Business Matters: Optimistic About the Record Business? You're Not Alone
Business Matters: Optimistic About the Record Business? You're Not Alone

Optimistic About the Record Business? You're Not Alone
-- "I am optimistic," Tom Silverman wrote in the email that included a link to his latest fact-filled blog post. "What do you think?"

Silverman, of Tommy Boy Entertainment and the New Music Seminar, is optimistic about the sate of the record business. I think he has good reason to be optimistic. In a post at the blog of his New Music Seminar, Silverman walks readers through a litany of stats from 2011 that give reason to feel good about the state of the record business: strong growth in digital album sales, surprisingly resilient CD sales, CD sales on the Internet and healthy vinyl LP sales.

Silverman points to a few encouraging trends in digital music, too. One trend is growing digital performance revenue. Revenue from these royalties aren't just growing, they're becoming quite large. As Silverman notes, SoundExchange collected $95 million more in 2011 than in 2010, and projects to collect well over $400 million in 2012. (Silverman is a board member of SoundExchange, the organization that collects and distributes digital performance royalties to rights owners and artists.)

Another positive digital trend is growth in subscription services. Spotify just passed three million subscribers worldwide. Rhapsody has more than 1 million and Cricket's Muve Music has more than 500,000 just in the United States. Put simply, subscription services are helping bring excitement back to music.

Want a few more reasons to feel optimistic? Recorded music sales in early 2012 provide further -- albeit slight -- evidence of favorable trends. In the first three weeks of the year, album sales are up 3 percent, digital album sales are up 18 percent and track sales are up 7 percent, according to Nielsen SoundScan. OK, so these numbers cover only the first three weeks of the year. But trends seen later in the year tend to show up this early. If sales are holding up this well through three weeks, they could very well continue to hold up late in 2012.

CD sales are down nearly 7 percent in the first three weeks of the year. But if there is a silver lining in a 7-percent drop in CD sales it is that digital gains exceed the loss in physical sales. Through Jan. 22, digital album sales are up 1 million units and CD sales are down about 640,000 units compared to the same period a year ago. Including other physical formats, the net gain in album sales so far this year is 418,000 units.

Silverman believes the music business is going through a "resurrection." It's a fitting word. Something has to die in order to be resurrected. Although the record industry didn't completely die in the 12 years from Napster to present day, many parts are completely gone (physical retailers), others have been transformed (distribution, marketing, ticketing) and still others have been born (digital distribution, social media).

These facts should give the annual MIDEM conference in Cannes, France an unusually upbeat vibe (unusual in that music industry conferences haven't been too upbeat in recent years). There will undoubtedly be talk of the ongoing fight against piracy and the difficult state of brick-and-mortar retail. But the spotlight will likely be on subscription services, social media, sponsorships, mobile apps and other exciting areas. No longer is faith needed to be optimistic about the record business. All you have to do is look at the numbers.
(New Music Seminar)

MXP4 Launching Two New Games During MIDEM
-- MXP4, creator of social, music-based games, announced the launch of two new games that will be launched during MIDEM. Bopler Tap Tour lets players play live to crowds in cities around the world. The game features songs by David Guetta, LMFAO, Fall Out Boy, Owl City, Tiesto, Robbie Williams, Pet Shop Boys, Justice, Motorhead, Chemical Brothers and others. Bubble Music is an extension of MXP4's Bubble Games.

Social games are fairly new ground for music. With Facebook as a proven platform for gamers and licensing opportunities flourishing, MXP4 is feeling good about the future.

"Confidence in our brand continues to grow as music labels and publishers begin to recognize the monetization potential that is created through the gamification of music and the opportunity to tap into an estimated $5b social game market by 2015 (according to a February 2011 report by Parks Associates)," CEO Albin Serviant said in a statement.
(Press release)

Chilling Effects Posting Takedown Reqests From Twitter
-- Chilling Effects, a website that acts as a clearinghouse for DMCA takedown requests, is posting all takedown requests submitted to Twitter. The notices -- currently numbering 4,410 -- can be found at Chilling Effects makes publicly available takedown requests from copyright owners issues to digital service providers. The DMCA allows copyright holders to request that digital service providers remove infringing content that has been uploaded by one of their uses. In turn, some of those digital service providers (such as Google's YouTube and Blogger) forward copies of the takedown requests to Chilling Effects.

A quick scan of the takedown notices shows some copyright owners are requesting that specific tweets be removed because they link to a website that illegally hosts the content. For example, Magnolia Pictures Inc. issued a takedown notice related to a link to illegal downloads of the 2011 film "Hobo with a Shotgun." Universal Music Group did the same for a tweet linking to an illegal download of "sound and video recordings as performed by the artist known as Nicki Minaj." Book publisher Simon & Shuster issued one for a link to an illegal download of the PILMSLEUR Series Language Program.

For a good look at the effort copyright owners are putting forth to deal with copyright infringement, spend some time scrolling though the documents.
(Ars Technica)