Business Matters: Embracing the Chaos Earns TuneCore $10,000 from iTunes Match
Business Matters: Embracing the Chaos Earns TuneCore $10,000 from iTunes Match

Embracing the Chaos Got TuneCore $10,000 from iTunes Match
-- Embrace the chaos, get a check in the mail. TuneCore received $10,000 in royalties for the first 2 months of Apple's iTunes Match, CEO Jeff Price revealed in a blog post.

iTunes Match is a cloud-based service that costs $24.99 per year. It that creates an offline version of a person's digital music collection that can be streamed remotely from any connected Apple device. Apple acquired licenses from rights owners in order to create this cloud-based collection. iTunes Match scans the user's hard drives - PC and mobile device - against a licensed catalog of 20 million songs in the iTunes store and recreates the collection on Apple's servers. Only songs that don't match are uploaded individually. A user's cloud-based collection plays back at 256kbps AAC quality regardless of the file quality of the original file.

Apple creates value through its user-friendly, timesaving process of recreating existing music collections on its own servers. The cloud-based lockers of Amazon and Google are ordinary in comparison - each track must be uploaded individually, and uploads are not converted to a better quality file.

OK, so maybe $10,000 isn't a huge sum - but it's a start. "Some may complain that it's not much money," Price wrote. "Well, before you were getting zero, now you are getting something."

iTunes Match may not strike you as the most innovative digital service of all time, but it's actually quite forward-thinking. It's a rare example of the record industry embracing the chaos of the Internet. Large music companies are often chided for a failure to release the control they have on the copying and distribution of their works.

The "embrace the chaos" movement has led to calls for monetized peer-to-peer networks or an ISP levy that would allow broadband users to download music from whatever source desired. On the other end of the spectrum, fringe elements of the "embrace the chaos" crowd have called for an end to copyright so music can be copied shared and remixed without restrictions. What they have in common is a desire to see music being monetized in ways that doesn't inhibit how people discover, share and enjoy music.

While iTunes Match is hardly on par with an ISP levy, it's a big step forward from the transaction-based sales most familiar to the record industry (you sell a CD or download, you get paid). Rights owners get to protect the value of their copyrights while diverting from typical business models. They will even get paid for the use of their copyrights despite the questionable manner in which the music may have been acquired.
( TuneCorner Music Blog)


Tiesto: DJ/App

-- Tiësto, the biggest DJ in the world (he still holds that title, right?), has put out a 99-cent iPhone app that goes above and beyond the typical artist app. The app allows users to stream Tiësto's catalog, post to a dedicated social wall called Fan Connect, stream 1 hour of footage from his show at Home Depot Center in LA, and stream 1 hour of his weekly podcast and view the track list of his podcast archive. The app is AirPlay-enabled so users can stream all video from the app to Apple TV 2.

The app was developed with Tiësto along with Penté Group, the developer behind a series of Bob Marley apps, the official app of the Juno Awards and Polaroid Instant Camera for the iPhone. Early customer reviews at iTunes have been great: 23 reviews with an average of five out of five stars.

Endless: The Bandwidth Consumed Bickering Over Piracy Damages Amounts
-- Is too much bandwidth consumed bickering over the exact amount of damages caused by piracy? Here's a really common sequence of events: A trade group tries to quantify the impact of piracy, then critics base their opposition to the trade group's efforts based on disagreement over those numbers.

Take a recent article in the New York Times titled "In Piracy Debate, Is The Sky Falling?" Here are the exact figures quoted in the article, which come from a letter from the Motion Picture Association of America: "…$58 billion is lost to the U.S. economy annually due to content theft, including more than 373,000 lost American jobs, $16 billion in lost employees' earnings, plus $3 billion in badly needed federal, state and local governments' tax revenue."

Estimating losses due to piracy with this level of certainty - not that vague estimates would be any better - opens trade groups up to critics. Art Brodsky from Public Knowledge told the Times the movie industry's estimates of losses from piracy don't correlate to the state of the industry. The Times pulled out a blog post from Tim O'Reilly, Founder and CEO of computer book publisher O'Reilly Media, that said there is "no discussion of credible evidence of this economic harm." What he's saying is that piracy is a problem, but not that big of a problem.

Then the Times floated a contrarian view. In that same blog post O'Reilly says "losses due to piracy are far outweighed by the benefits of the free flow of information, which makes the world richer, and develops new markets for legitimate content." That kind of argument is not uncommon these days. But by that logic a person can rationalize all sorts of illegal and undesired behavior. Take any money-saving activity and you can argue there will be a multiplier effect that increases cash flow in other areas of the economy. Using patents without the proper consent means a manufacturer can pass along the savings in the form of lower prices to consumers, which gives them more money to spend on vacations, which improves not only the travel industry's fortunes but also the overall happiness of the country's workforce.

The exact size and shape of piracy is hard to define. Exacerbating the difficulty of having an intelligent dialogue is the fact that piracy can have benefits - a promotional value for artists and authors, for example - even as it undermines entire business models (even growing and successful ones like iTunes). But most everyone, Tim O'Reilly included, believes piracy is a problem. There may be disagreement over the finer points, but at least there's agreement on the major point.
( New York Times)

Questions? Comments? Let us know: @billboardbiz

Print