Business Matters: Inside eMusic's Lack of Subscriber Growth
Business Matters: Inside eMusic's Lack of Subscriber Growth

eMusic added to its catalog over 15,000 EMI albums Thursday, making it the last of the four majors to join the subscription download store. Only U.S.-based eMusic customers will be able to buy EMI titles.

"There is a huge sense of momentum here at eMusic," CEO Adam Klein told Billboard. The addition of EMI comes as eMusic has made improvements to the site, switched from a credit to currency-based pricing structure and put greater emphasis on its editorial content. Customer churn is down 14% year-over-year and average revenue per customer is up 22% in the last six months, he says.

Klein insisted there was no specific reason why EMI was the last major to sign up with the service. "In fairness to them, they've been going through a lot of changes in recent months. We're just delighted they're up now."

EMI's catalog includes Blue Note, which will add many classic jazz titles to eMusic, and a wide range of other genres. Many rock and pop artists - including the Beach Boys, David Bowie and Blondie - should sell well. The Beatles catalog will not be available, but eMusic will have some of the band members' solo albums, Klein said. EMI's Pink Floyd catalog will be added in June.

Initially, only EMI albums 12 months or older will be sold by EMI at eMusic. Over the next few months, eMusic will be able to put up a "limited number" of frontline titles. Other majors sell select new releases at the store. For example, Adele's "21" (Sony), TV on the Radio's "Nine Types of Light" (Universal) and Foo Fighters' "Wasting Light" (Sony) are currently in eMusic's top 10.

Major labels have fared well at the download store, which was once dominated by indie music. On Wednesday, eight of the top 10 and 15 of the top 20 labels at eMusic were majors. One major label source tells Billboard eMusic appears to be one of many factors behind this year's strong catalog album sales. Klein points to eMusic's recent "Essentials" promotion that resulted in 10,000 album sales in six weeks. "Most of that was incremental revenue," he says.

So what's next for eMusic now that it has EMI's catalog? For starters, the company is finalizing plans with labels to allow its customers to enjoy full-song previews instead of the current 30-second previews. The company plans to improve the way its customers share information amongst themselves. And there will be other improvements to the site. "Over the summer you will see some wonderful enhancements, both for existing members and how we go about acquiring new members," says Klein.