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Time To Create, Time To Lead
March 31, 2006
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"Innovation distinguishes between a leader and a follower."
-- Steve Jobs, CEO Apple Computers & CEO Pixar Animation StudiosWhile Apple celebrated its thirty year anniversary this past week ( read the whole Apple story by clicking here: Click here, rumors that SONY/BMG was for sale continued to circulate, rumors that the famed Capitol Tower in Hollywood was for sale and might be sold to a developer who wanted to turn in into condominiums (!) were all over tinsel city, and New York attorney general Eliot Spitzer was at it again. This time Mr. Spitzer is targeting a group of giveaway websites called Gratis Internet, which includes FreeiPods.com for improperly gathering e-mails collected by the company. ( Am I the only one who wonders why Mr. Spitzer isn't spending more time rounding up some REAL criminals? This guy certainly has a lot of free time on his hands. )
In the meantime, the news and predictions about online music sales continues to tell the same story: big growth online and further declines in CD sales. This week Forrester Research released a report that stated by 2011, European online music sales will account for one third of overall sales at $4.7 billion. While that's a positive, they also predict by that time CD sales will have fallen 30%. So basically, the growth online will pick-up (hopefully) the percentages lost in physical sales. Forrester also predicts that total European music sales will grow from $11.41 billion this year to $13.21 billion in 2011 and online sales for 2006 are projected at $335.2 million.
The news story I've included below ( ' Online Music, Music, Music' ) reports that " The Internet is now a key distribution channel for legitimate digital music sales; and, in 2005, online sales of digital music represented almost 5% of the total worldwide music market.
Indeed, the Internet presents new distribution opportunities. But yet another report this week by Mintel (a worldwide leader of competitive media and consumer intelligence) titled ' Retail Music Industry Battles Extinction ' (Click here) talks about a variety of other problems facing the brick-and-mortar retail business.
"The growing distance between the music industry and its consumer is due to a number of factors," said Justin De Santis, analyst for Mintel. "These include lawsuits against individual consumers, payola practices, and, most recently, restrictive use of digital rights management."
The article also touches upon a lack of artists developed that have "staying power" (the loss of artist development as discussed in this newsletter for three years) and states " big labels have relied on obsolete strategies for over a decade and have been late in exploiting emerging technologies. As a result, the bond between independent artists and their fans have become stronger. Although the music industry is just starting to use digital distribution to its advantage, overall sales will continue to decline unless companies learn to adapt more quickly to changing technologies."
There will most likely be some new physical format of music and audio developed in the future (most likely newer disc technology ala Blu-Ray, or chips down the road), and music retailers can play a big part in introducing it to their consumers. There's absolutely no reason why innovation in the industry can't create a myriad of new prospects that will make for a better, more secure future for all.
But innovation needs to be implemented long before results can be achieved and time waits for no one.
Online Music, Music, Music
Stephanie Guza, Industry Analyst, summarizing In-Stat's most recent online music report, says that the Internet is now a key distribution channel for legitimate digital music sales, and the mobile phone is also evolving into an important channel for digital music.
Guza says that " ... consumers are clearly opting for legal ways to purchase music, more legitimate music sites are available, and increasing broadband access is enabling online music distribution like never before. Despite this progress, vendors in the market still face significant obstacles. Internet piracy, interoperability concerns, and the unlicensed use of digital streams represent real challenges to the growth of this market."
Read more about it by clicking here.
Survey: iTunes, Others To Pick Up Slack In Music Sales
Online music sales will grow rapidly over the next five years, though traditional music sales will still make up almost two thirds of revenues in 2011, according to a survey released Monday by market researcher Forrester.
The study forecast a 30 percent decline in European sales of traditional music formats like CDs and DVDs, but music downloads on the Web from shops like iTunes Music Store from Apple Computer will fill the gap. Online sales are seen growing more than tenfold to 3.9 billion euros ($4.70 billion) in 2011 from 279 million euros ($335.17 million) in 2006. The total music sales market will grow to nearly 11 billion euros ($13.21 billion) by 2011, up from less than 9.5 billion euros ($11.41 billion) now, as the new sales channels will boost demand.
Read more about it by clicking here.
Apple Packages Videos For Next iPod Push
Apple Computer is exploring new ways to market and sell music videos in bulk as interest in downloadable video grows. In a first, iTunes is selling all the clips from Tori Amos' "Fade to Red"--a 21-song music video collection released on DVD via Rhino Entertainment--as individual downloads for $1.99 each or as a complete package for $24.99.
The iTunes Music Store has been steadily selling one-off music videos of current and catalog hits for $1.99 apiece since late last year. But the company is just now moving into higher-margin packages.
Read more about it by clicking here.
Sprint Eyes Music Subscriptions
Sprint Nextel hopes to boost its mobile music business this year by offering a new subscription plan for downloading songs onto cell phones and by expanding its partnership with Sirius Satellite Radio, a top executive said Tuesday. As the price of making cell calls declines, U.S. wireless carriers are adding music and video download services, aiming to boost revenue by convincing customers to use their cell phones for more than just talking.
Sprint, the No. 3 U.S. wireless service, was the first U.S. operator to start a wireless music download service in October. Advanced services such as music, text messaging, games and video represent about 10 percent of Sprint's revenue.
Read more about it by clicking here.
YouTube: The Talk of Tinseltown
SANTA MONICA, Calif.--More than just teenagers and 20-somethings have begun flocking to YouTube, the fast-growing video-sharing site. The 13-month-old company has begun winning fans from within some of the country's largest media outfits.
Executives from heavyweights such as Yahoo, America Online and Turner Broadcasting were buzzing about YouTube's sudden success at the Digital Hollywood conference here this week. Even though it's not clear exactly how YouTube will make money, no company generated as much excitement at the gathering of Hollywood studios, electronics manufacturers and Internet media companies.
Read more about it by clicking here.
Sinclair Broadcast Group And The TUBE Music Network Announce Agreement To Launch The TUBE Into 28 New Markets
24-Hour Music Channel Available In 71 Of The Top 100 Markets By Summer.
Miami, March 23, 2006 -- Les Garland, CEO, The Tube Music Network, announced a distribution agreement today with Sinclair Broadcast Group (NASDAQ:SBGI). Sinclair owns and operates, programs or provides sales services to 58 television stations in 36 markets, including Pittsburgh, St. Louis, Minneapolis, Tampa, Las Vegas, Baltimore, Nashville, Columbus, Cincinnati and Syracuse.
Revealed just two weeks after a similar agreement with Tribune Broadcasting was announced, THE TUBE Music Network has quickly established itself as a major force in the burgeoning digital broadcast era.
"Sinclair Broadcast Group's broad reach enables us to penetrate pivotal markets, lending significant depth to our audience. Already comprised of viewers on 13 prestigious stations in Raycom Media markets, and soon 9 of the top 10 Designated Market Areas through Tribune stations, THE TUBE Music Network will be available in virtually every major U.S. city," said Garland.
"We have officially realized one of the very first applications of the new digital technology, and more importantly, are using it to deliver truly innovative content to consumers starved for intelligent programming," said Garland, co-founder of MTV, VH-1 and The Box.
"THE TUBE is another example of how broadcasters are utilizing their digital channel capacity to launch competitive programs to monetize their digital investment," commented David Smith, Sinclair President and CEO. "In the case of THE TUBE, they also provide a unique twist to the already successful television music formats through the interaction of television and the Internet."
THE TUBE is the first music network to be distributed using a new broadcast technology known as digital multicasting. Viewers in Sinclair, Tribune, Raycom and other television markets will be able to receive the network free, over-the-air on television sets equipped with digital tuners and on the digital cable tier where available.
THE TUBE Music Network is a pure, music network that features a bold fusion of the best artists, the best songs and the best images of all time. The playlist reflects the music of some of the biggest touring acts in America today, including The Rolling Stones, U2, Paul McCartney, The Eagles, Elton John, Prince and Rod Stewart; mixed with classic artists such as Led Zeppelin and Tom Petty; and newer artists such as Norah Jones, Coldplay, Jack Johnson, James Blunt, Alicia Keys, KT Tunstall and John Mayer. There are no reality shows, award shows or game shows on THE TUBE and the viewer response to this new format has been overwhelmingly enthusiastic.
Further differentiating THE TUBE Music Network will be the ability for viewers to purchase the music they see and hear on THE TUBE immediately, whether online or on the phone.
Sinclair stations will begin broadcasting THE TUBE Music Network programming in local markets this summer.
THE TUBE Music Network is a wholly owned subsidiary of THE TUBE MEDIA CORPORATION (OTC: TUBM).
MORE DEATH ROW TROUBLES
A judge ordering Suge Knight to appear at a hearing to discuss his assets next month, or risk having Death Row Records seized by the court.
IDOL FANS COMPLAIN
American Idol fans took to message boards last week to accuse contestant Chris Daughtry of copying his version of "I Walk the Line" from the band Live. "This guy is a rip off. Judges are plain dumb," one fan wrote. In the meantime, Paula Abdul signing a contract extension that will keep her judging American Idol contestants for at least three more years.
PASSING
Country singer Buck Owens, who crooned more than 20 number-one hits, including Act Naturally, died Saturday in Bakersfield, California; he was 76. Owens also hosted TV's long-running hit, Hee Haw, a mix of comedy, music, and girls, in the pre-Daisy Dukes era.
INVESTING?
David Bowie and Sting reportedly in talks to open a branch of burlesque club Forty Deuce in Manhattan, per Britain's Daily Mail.
SWITCHEROO
Jessica Simpson will leave Columbia Records, where she's been signed for six years, in favor of Epic Records, where she will release her upcoming album. Both labels are owned by Sony.
GET IN LINE EARLY
America's Got Talent, a new NBC reality show from Simon Cowell and the producers of American Idol, kicking off a multiple city casting search for the most talented person in America April 6 in Los Angeles. Auditions will also take place in Chicago, New York and Atlanta. The winner gets a paid gig in Las Vegas.
DESTINY
Destiny's Child receiving the 2,305th star on the Hollywood Walk of Fame Tuesday, coinciding with the release of the former girl group's live-concert DVD, Destiny's Child: Live in Atlanta.
CONGRATS
Crosby, Stills & Nash being honored as BMI Icons at the 54th Annual Pop Awards May 16.
ELVIS' CRIB NOW A NATIONAL TREASURE
Graceland, home of Elvis Presley, reaching the status of the homes of presidents past and present after being designated a National Historic Landmark Monday.
THIS SHOULD BE INTERESTING
Oscar winners Three 6 Mafia set to record and produce tracks for Paris Hilton's upcoming debut album.
RHYMIN' SIMON COMING BACK
Paul Simon set to release his first album in six years, Surprise, on May 9.
PARTNERS
NBC and rival Disney-ABC's Touchstone Television teaming up to make the peacock's hit Scrubs available for downloads for iTunes, marking the first time a network and a competing media company have formed a partnership to do so.
COMING SOON!
- Morrissey, Ringleader of the Tormentors (4/4)
- Drive By Truckers, A Blessing and a Curse (4/11)
- Godsmack, IV (4/25)
- Tool, 10,000 Days (5/2)
- Pearl Jam, Pearl Jam (5/2)
2006 Industry Conferences
Date Name Location MusExpo 2006 April 30-May 3, 2006 Los Angeles, CA Streaming Media East 2006 May 23-24, 2006 New York, NY Home Entertainment 2006 June 1-4, 2006 Los Angeles, CA
Quotes of the week
" Under no circumstances would I ever have anyone fired for having breasts that were too large. "
-- Bill Joel, responding to accusations from a dancer in his hit Broadway production 'Movin' Out' that she was fired for just that reason." I was performing in Boston, and my opening joke was about Ray Charles. No one told me that a school for the blind was in the front three rows."
-- Steve Harvey in People, on his most embarrassing moment." The cover story of this week's "Time" magazine is about global warming. It's pretty frightening story. They say if current warming trends continue, by the year 2015, Hillary Clinton may actually thaw out. "
-- Jay Leno
NARIP Information
NARIP (The National Association of Record Industry Professionals) promotes career advancement, education and good will among record executives. To find out more about this great organization, how you can join or attend their events, just go to: www.narip.com.
The B-Side - 'Blips'
A frustrated husband is trying to prove his point to his wife by going on strike, Detroit television station WDIV reported. James Wilson of Redford, Mich., has been spending his days on the roof of his home because he says he wants his wife, Valentina, to keep their 3-month-old daughter and 2-year-old son out of the bedroom at night. Wilson said the children in the bedroom are causing an intimacy issue, but Valentina said the kids will remain in the room, WDIV reported. Both Wilsons said they have a very happy marriage, but this is a problem.
"I want my bedroom back and the diapers and toys removed immediately," said James Wilson. Wilson has been visiting his Web site, where he is reading comments from people who he said agree with him.
For more information, go to www.HusbandOnStrike.com.
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