U.K. download store 7digital is targeting sizeable global expansion in 2012, beginning with the launch of a Windows Phone app.
The London-based music service has partnered with Microsoft to launch its mobile service on the new range of Windows Phone devices, including the Nokia Lumia series. The first handsets to carry the 7digital Windows Phone app will be available early 2012, Ben Drury, 7digital CEO and co-founder, told guests at a press conference held at Shoreditch House, London. The company is to expand its North American operations with immediate effect.
7digital, which was started in 2004, boasts a catalog of 17 million music tracks and is currently available in over 35 markets, including the U.S., Europe and Asia.
Vickie Nauman, it was announced, will take on the newly created role of president of 7digital North America, having previously served as 7digital VP since 2009 when the company acquired its first U.S. and Canadian music licenses. Nauman will be based in Los Angeles where she will oversee business development, label relations and marketing, as well as targeting new strategic partners. 7digital already has deals in place with T-Mobile USA, RIM, Samsung, Songbird, AOL's Winamp, and Fantrail and is looking to open an office in San Francisco early next year from where to spearhead its U.S. push.
"The U.S. is such a big market and you can't necessarily go and build a brand just like that, but we see lots of opportunities," Drury tells Billboard.biz. "There's no strong competition doing exactly what we do [in terms of] our partner approach, so we'll continue what we're already doing; working with start-ups, working with consumer electronic [companies] and working with big tech companies and helping them with digital content."
Drury says that North American expansion follows significant growth in international revenue in 2011, crediting partnerships with the likes of Samsung, RIM and T-Mobile USA with helping it break into the world's biggest music market. "It's been a phenomenal year," he says. "We've gone from probably hundreds of thousands of dollars of revenue to multiple million dollars of revenue from the U.S. and Canada."
In addition to opening offices in Los Angeles and San Francisco, the company is looking to establish an East Coast base, although all tech and platform operations will continue to be run from 7digtal's London base, which has a 70-strong staff.
The past year has seen 7digital's range of music services - which includes the provision of digital media platforms to hundreds of international partners, including HMV, RIM, Pure and Samsung, alongside its own download store (www.7digital.com) - launch in Singapore, Australia and New Zealand.
7digital's mobile offering is currently available on Samsung Galaxy phones and tablets, Blackberry devices and all Android handsets. Drury says that the company recently crossed the three-million customer mark and grew its customer base by 100,000 users in November. Significantly, 44% of the company's sales now come through mobile devices, compared to 1% last year.
"We're really ramping up our growth and we've got to continue that momentum and we want to launch in more territories," says Drury, identifying Latin America as market where 7digital is seeing strong demand. "We'd like to grow next year by at the least the same amount as we've grown this year," he continues, while declining to reveal exact figures.
Prior to announcing 7digital's partnership with Microsoft, Drury delivered a presentation on the wider digital market and its continued growth. "For me, 2011 has been the year that digital music has come of age," he told invited guests and media.
"iTunes has been dominant in the legal music space for the last 5 or 6 years with 80% plus market share, but I think we're really entering a new age now where we've got real diversity and real competition coming through," he went on to say, before expressing the belief that "iTunes has peaked."
"We believe that their market share has always been tied to the iPod market share," Drury continued. "Now that people are consuming and acquiring music on more and more devices, phones and tablets this is leading to some Apple market share decrease. This doesn't mean that Apple is out of the way. They are going to be number 1 for a long time, but I think it's helping consumers, it's helping record labels, it's helping everyone that [Apple's] market share is going down."