Seth Gilbert, 04-1-2009
Legend has it, the great blues musician Robert Johnson went down to a crossroads and made a deal with the devil. In exchange for unfounded musical talent, the story says, he traded his soul. It was a yes or no choice; be a guitar hero, or not. He chose the immortality of his music.
The music industry is hardly so fantastic but like the legend, the thin line between the industry’s successes and failures, or evolution and regression, seems to hinge on the big decisions made when the road of progress forks.
Looking at the music business over the last decade, as its struggled to evolve to the changing digital landscape, two pivotal moments jump out. The first was the evolution of file sharing networks and how the music industry chose to handle them. The second was the advent of Digital Rights Management (DRM) encryption and how the music industry steered its early use.
Now, it’s starting to look like the industry is reaching a third crossroads: license fee rates for streaming services .
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Seth Gilbert, 03-30-2009
Disney’s castle has been locked down tightly when it comes to distributing its video programming online but that now appears to be changing. Last week, word leaked that the company was discussing a possible content partnership and equity stake in News Corp’s and NBC / Universal’s joint venture, Hulu. This week, today, the Disney Media Group announced a content deal with YouTube.
The new arrangement will lead to the launch of several ad-supported YouTube channels featuring short-form programming from Disney’s ESPN, ABC, and SOAPnet brands.
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Seth Gilbert, 03-27-2009
Recapping a few quick bits from around the gaming world: Rock Band has crossed into rare air and achieved a billion dollars in North American sales, EA will forego using the controversial SecuROM DRM system with the Sims 3 and Eidos is now one step closer to closing its sale.
The details….
ROCK BAND’S ASCENT
Guitar Hero was king for a year, now the throne belongs to Rock Band.
MTV Games, Harmonix and Electronic Arts jointly announced that their Rock Band franchise crossed the billion dollar revenue threshold in North America (based on NPD data), achieving the milestone faster than any other game in history.
Hitting the milestone in fifteen months, the game bested the prior record of 26 months claimed last January by Activision’s rival Guitar Hero brand.
Both music games have proven fantastic sellers. Not diminishing that fact but as a footnote for looking at the revenue records, it is important to note the totals for both games is skewed because of their pricing structures. Click to Read More
Seth Gilbert,
You don’t need a crystal ball or a keen sense of current events to know the newspaper business is a mess. Regular bankruptcy and layoff headlines, or even just the reduced quality of many local papers (which are relying on less original reporting, fewer pages etc), make it immediately apparent to even the most passive watcher. But now there’s even more evidence: new numbers from the Newspaper Association of America out yesterday.
2007 had been the market’s worst year, that is… until 2008 wrapped up.
According to the NAA’s figures, total ad revenues dropped off another 16.6% to $37.8b for the 2008 year. The print segment was off 17.7% to $34.7b while online revenue, a bright spot in the past four years, slipped 1.7% to $3.1b.
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Seth Gilbert, 03-26-2009
The recording industry has had a love affair with the idea of variably priced music for years. As a tool, it’s a way to manage supply or even manipulate demand. If an album (or single) isn’t selling or there’s excess inventory, for example, the price can be trimmed and the bargain used as a lure. If sales are good, or an album is starting to climb a key ratings chart, price adjustments can tweak the momentum.
The practices are common but in the digital world, some retailers have fought against it. For the better part of six years, Apple’s resisted its use at iTunes but that’s changing.
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Seth Gilbert, 03-25-2009
Advertising is sometimes seen as the great subsidizer, the mighty and powerful Oz that can pay for all kinds of Internet media. But Oz couldn’t give the Scarecrow a brain and advertising can’t give all Internet content businesses a good looking income statement. Free (ad-supported) online radio stations are a case in point. As the sites grow in audience scale, the license fees behind the music they stream grows too. Pennies (or even fractions thereof) per song play adds up fast when millions of users are lounging in the soundscape. Paying that expense with ad income can be a difficult calculus when ad markets are trim.
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Seth Gilbert, 03-24-2009
Brazil, Russia, India and China (collectively “BRIC”) are the world’s leading emerging market countries. As a whole, they represent 40% of the world’s population. Their middle classes presently spend well above a trillion dollars a year, and counting (according to the World Bank). Goldman Sach’s has predicted the BRIC middle class will cross the threshold of a billion people by 2015.
No matter how you dissect it, BRIC represents a huge market for consumer product companies. The video game industry has barely touched it. With consumer income levels still relatively low, hardware makers have stayed away. With piracy threats a serious concern, multi-national software developers have avoided developing localized content or pushing the issue.
That could soon change. In one of the more interesting announcements to come out of this week’s Game Developer’s Conference in San Francisco, San Diego based Zeebo announced that it’s found what, it believes, could be the key to opening the door to gaming fortune in emerging market countries.
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Legend has it, the great blues musician Robert Johnson went down to a crossroads and made a deal with the devil. In exchange for unfounded musical talent, the story says, he traded his soul. It was a yes or no choice; be a guitar hero, or not. He chose the immortality of his music.
