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Internet radio booming but threatened

San Jose Mercury News: Internet radio booming but threatened. Excerpt:

With a growing audience of up to 54 million monthly listeners, Internet radio is one of the biggest trends in digital music. But if you believe the industry's leaders, it's threatened with extinction.

They say the rates they have to pay the recording industry are bankrupting them. They're appealing the government-set rates, pressing Congress to change the rate structure and pursuing negotiations with the industry.

Now a congressman has stepped in to oversee the negotiations and Webcasters are ramping up the rhetoric.

"We're very supportive of paying royalties, but this structure is wrong, unfair and unaffordable," Tim Westergren, founder of Oakland-based Pandora, said in an e-mail to the Mercury News. ...

Small, independent AccuRadio owes about $67,000 a month in royalty fees this year, though its monthly revenue is only $40,000 to $50,000, said CEO Kurt Hanson.

The current fee structure is a disgrace and amounts to legal extortion imposed by the federal government on behalf of record companies.

An old rocker gets digital

NY Times:  Peter Gabriel, the rock musician, has become a powerful player in the emerging online music industry by helping artists find new ways to market their music.

'Sound Unbound'

MIT Press:

Sound Unbound: Sampling Digital Music and Culture. Edited by Paul D. Miller aka Dj Spooky that Subliminal Kid. Foreword by Cory Doctorow. Introduction by Steve Reich. If Rhythm Science (Miller's first book) was about the flow of things, Sound Unbound is about the remix--how music, art, and literature have blurred the lines between what an artist can do and what a composer can create. In Sound Unbound, author Paul Miller asks artists to describe their work and compositional strategies in their own words. These are reports from the front lines on the role of sound and digital media in an information-based society.

Mash-up model

Rob Walker at the Sunday New York Times Magazine: Mash-Up Model. Music you could never buy on iTunes tests the pay-what-you-want business model. Excerpt:

Girl Talk (real name Gregg Gillis) has also won critical praise but is not likely to land a big-time contract, commercial radio play, a spot in an iPod ad or even distribution on iTunes. This is because “Feed the Animals” is composed almost entirely of more than 200 samples of other artists’ music, ranging from Lil Wayne to Kenny Loggins — none of which Gillis has obtained permission to use.

This is what makes Girl Talk’s experimentation with the value of music so compelling. It’s one thing for various name-brand artists to dabble with giveaways. It’s something else for a creator who has operated artistically, financially and even legally outside the structures of the traditional recording business for his entire career to do so. Will “Feed the Animals” make Girl Talk a rock star? And what would that even mean?

The release is the 26-year-old Gillis’s fourth, and a CD version will be distributed in September by a small label called Illegal Arts. (You get the CD if you pay $10 or more for the download.) ...

Music labels still offbase

Chris O'Brien in the San Jose Mercury News: Music labels still offbase.

Napster opens MP3 store

San Jose Mercury News: Napster opens MP3 store.

Recording industry loses infringement suit

The Inquirer (via Shelly Palmer): The recording industry lost a major ruling in Atlantic v. Brennan when a federal judge in Connecticut ruled that merely making music available to other users is not evidence of copyright infringement. The judge also found that no proof of infringement was supplied by the record companies that brought the suit. With two of three findings going to the defendant, the case was thrown out.

A rare victory for common sense.

More teens ignore CDs in buying their tunes

San Jose Mercury News: More teens ignore CDs in buying their tunes.

Why is Universal Music selling unlocked songs?

From the December issue of Wired magazine: The angry mogul. Universal's CEO Once Called iPod Users Thieves. Now He's Giving Songs Away. The most interesting part comes near the end:

When I suggest to Morris that the labels gave Jobs license to create what was in effect an Apple Walkman that played only Apple cassettes, it's Caraeff who answers. "Looking back, the best thing we could have done would have been to mandate one format," he says. So why didn't that happen? Morris is happy to field this one. "It never crossed anyone's mind!" he exclaims. "We were just grateful that someone was selling online. The problem is, he became a gatekeeper. We make a lot of money from him, and suddenly you're wearing golden handcuffs. We would hate to give up that income."

Those cuffs get tighter every day. This year, 22 percent of all music sold in the US will move through iTunes. "If iTunes gets up to 40 or 50 percent, they'll have too much power for anyone else to enter the business," says James McQuivey, who analyzes the digital music industry for Forrester Research. If the labels want out, they have two choices: Find a way to unseat the iPod or allow iTunes' competitors to sell unprotected files that can play on Apple's ubiquitous device.

The future of the music industry

Forgot to blog this, from the November issue of Wired magazine: Free Music Now! Lala.com's Plan to Give Songs Away Could Upend the Industry. Excerpt:

Nguyen's complaint with the way music is sold online — whether it's CD purchases or downloads — is that there's no easy, legal way to listen to a song before you buy it. A 30-second snippet on Amazon.com or iTunes is rarely enough to form a good impression and certainly not enough to get a tune stuck in your head. Nguyen's solution: Give the music away. Later this year, his new company, Lala, will begin streaming any track or album the user selects, for free, betting that the chance to explore the sonic landscape will get listeners excited. As they take in artists and genres they might otherwise never hear, music fans are going to want to own the songs, Nguyen says — and Lala will be right there to make that possible, via whatever channel and format the customer prefers: downloading tracks, trading discs, or even (gasp) buying the CDs. It's a model he believes will revive the music industry.