MySpace, Majors Make Adjustments For Joint Venture
September 25, 2008, 16 years ago
Antony Bruno from Billboard.biz is reporting:
As the dust settles from the Sept. 25 launch of MySpace's highly anticipated and somewhat controversial new music service, the broader implications of the initiative are becoming clearer.
A joint venture of the News Corp. subsidiary and Universal Music Group (UMG), Sony BMG Music Entertainment, Warner Music Group, EMI Music and Sony/ATV Music Publishing, MySpace Music Service represents a turning point for the recording industry and MySpace itself.
For the major labels, MySpace Music is the cumulation of more than 18 months of experimentation in new business models and a launching pad for their digital music strategies for the future. While detractors continue to level criticisms against them for their alleged role in hindering the digital music market with complicated licensing demands and other limitations, the majors have largely reassessed their approach to the Internet, spurred by the continued slide in physical music sales.
During the year-and-a-half leading up to the launch, the majors have signed unprecedented deals opening the door to ad-supported free streaming, digital rights management (DRM)-free music sales and reduced licensing costs in return for revenue share and/or company equity.
All these elements are present in the MySpace Music deal. As such, the service represents less of an experiment and more of a template for future agreements.
"It highlights the shift in our business to bring business models to the market that meet where the demand is for our music," UMG's eLabs division executive VP Rio Caraeff says. "It's the single largest thing we've done to change the way we do business around the way the customer wants to experience music."Read more here.
