Music Price Wars – But What About Ringtones?

Just why are ringtones so expensive? Don’t get me wrong here: I hate them, but there is a huge discrepancy between the cost of downloading a music track and downloading a new ringtone for that phone that’s you’ll probably only own for a month. Often the ringtone will cost more than the entire original song it is based upon.

Consultancy firm Informa have published a report on the state of the ringtone market, and it looks like it’s all the music companies’ fault.

A ringtone based on a sample from a track can set you back up to four times the cost of downloading the whole song from iTunes – the cost is inflated because record labels require royalties of between 25 and 55% of the cost of the ringtone.

For example a track off iTunes will cost you about €1.50 (US$1.82 – nearly twice as much as the US store. I’m sure that’s justified) when the site appears suddenly next month, yet downloading a ringtone can cost a staggering €6 (US$7.30). And thank you T-Mobile UK, for that confident pricing. How much pocket money do kids get paid these days anyway?

“The reseller is really between a rock and a hard place,” said Simon Dyson, a co-author of the report. “They are torn between raising the price or keeping it steady in the hopes of establishing a market. Demanding such high percentage rates by the record companies could certainly lead to the market being depressed.”

Depressed? That’s nothing compared to what will happen when phones are released that can just play an MP3 file as the ringtone – then commuter-bothering phone owners won’t have to buy anything at all. Then the US$3 billion (€3.6 billion) market will vanish over night – instead of growing to the US$5 billion (€8.5 billion) monster it’s expected to be by 2007.

Incidentally, I know some pandas who have a really good ringtone album out.

Informa Media Group

Iliad Translated into Microsoft Messenger. End of Civilisation Obviously Nigh.

Head to the escape pods, the end is near, friends.

The Iliad, the epic poem that for 2700 years has been our best dramatisation of the Trojan War, has been translated into Windows Messenger.

The poem’s 15,693 lines of achingly beautiful hexameter are now condensed in to 363 words and some smileys. All this for the 21st century “instant messaging generation”, and as part of a promotion for Microsoft’s chat application.

However, I imagine there were a few people like me in the 15th century who declared the the end of civilisation when the first printed edition appeared in 1488.

“The new ‘TrIM Troy’, a Messenger translation of the first five books of the 24 book classic tome, has been designed to give MSN Messenger’s eight million users a whistle stop tour of Homer’s world, the motives behind Menelaus’ rage, the bravery of the Greek army, the tragic death of Hector and the fall of Troy in their online lingo”, says the press release.

The upshot of this shallow and purely marketing-led butchery is best seen in its effect on the chilling opening verse:
Rage —
Goddess, sing the rage of Peleus’ son Achilles,
murderous, doomed, that cost the Achaeans countless losses,
hurling down to the House of Death so many sturdy souls,
great fighters’ souls, but made their bodies carrion,
feasts for the dogs and birds,
and the will of Zeus was moving towards its end.
Begin, Muse, when the two first broke and clashed,
Agamemnon lord of mean and brilliant Achilles.
Somehow, this now becomes:

“Ur right to still be ngry, Anchilles has m’ssed things up 4 da Grks wiv his rage”

I would class this as a lossy compression scheme, without any doubt.

Robert Fagel’s astonishing 1996 translation, available from Penguin

Clear Channel Entertainment Acquires Restrictive Patent on Live Concert CDs

Clear Channel has purchased a patent relating to the recording then sale of a CDs at a live performance – and are claiming that it relates to every venue in the US.

Clear Channel operate a service in their venues called Instant Live, where fans can pre-order a recording before a gig and then pick it up at the venue. Clear Channel purchased the patent for this from DiscLive, who have a similar set up. Now Clear Channel are asserting that the patent doesn’t just cover their 130 venues, but all venues in the US.

This all might have something to do with the fact that DiscLive recently predicted it would gross about US$500,000 (€412,600) selling live recordings at gigs this spring.

Clear Channel, (somehow recently nominated by the Fortune 500 as one of America’s Most Admired Companies) have granted US$1 licenses to small bands using the DiscLive service, but are telling everyone else that they can’t sell live CDs at gigs. Apparently, the patent doesn’t apply to bands who sell their disks days after the performance, only when the recording is sold immediately afterwards.

Steve Simon, Clear Channel executive vice president and the director of Instant Live told the Rolling Stone without a hint of irony: /2We want to be artist-friendly. But it is a business, and it’s not going to be ‘we have the patent, now everybody can use it for free.'”

Expect test cases to begin soon.

The Rolling Stone covers the story

BBC Creative Archive licensing to be based on Creative Commons

In a significant step forward towards the opening of a portion of the BBC’s archives, the BBC today made their intentions for the Creative Archives clearer to other UK broadcasters and public sector organisations. The Creative Archive,  originally announced by Greg Dyke in 2003, plans to offer the British public free access to some of the BBC’s audio and video programming.

This afternoon the first meeting of an external consultative panel, which included many UK media holders, heard the BBC’s decision that it will base the Creative Archive usage licence on the Creative Commons (CC) model. This confirmation follows some speculation on the subject. The CC model turns copyright on its head by explaining the ways that the content can be used rather than saying it cannot – or Some Rights Reserved as they put it. By happy coincidence, Creative Commons 2.0 was released yesterday.

By applying a CC-type license to the content, the BBC will enable individuals in the UK to download released content to their computers, share it, edit it and create new content. Commercial reuse of the content will not be allowed.

Professor Lawrence Lessig, chair of the Creative Commons project was clearly excited: “The announcement by the BBC of its intent to develop a Creative Archive has been the single most important event in getting people to understand the potential for digital creativity, and to see how such potential actually supports artists and artistic creativity.” He went to enthuse “If the vision proves a reality, Britain will become a centre for digital creativity, and will drive the many markets – in broadband deployment and technology – that digital creativity will support.”

Lessig has been invited by the BBC to be a permanent member of external consultative panel, which is wise because he is clearly at the centre of Creative Commons and politically wise in the BBC becoming closely associated with the whole movement. This announcement will also be a huge boost in profile for Creative Commons.

Paul Gerhardt, Joint Director, BBC Creative Archive explains: “We want to work in partnership with other broadcasters and public sector organisations to create a public and legal domain of audio visual material for the benefit of everyone in the UK.” Those attending today’s meeting included Channel 4; the British Film Institute; the British Library; ITN; JISC; The National Archives; the Natural History Museum; the Museums, Libraries & Archives Council; senior figures from the independent production industry; BBC Worldwide. The BBC plans to keep those attending abreast of the project, while encouraging them to follow the same route to opening their own archives.

This news will give further hope to those who feel the BBC is a leading light in the usage and availability of content in a Digital Lifestyles world. Gerhardt added “We hope the BBC Creative Archive can establish a model for others to follow, providing material for the new generation of digital creatives and stimulating the growth of the creative culture in the UK.”

Read our interview with Paula Le Dieu, Joint Director on the Creative Archive.

Creative Commons

Oxfam Launches pan-European Music Service Today

Oxfam have launch their own OD2-backed music service, Big Noise Music, on 26th May. Instead of scratched vinyl records of ELO’s Out of the Blue, the charity hopes to lure customers with 300,000 pristine tracks. How they’re going to recreate the musty charity shop smell and the insane elderly volunteer staff is anyone’s guess.

Tracks cost the usual UK£0.75 to UK£0.99 (€1.12 to €1.48), with UK£0.10 (€0.15) from each going to Oxfam’s good causes. The site is pan-Europe, but the genius move is that all the prices are in Sterling.

Adrian Lovett, Oxfam’s Director of Campaigns and Communications said in a statement, “Bignoisemusic.com works for everyone. Music lovers get great tracks and artists see their music helping some of the poorest people in the world, through real cash support and by building the worldwide movement to Make Trade Fair.”

The site has received plenty of endorsements from stars, featuring exclusive tracks from George Michael and Coldplay.

Big Noise Music

Microsoft’s Crack at Federated Identity

Microsoft will be showing off their new federated identity software shortly – a service that will allow users to log in and then carry their identity from site to site, securely allowing businesses to extend applications and intranets to external clients. The technology won’t be available until Q3 2005 with the release of Windows Server 2003 R2.

Michael Stephenson, lead program manager for Windows Server 2003 said “Federated identity lets companies securely extend their applications to suppliers and external users… We are showing how a user at one site might log on to a portal and then they can enter a purchase order at another location without having to sign on again. Today it is very expensive to provide this type of functionality.”

MS’s previous attempt at federated identity, Passport, never quite realised its potential, and so it’s back to the drawing board.

There’s already a W3C standard for federated identity, but Microsoft, along with IBM, want to push the WS-Security specifications put forward by OASIS (Organisation for the Advancement of Structured Information Standards).

Microsoft’s system will also be up against the Liberty Alliance set of open standards, led by their best pals Sun.

Federated identity is of importance to everyone – not only do you need to know what information is being held about you in your “ID passport” and what site and application owners do with that information, but that your personal details are secure and cannot be compromised.

Liberty Alliance

Microsoft and IBM’s original white paper

RIAA Sues Yet More People

As part of its programme to deter the public from sharing music, the Recording Industry Association of America (RIAA) has just launched legal action against another 493 people.

The RIAA has already settled 486 cases, for and average US$3000 (€2486) each. That represents an income of about US$1,458,000 (€1.2 million) – not a bad return, really.

These new actions are “John Doe” cases as the RIAA doesn’t know who they are prosecuting – their identities will be revealed when the courts issue subpoenas.

However, it doesn’t seem that the RIAA’s action against users of P2P applications like Kazaa and Overnet is having much success. Although the RIAA has now sued 2,947 people peer-to-peer client usage is increasing. Research firm BigChampagne claim that 9.5 million people were logged in to P2P networks in April this year, up from 7.4 million concurrent users six months previously.

What’s wrong with the music industry in one long sentence – Thanks to Simon for sending me this link

Google Names 31 Underwriters For IPO

Google has named another 29 underwriters for its forthcoming IPO – these are in addition to the two lead underwriters Morgan Stanley and Credit Suisse First Boston. Amongst the new crop are JP Morgan Chase, Lehman Brothers and Deutsche Bank.

The sale is expected to raise US$2.7 billion (€2.26 billion) later this year, the biggest new technology stock sale since the wheels fell off the new economy in 2000.

Google’s sale will be unusual in that they are going to use a open auction process – investors will be able to bid for shares at a price they are willing to pay, a method that Google believes will be fairer to small investors. Since whoever pays the most still wins, that remains to be seen.

The Unofficial Google IPO Site

IDC: Mobile Applications for Consumers is Where the Money Is

IDC’s new study “Western European Consumer Mobile Data Applications” analyses opportunities for consumer mobile data applications in the market – and I can’t say that we were very surprised by any of the findings. IDC believe that the current state of the market is a good reflection of what to expect in the future: mobile operators will be making cash out of selling small applications, ringtones and other widgets to phone owners, in a market worth an estimated €6.67 billion (US$8 billion).

“This underlines that the wireless industry will not see the one killer application that many are still seeking and talking about,” said Paolo Pescatore, senior analyst for IDC’s European Wireless and Mobile Communications Service. “It is very much a cocktail and these applications will drive usage over GPRS, EDGE, UMTS, and HSDPA. All these applications – ring tones, gaming, video, and music – will eventually find their place on a mobile.”

IDC rightly report that demand for video is not very high, currently – and is certainly dwarfed by consumer interest in games, ringtones and SMS “texting”. As video is not very satisfying on phones at the moment, the industry must be careful not to over-hype the service or mislead consumers into thinking that they will be watching TV quality visuals on their mobile any time soon.

Operators will need to offer engaging content, the report says, and that means that they’re going to have to spend considerable amounts of money and resources securing the rights for that material, whilst partnering up with content houses.

IDC express surprise at the lack of music services for mobile users, and believe that people’s interest in music, coupled with mobility, presents a compelling reason to offer music services. IDC believe it will just take a bit longer, with operators rolling out services towards the end of the year.

The IDC study

Gates Says Blogs Are Good For Business

Blogging is entering the mainstream – Bill Gates thinks they’re a useful business tool, so expect one of your directors to pop up with the idea of corporate blogs at your next board meeting.

Blogs are online diaries, usually collections of links, thoughts and illustrations kept by one person who wants to share information about themselves or their enthusiasms. They can be purely personal, or a day-to-day update on a business project.

Gates says that blogs are a good way to share information, both inside and outside of organisations and have considerable advantages over older forms of communication such as email (email is old now?). Emails can miss out the right people or be too imposing, and websites are too passive. People forget to visit websites, and get frustrated when they make the effort to go there and the site hasn’t been updated.

The solution? A blog with an RSS feed. Real Simple Syndication is a feed that allows stories to be pushed to other sources like news readers and even other websites. This way, changes and new information come to the reader, not the other way round.

Over 700 MS employees keep project blogs, to share information and keep others up to date on projects they are working on.

Microsoft doesn’t have a blogging tool yet – but it can’t be long before one appears, tied in with MSN, Messenger and quite possibly FrontPage and MS Project.

Blogging Platforms

Blogger

Movabletype

Blogs

GoogleBlog

Simon Perry