spotify announced that it was also effectively becoming a multi-platform distributor. Daniel Ek’s company acquired a minority stake in third-party firm Distrokid in October last year, before launching a beta tool which made it possible for users to upload tracks to other services via the Spotify For Artists dashboard. 

Prior to rolling out its open beta distribution tool, SoundCloud worked with a number of artists including Leaf, mobilegirl, Jevon and Thutmose in a closed beta environment to test and get feedback on the new feature. 

“I believe SoundCloud’s new distribution tool is the way of the future for independent artists and music in general,” said rising rap artist, Leaf. “It makes distribution an easy one-step process, giving you a very simple way to monetize your plays and the freedom to reach new heights with your fan base.” 

Hip-hop producer and musician, Jevon, said, “SoundCloud’s distribution tool is a great way for unsigned artists to get their music out there for the world to hear. Everyone knows how easy it is to upload a song to SoundCloud, and now it’s just as simple to upload and distribute everywhere.” 

Over the course of the next few months, says SoundCloud, creators will see new functionality added to the monetization toolset – which is available for SoundCloud Pro or Pro Unlimited subscribers who own all applicable rights to their original music, and who are over 18 years old. 

To use the toolset, these artists must also have no copyright strikes against their music on SoundCloud at the time of enrollment. 

At last count, SoundCloud’s music catalog included over 200 million tracks from 20 million creators heard in 190 countries

SPOTIFY’S GLOBAL MONTHLY ACTIVE USERS TOP 200M, UP BY 20M IN THE PAST SIX MONTHS 

Spotify now has more than 200m monthly active users (MAUs) around the world. 

The news was broken by the service’s communications chief Dustee Jenkins, at CES in Las Vegas. 

Speaking in an interview yesterday (January 10), Jenkins revealed that the service broke through the 200m barrier last week.

That’s up by 20m on the 180m MAUs Spotify announced at the end of Q2 2018, and 9m on the 191m MAUs it announced in Q3. 

We’ll have to wait for Spotify’s Q4 earnings announcement (coming next month) to learn the company’s official year-end MAU tally for 2018.

In its Q1 2018 results announcement, Spotify projected that monthly active users would end 2019 somewhere between 198-208 million. By the time of its Q3 results, that top-end number had reduced slightly to 199-206 million. 

Judging by Jenkins’ comments, it looks like Spotify finished the year at the lower end of that margin. 

Speaking in an interview with Cheddar.com, Jenkins said: “It’s important to note [that] Spotify is the world’s largest global music streaming service, we’re about two times bigger than anyone else – in fact we just hit a major milestone a week ago, 200 million monthly active users. That’s a lot of people on the platform.” 

“WE JUST HIT A MAJOR MILESTONE A WEEK AGO, 200 MILLION MONTHLY ACTIVE USERS. THAT’S A LOT OF PEOPLE ON THE PLATFORM.” - DUSTEE JENKINS, SPOTIFY 

She added: “We’ve said all along, we want to focus on growth. We believe in being a profitable company, but first and foremost we have to grow and get to regions of the world that still don’t have Spotify. 

“There are still parts of the United States where Spotify is not widely used… the company has done a great job of prioritizing growth and making the service better, because there’s a lot of competition and we’re only as good as the user thinks we are so we have to continue to enhance our service.”