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My Space Not The Place It Once Was, A Lesson For All Online Companies
October 23, 2009
Have an opinion? Add your comment below. 24 years working in executive promotion capacities at both Capitol Records and at Universal Studios' MCA Records. Recognized as one of the industry's top professionals.
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"I think that what you see in the space more than anything else is if you don't keep innovating and moving forward, you get in trouble. You can't stop, you have to keep going, and (MySpace) didn't keep going; it kind of stopped."
-- MySpace CEO Owen Van Natta at the Web 2.0 Summit this weekLast week I put a link in to a news story from MediaPost titled "Facebook Soars, MySpace Shrinks and Twitter Slows" ( http://tinyurl.com/ykmnbo3 )
This week, MySpace CEO Owen Van Natta admitted as much (see news story below "MySpace Amps Up Music Offerings, Chief Exec Says Its Dead As A Social Network") and the quote from him above, basically sums up not only what happened to MySpace in the social network arena, but what can happen to any online entity that does not develop and create enough to sustain user retention, loyalty and growth.
Van Natta unveiled plans for the future of MySpace, and those plans involve focusing on "a new music video hub as well as an enhanced set of marketing tools for music artists -- some of which were built in with technology from iLike, which MySpace acquired this summer." (Source: http://tinyurl.com/yzjam5d )
"MySpace started with an essence around certain things, and one of them was music, and meeting new people," said MySpace chief digital officer Jonathan Miller, a former AOL exec who also joined News Corp. this spring. "We're going back to basics in that sense, but you've got to make it relevant to today and going forward."
Making it relevant is indeed the key. While Van Natta adds that "we had two fantastic competitors emerge in Facebook and Twitter," he would do well to realize that both of those entities, despite their current success, can also tumble as quickly as MySpace did, if they don't innovate at light speed. While Facebook is adding new applications to not only retain its huge user base, but to grow against the competition, Twitter will likely find it somewhat more challenging. How do you innovate users coming to post 130 character "tweets"? And with the churn rate on Twitter, what's their future plan?
Those questions, and others, are what must be addressed by all online companies that hope to not only claim their space, but make that space profitable.
One of Steve Jobs' most famous quotes, which I've used many times in the newsletter, is this one: "Innovation distinguishes between a leader and a follower."
It's obvious that Apple is the worldwide leader with the iTunes music store, and it's because they are constantly upgrading and innovating the site, to ensure the users -- those people buying music -- have the best online experience possible. That same thought, vision and care must be applied daily at all online properties. Technology moves at light speed, and what's considered "hot" today can cool faster than David Letterman's wife did after the news broke about David's affairs with young staff interns.
MySpace was once the dominant social networking website with an estimated value in 2006 of $6 billion, or 10 times the original $580 million News Corp. paid for it (Source: http://tinyurl.com/ygt9p8g )
I have no idea what MySpace might be valued at today, but an article on the Silicon Valley Insider on September 30th titled "A Glance At Internet History Suggests MySpace Is Pretty Much Worthless," said, "How much is a deeply troubled, money-losing social network that has long-since surrendered its buzz and momentum to Facebook worth? There's no definitive answer. A glance at the financials -- shrinking revenue, losses, declining market share, loss of mojo and market leadership -- would suggest that the company might be worth 1X-2X revenue -- on the assumption that MySpace could cut costs radically and make a bit of money in the next few years. That would put the valuation at about $500 million to $1.2 billion -- with the lower end being LESS than Rupert paid for it, and the upper end being twice what he paid for it (hardly the steal of the century)." (Source: http://tinyurl.com/yd6cggx )
Back in November of 2003, I wrote in the newsletter, "There is no such thing as having too many customers and no business is safe from shifting trends and changes in the marketplace today as consumers have more choices than ever where to spend their disposable income. Music companies have relied on mega-selling multi-platinum albums during their fiscal year to continually drive revenues and profits. With a healthy, diverse and deep roster, that formula worked well for labels for quite some time. Enter the Internet, technology to burn CDs, and the era of instant gratification and with it, disposable music, movies and fashion. The public consumed "junk culture" like junk food and moved on to the "next thing" at an ever-increasing speed. "
The public still moves on to the "next thing" at ever increasing speeds and it certainly doesn't look like they are going to change that habit anytime soon.
Maybe MySpace got too comfortable with its huge user base. Maybe they just didn't see how fast Facebook was coming on. Maybe they thought they were so far ahead of the game, that no matter who came up fast they would always be on top. Whatever the case may be, the lesson from what happened to MySpace is one that many others have also learned too late. Remember when AOL ruled the online world and actually bought Time Warner? What a movie that will make someday.
MySpace isn't gone; it's moving in a new direction. They have to survive in any meaningful form.
Facebook should take note. They lead the pack right now, but sooner or later they will look in their rearview mirror and see the hood of the car that has some new powerful engine in it, ready to move into first place.
The race is on. It's always on.
Drivers, don't take your eyes off the road. Not for a second.
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THE 'A-SIDE' - TRACK 2
YET ANOTHER REASON THE TV NETWORKS FACE BIG HURDLES, MORE ONLINE OPTIONS COMING
The Hollywood Reporter reports that Comcast subscribers will be able to watch series such as HBO's "Entourage" on their computers by the end of the year without paying a dime extra. Comcast will be the first cable TV operator to unlock online access to a slate of valuable cable programs. CEO Brian Roberts showed off the new service at the Web 2.0 Summit this week, likening it to "video on demand on steroids."
Access will be carefully guarded: Subscribers can initially watch shows and movies only on their home computers after being verified by Comcast. The online viewing will be restricted to those who also get Internet service through Comcast, not through competitors like phone companies.
Comcast executives say cable networks, such as HBO and AMC, will decide how much to put online. Some will include the current season's episodes only, while others could include archives. The national rollout of the service, initially called "On Demand Online," comes months after Comcast announced partnerships with 24 cable TV networks and broadcasters. Similar plans are in the works at Time Warner Cable, Verizon and DirecTV.
You can read the rest here: http://tinyurl.com/yzy6vo7
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THE 'A-SIDE' - TRACK 3
iPOD SALES NOW AT 225 MILLION
Last month, Apple reported that total iPod sales had now reached 225 million, giving Apple a whopping 73.8% of the digital mobile music player market. While those numbers are indeed represent incredible growth for Apple, one can easily draw a parallel between the enormous success of the iPod and the decline of CD sales year over year.
While CDs still sell in very respectable quantities (witness the recent catalog sales of The Beatles and Michael Jackson to verify that), any artist(s) NOT making their music available online at iTunes, Amazon or elsewhere is obviously missing the boat when it comes to maximizing sales and decreasing theft of their music online. (Whoever is holding up The Beatles catalog is wasting millions every day )
The Internet is all about ubiquity. And any artist who hopes to generate sales of their music should make their music available in as many places as possible. Now.
And Now For Some News ...
MySpace Amps Up Music Offerings, Chief Exec Says Its Dead As A Social Network
Financial Times et al.MySpace chief executive Owen Van Natta tells the Financial Times that the once reigning social network is no longer interested in competing with Facebook. Positioning MySpace solely as an online hub for music and entertainment, Van Natta says, "Facebook is not our competition ... We're very focused on a different space."
Granted, Facebook represented more than 58% of U.S. social network traffic in September, according to Hitwise, while MySpace saw its share slip from 66% a year ago to just 30%. But MySpace is no Friendster (the first popular social net, which, for the record, is big in Japan.) The News. Corp unit remains one of the most-visited sites on the Web with over 100 million unique users worldwide. Of critical importance, MySpace is seen to be winning the critical arena of Web video, according to Nielsen. With 120.8 million video streams, Nielsen reported this summer that MySpace was the top social networking destination when ranked by streams and total minutes spent viewing video. What's more, MySpace Music, a joint venture in which top music labels have an equity stake, has grown 1,000% over the past year, and 200% annually since its launch, according to Van Natta.
So, rather than conceding defeat to Facebook, we suspect that Van Natta's comments represent some strategic jujitsu to pit MySpace's strengths against Facebook's weaknesses. Though Silicon Alley Insider says it doesn't matter what they do. To that end, MySpace this summer acquired popular music recommendation startup iLike -- reportedly for about $20 million -- to bolster its music service and the site's broader infrastructure. Also this summer, Van Natta brought in consultancy firm Media Link -- where Wenda Harris Millard has served as president since April -- to advise MySpace on its ad strategy going forward.
MySpace has struck a deal with Apple's iTunes store to allow its users to buy tracks without having to leave the MySpace site. It has integrated iLike, and launched Dashboard, an interactive tool for bands and musicians, as well as compiling the largest catalogue of music videos on the Web. Van Natta said the applications were a "springboard" for the revamped MySpace and would be followed by other new features in the coming months that tap into the site's large online community.
"There is a movement around the socialisation of the Web," he tells the Financial Times. "People want to experience [what's available on] the Web with other people."
Read more about it by clicking here.
Google's New Tune
Tech Crunch et al.Oh, that Google. Its sweeping ambition never ceases to amaze us. This time, according to various reports, it's building a music service, which the search giant has spent the last month or so bolstering with content from major music labels.
What else is known and not known about the service? It might be named Google Audio, according to TechCrunch (which broke the news). Also, it's nothing like the music download service that Google China launched in 2008, but it's not clear whether it will based on downloads, streams, or both.
According to MediaMemo ( http://tinyurl.com/ylkz8mu ), the service will actually be named, "One Box," will only be offering limited bits of music, and will rely on other companies to actually provide the tunes.
How will it work? Punch in, say, "Jay Z", and you'll be presented with one or more songs, which may be partial clips or full-length versions, then guided to other sites where you can purchase the music.
But, insists MediaMemo, "If you're looking for Google to launch a rival to Apple's iTunes (AAPL), or music streaming services like iMeem and MySpace Music, this isn't it." (In fact, iLike -- the music startup that MySpace purchased earlier this year -- and Lala.com will actually be providing music to Google, industry sources tell MediaMemo.)
But that isn't stopping publications like eWeek from running headlines like, "Google May Launch Music Service to Challenge Apple iTunes," and then leading off their stories with leads like, "Google is set to challenge Apple, Spotify and several players in the digital music space by launching Google Audio."
Read more about it by clicking here.
Facebook Hears Music
SoftepediaIn the wake of news that Google's getting into the music biz and MySpace's stated music strategy, Facebook is announcing that it will start selling music as gifts through its Gift Shop. Notably, it's partnering with Lala to provide the songs -- the same company with which Google is partnering in its own venture.
"You now will be able to purchase songs as gifts for your friends ... The 'Music and MP3s' section of the Gift Shop, powered by LaLa.com, offers over 8 million songs for any music lover from artists such as Beyonce, the Rolling Stones, Frank Sinatra, Imogen Heap and even Wolfgang Amadeus Mozart," says Will Chen, a software engineer at Facebook. "Web songs are 1 credit each, while full, downloadable, and digital rights management-free (DRM) MP3s are 9 credits each."
Read more about it by clicking here.
Judge Rejects Ringtone Lawsuit Against Verizon
A U.S. federal judge has rejected a music royalty collection agency's contention that a mobile operator is liable to pay public performance royalties when a ringtone is played. The suit was filed in U.S. District Court for the Southern District of New York by The American Society of Composers, Authors and Publishers (ASCAP) against Verizon Wireless. ASCAP filed a similar suit against AT&T.
ASCAP's suit marks another attempt by the music industry to secure new revenue in light of the proliferation of digital music. ASCAP argued that Verizon "was directly and secondarily liable for public performances of music works."
Read more about it by clicking here.
Upcoming Net Neutrality Rules Will Change Digital Landscape
By Gavin O'MalleyIf any company was unconcerned about Net Neutrality, it would be Twitter. How much bandwidth does a tweet require? Yet, along with Facebook and Digg, Twitter is getting involved in an issue that, for better or worse, is likely to fundamentally alter the entire digital landscape.
"We believe a process that results in common sense baseline rules is critical to ensuring that the Internet remains a key engine of economic growth, innovation and global competitiveness," the group of 24 CEOs and Internet company founders, including Twitter's Evan Williams, wrote in a letter to be delivered to the FCC Monday in support of the proposed net-neutrality rules.
"An open Internet fuels a competitive and efficient marketplace, where consumers make the ultimate choices about which products succeed and which fail. This allows businesses of all sizes, from the smallest start-up to larger corporations, to compete, yielding maximum economic growth and opportunity," they wrote.
Read more about it by clicking here.
Verizon CEO Slams Net Neutrality
Cnet.comThe day before the FCC is expected to start the ball rolling on new regulations to keep the Internet open, Verizon Communications CEO Ivan Seidenberg painted a doomsday picture of what could happen in the industry if stricter rules are imposed.
Read more about it by clicking here.
Vevo Gets Investment Money
MediaMemoAbu Dhabi Media Company has purchased a stake in Vevo -- the music industry's version of Hulu -- from owners Universal Music and Sony. Terms of the deal were not disclosed, but MediaMemo reports that the joint venture is being valued at $300 million.
Google's YouTube isn't an owner in the JV but will share revenue in exchange for lending Vevo its massive distribution platform. The site, which will exist both outside YouTube and within YouTube as a branded channel with its own player, is scheduled to launch later this year.
Vevo has been seeking an outside money source for some time. PaidContent previously reported the venture was looking for a $300 million valuation. According to MediaMemo, the outside money is designed in large part to allay antitrust issues, given that Vevo's existing owners represent two of the four major music labels.
Read more about it by clicking here.
Apple Shares Soar On Earnings Report
By David Goldman, CNNMoney.com staff writerMac and iPhone sales soar, sending quarterly profit up 47%. Stock hits record high in after-hours trading.
Read more about it by clicking here.
The Performance Tax And Radio
No matter what side you're regarding the Performance Tax the labels want from radio, you should read Jerry Del Colliano's take on the subject.
Jerry talks about the pros and cons of what such a Performance Tax might mean for radio and records.
Read more about it by clicking here.
The Beatles: Rock Band Beats Guitar Hero 5 In September Sales
As album sales soften and the industry turns to alternate ways to get music to fans, the battle between the big music video games has become increasingly heated, and new sales figures indicate The Beatles: Rock Band has a bit of an edge on Guitar Hero 5. According to Billboard , The Beatles: Rock Band sold 595,000 copies following its September 9th release, while GH5 moved 499,000 units since it hit stores on September 1st. In all, both games help fuel a revenue increase of 72% for music video games compared to September 2008.
Read more about it by clicking here.
Rock Band App Hits iTunes
From Appleblog.comAll heck is about the break loose now that EA has debuted its Mobile Rock Band game on the iTunes App Store. No, the iPhone's 320×480 pixel touchscreen isn't exactly reminiscent of a Stratocaster, but that isn't dampening early buzz around the extension. Its long-term success, however, remains in question.
"Without the faux-instruments, Rock Band for iPhone offers an unavoidably watered-down game-play experience," the Appleblog.com writes. "It loses the original feel of Rock Band ... Instead, it becomes a clone of the hugely popular Tap Tap from Tapulous, which was first released in the App Store way back in September 2007." Rock Band for iPhone and iPod touch launches with 20 songs, and will set fans back $9.99.
Read more about it by clicking here.
HERE COMES ABBEY ROAD
As promised, Abbey Road will be available in its entirety for The Beatles: Rock Band starting this week, Harmonix and MTV Games announced in a press release.
IT WAS 40 YEARS AGO
That Led Zeppelin released their multi-platinum "Led Zeppelin II" that created a tidal wave of retail and radio driven by "Whole Lotta' Love."
BRUCE CLOSED IT, BON JOVI WILL RE-OPEN IT
Bruce Springsteen closed down Giants Stadium at the Meadowlands, and another New Jersey boy will re-open it. Bon Jovi announced that they will be the first to play the new venue when it opens in May 2010.
CELEBRITY APPRENTICES
Cyndi Lauper, Bret Michaels and Sharon Osbourne are likely stars of the next "Celebrity Apprentice," People reports. The trio was spied on the show's New York set, though Trump's reps haven't confirmed the cast yet.
U2 ON YOUTUBE THIS SUNDAY
U2 will stream their 360° Tour concert at Pasadena, California's Rose Bowl on Sunday live on YouTube. "'The band has wanted to do something like this for a long time," manager Paul McGuinness said in a statement on the band's Website. "Fans often travel long distances to come to see U2 -- this time U2 can go to them, globally."
NOT ONLY A MATERIAL GIRL, A NOISY ONE TOO
Living next to the Queen of Pop has its perils: Madonna's New York neighbor on the Upper West Side is suing the co-op board and building's management company, complaining the singer's dance rehearsals and loud music are distracting, Reuters reports.
ROCK'N'ROLL HALL OF FAME GETS MORE
The Rock & Roll Hall of Fame's October 29th/30th concerts at Madison Square Garden have gotten more incredible: Ozzy Osbourne will perform with Metallica, Buddy Guy will join Eric Clapton, B.B. King is pairing with Stevie Wonder and Annie Lennox and Lenny Kravitz are teaming with Aretha Franklin.
LIL' SENTENCE FOR LIL' WAYNE
The genius who gave us "Lick My Lollipop," Lil' Wayne pleaded guilty to attempted possession of a weapon in the second degree this week in a New York courtroom; the plea bargain carries a sentence of up to a year in prison.
LADY GAGA GOES ON
Just two short weeks after her tour with Kanye West was cancelled, Lady GaGa has announced her 'Monster Ball' tour which she describes as a "pop electro opera" and a multimedia concert experience. The tour launches November 27.
FREHLEY WOULD KISS AND MAKE-UP
Should Kiss make it into the Rock and Roll Hall of Fame this year, Ace Frehley says he's open to joining the band onstage. Blabbermouth quotes a new interview from the Artisan News Service where Frehley says, "I really had to let all the negative energy go years ago - for my own sanity and personal health."
BING GOES THE SEARCH
For the first time, real-time status updates and tweets will show up in traditional search engine query results--and it won't be on Google, it will be on Bing.
Quotes of the week
"Was he slight? Yes. Was he frail? At times. But we had a very strong and excited, happy and determined Michael. He wanted to do this more than anything he's ever wanted to do, and he was involved in every aspect of this project. He was there, he was invested, and he wanted to do this. That's the truth. It really is."
-- "This Is It" director Kenny Ortega, in a N.Y. Times story"The record business as we know it doesn't exist anymore. The way people make, market and sell music is so different now. It's just natural evolution. In many ways, it's better, because kids have the chance now to get themselves out there without the middle man and all the bureaucracy and administrative bullshit that you have to endure. On the other hand, there isn't somebody nurturing these kids along. I don't know what the solution is. I'm sure it will all come around full circle again."
-- Madonna, in Rolling Stone"No more emo quotes and fake news with Demi. Yah, I'm done with all that."
-- Miley Cyrus, explaining why she quit Twitter in her rap video posted on Youtube"Certainly amazingly talented, great guy. Needs a haircut though."
-- Brad Paisley, teasing Keith Urban following their duet
The B-Side - 'Blips'
THE ONION (www.theonion.com) STORY OF THE WEEK:
Vince Vaughn Appears On 'Tonight Show' To Deceive Country About Latest Film
HOLLYWOOD, CA-Popular film actor Vince Vaughn appeared on NBC's Tonight Show Monday to brazenly and unapologetically deceive the American people about his latest movie, Couples Retreat.
"It's a really funny movie, and I think people are going to enjoy it," lied the 39-year-old performer, knowing full well that he was misleading viewers into making a decision that was not in their best interests. "It's got something for everybody." Added Vaughn, in another willful distortion of the truth, "It's got a really fun vibe."
Sources reported that Vaughn's Tonight Show appearance was merely the latest stop on a campaign of deception currently being waged by the tall and dishonest funnyman across various media outlets.
Read the rest here and laugh: http://tinyurl.com/yz7emzo.
THE RADIO INTERVIEW on 'THE AMERICAN PERSPECTIVE' - From newsblaze.com
"Steve Meyer is on the front line of global music sales and distribution which he expects will soar to pocket-bursting levels. What's more, he shares his insight and ingenuity with us. Steve gives us both historical perspective and futuristic vision as he chats with Judy about the love of his work, trends of the business and his personal points of view about success, happiness and blending life with the lust for life. Steve joins Judy and helps us discover the thrill of having it all with a sense of balance and purpose. "
You can listen to an interview I did with Judy Piazza of 'The American Perspective' by clicking here: (It runs about 15 minutes)
http://www.thesop.org/index.php?id=10306.
The Blogs
Check out Jerry Del Colliano's (the founder of INSIDE RADIO) daily blog, by clicking here: http://www.insidemusicmedia.blogspot.comWebsite
Check out attorney Ray Beckerman's website at: http://recordingindustryvspeople.blogspot.com where he prints news about the RIAA's ongoing activities
TinyURL
Check out www.tinyurl.com where you can make a smaller URL that will work for any webpage you wish to link to or reference. (As you can see, I'm using it in my news stories above!)
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