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Disruptive Competitor to Traditional Collection Societies Launches Dynamic Service

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Paris, France based upstart Jamendo (URL: http://www.pro.jamendo.com) has launched a new service of background music for businesses like bars, restaurants, hotels and shops. This new service adds to its prior offering of licensing background music for live events and audiovisual production companies. The business has a catalogue of 180000 tracks, which are not registered with any collection society. All artists have provided their permission for the music to be used.

The service is available in eight different languages and this is what TMV view as groundbreaking. It is the one company, licensing, delivering, tracking and collecting money based on song plays. The ability to undertake this in 8 languages (with more in the pipeline) is a “killer USP” in terms of customer service.

Jamendo do a 50/50 split with all artists signed up to the service. All music within the service is based around the creative commons licensing principals. TMV do think the split is inequitable with the current splits between artist and Jamendo. It is definitely not competitive with traditional collection societies that generally pay 85% of all collected revenues on average to artists and publishers.

However, Jamendo do note that they have to provide the online digital service for the business where all the music is streamed from, or indeed where they do not have internet connections, they provide the business with a set top box.

The service claims it is more economical in terms of its competitor collection societies on a global basis – and with monthly fees (URL: http://pro.jamendo.com/en/product/publicspace) starting at €8 per month for a 100 sq meter business, TMV cannot help but agree it is cheaper. However, does that not just mean the artist gets less? Well yes it does in the traditional sense. Jamendo counters that these same artists would never receive payment from a traditional collection society, so in actual fact it is generating income for artists who traditionally would not have been received any revenue from these services.

TMV agrees that collection societies do need to stop their archaic monthly diary censuses of airplay to decide which artist and publishers get paid what. Quite simply they are skewed in favor of larger major label-based artist to the detriment of the independent music sector. Digital technology for tracking radio, broadcast and other formats song plays in the most accurate manner possible have been in existence for nearly 10 years.

Drilling down further, it is TMVs view that the nationalistic based focus and fragmented interests within the traditional incumbent collection societies, preventing their necessary movement into the 21st digital century. These same reasons are what lead large collection societies to provide second-class service to their smaller member writers. Over the longer term this has stagnated the ability for new and innovative music services to license music, which by the way music fans love.

Many large digital players like online streaming radio stations al-la Pandora (URL: http://www.pandora.com/restricted) or Last.fm (URL: http://www.last.fm/music/eaststrikewest) and others, would go further stating that collection societies are what has helped to make their lives hell in what they term “extortionate” licensing rates they are required to pay when it comes to licensing music. TMV would counter however that artists do require fair payment for their musical works.

Models based around digital broadcasting need to adapt their business models to ensure artists receive fair payment for their music. Currently, it sounds like streaming music services blaming the artists for the problems they experience business wise. Bottom line without artists these models do not have a business. Subsequently, your business model needs to recognize the value of music and not in actual fact devalue it.

On the flip side incumbent collection societies cannot deny they make licensing music on a global basis almost impossible. And when it does work the process is as excruciatingly painful – like having your teeth ripped out, but slower and more drawn-out without any painkillers. The fact Jamendo is international and targeting all the key territories on a global basis does necessitate that incumbent societies take notice that their territory is being challenged by a new and disruptive service.

TMV do believe Jamendo’s model is driving the potential direction traditional collection societies need to move in. The fact that they host and deliver via online streaming or set-top boxes is innovative. Reinforcing this is the fact all payments are based on actual song plays not totally inaccurate and frankly indefensible monthly diary censuses.

Over the long-term TMV can see many large digital music services migrating to such a service as Jamendo’s, especially as its catalogue grows and has a viable scale. Quite simply they will use Jamendo because it cuts through the nightmarish red tape. Furthermore, it is international and they can do one deal to license music globally within minutes and in the language of their choice.

However, for Jamendo to attract both established artists and publishers alike they urgently need to adjust their business model in terms of payment splits between itself and member writers. Until they do the service will not have any hope of attracting large artists. TMV does believe it should be targeting both publishers and established artists as the dynamics of global deals, real-time, transparent and accurate reporting to its members is groundbreaking and should be applauded.

 

 

Author

  • Wayne Rosso

    Wayne Rosso has worked in music and technology for decades. He has worked with such artists as Aerosmith, Bee Gees, Crosby, Stills & Nash, Public Image LTD., Beach Boys, Phillip Glass, Fleetwood Mac, Rick James, New Kids on the Block, Slash, Evanescence and scores of others.

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