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Business News Week In Five
The music business week in five – 17 Jun 2011
By Chris Cooke | Published on Friday 17 June 2011
So, first my plug of the week, our next CMU Training course on 29 Jun looks at the business models, artist deals and revenue streams that will drive the music industry in the future, so assuming you’re planning on being here in the future, you should come along! You can book your place right now at www.completemusicupdate.com/training/.
Second, useless fact of the week. And Extreme Tech reckons that Google’s recent Les Paul tributing ‘play me’ guitar-like Google Doodle cost the world £166 million in lost office-hours from the time the working population wasted playing with the nifty little digital toy. Still, time better spent, surely, than thinking of and then tweeting the name of the film that best describes your penis.
Third, my link of the week. Yes, even the Muppets are now mocking Bono, The Edge and the producers of the ill-fated ‘Spider-Man’ Broadway musical, which finally opened this week after a record breaking 180 preview performances. See the Muppets sketch here.
And finally, here it is, the five biggest news stories from the music business this week.
01: Pandora floated, one of the first digital firms to capitalise on growing City-boy interest in all things internet. 14.7 million shares were sold at $16 a piece. Given those shares amounted to just 9% of the company, that values Pandora at $2.56 billion, although that share price is already slipping. Although popular with its users, and one of the only digital music services to have lasted the distance, Pandora is yet to make a profit. CMU report | Bloomberg update
02: Spotify USA edged closer. It was widely reported this week that Universal Music had signed up to Spotify in the US, and that even hold outs Warner were not close to signing up, possibly because the popular streaming service has scaled back on its freemium service. A spokesman for Spotify indicated a summer launch Stateside was now likely, but it wouldn’t be this month. Team Spot have been promising an American launch for some time, but the US divisions of the major labels were initially hesitant about licensing it. CMU report | Billboard report
03: Report suggested a streamlining of BBC pop station management structures. Former commercial radio man John Myers had reviewed the operations of Radio 1, 2, 1Xtra and 6 and said that while they were all great stations, there was much scope for making cost savings without affecting output. In particular, he recommended having one controller and management team for all the Beeb’s pop stations, rather that one set of management for 1 and 1Xtra and another for 2 and 6music. He also said all the stations’ news operations should be merged. BBC Radio chief Tim Davie welcomed the report, though didn’t seem that keen to pursue many of its proposals. CMU report | Guardian report
04: LA Reid was linked to an Epic US role. The former Island Def Jam chief has been expected to follow his former boss Doug Morris to Sony Music ever since he announced his departure from the Universal division, especially as he is a judge on the Sony-owned ‘X-Factor USA’ TV show. The Hollywood Reporter has said Reid will head up a newly expanded Epic label division, which would also include the old Jive labels, including the one he co-founded in 1989, LaFace. CMU report | Hollywood Reporter report
05: PricewaterhouseCoopers was upbeat about the entertainment sector, but less so music. The accountants issued their annual report on the media and entertainment industries, and said they were seeing more growth than expected. So much so they predicted the wider sector would grow by 5.7% year on year over the next five years. Though they excluded the music business from this, which they said would start to grow again within the next five years, though not immediately, and more modestly. CMU report | New York Times report
And that’s your lot – don’t forget to look out for a new podcast with more week-in-view type shenanigans later today: www.completemusicupdate.com/podcast/
Chris Cooke
Business Editor, CMU
