Reblogged: Music as the ideal virtual good

This weekend I was fortunate to attend MusicHackDay organized at Microsoft NERD. I was even more fortunate to ask Nabeel Hyatt about recruiting talent in the music space who will help us geeks find that moonlight on the bridge between technology and entertainment. Anyway..
Nabeels' post "Music as the ideal virtual good" is one to pay attention to, whatever your involvement in the entertainment space is. His illustration of the "music business state of affairs", if you will. is excellent. I recommend walking through his deck. I think the point is, for the creative community as well as the technology, there is a place to make money. It just needs to be found in places it wasn't there before. For Nabeel, it's music inside social games:
"While virtual goods are usually confined to conversations about pixelated clothing and weapons, music is by far the highest grossing digital good. A look at what makes music sell as a virtual good."

My take? If you're an artist, think through your revenue stream. Some of it always will come from straight music sales, no doubt. But people today are much more about the live experience in shows followed by the memorabilia that comes with the experience (that's another way to name your CDs or T-shirt). Of course music creation is the driver for all of it, but on it's own, perhaps is not what's going to get you money.

Chart Courtesy: Nabeel Hyatt

Can Freemium Content Model Survive?

Image Courtesy: HypebotFollowing last weeks' rumors about MySpace starting to charge for streaming and this weeks'MySpace-iMeem possible acquisition rumors, there's a lot of (repeating) talk about the business model of free content. Of particular interest is Wireds' post "Music: Too Expensive to Be Free, Too Free to Be Expensive".

Here's some of my thoughts, and what led me to start Adva Mobile

1. Licensing Music from the majors is a difficult financial commitment to recover. If you're small and nimble, prove your bus model with the long tail, or at least the smaller players before paying the huge upfront fees. Sure, you gain (if you're lucky) the major's marketing wind behind your back, but when the honeymoon is over, you start paying. Another Wired writer's comment is almost (but not) funny: "In the world of online music, you're nobody until somebody sues you"
2. "Advertising was supposed to be music’s magic bullet". Not. In all metrics, advertising payouts are dropping fast. Even on mobile, even when you can provide pretty accurate fan profiles, the payouts are way below your operating costs or licensing costs (if you have any).
3. "Fans don't pay/Expect free". Not (again). As Debbie Chachra explained in her insightful post, fans will pay for relationships with the artists they follow in a number of levels. From tickets, hard goods to funding artist recordings, fans will pay for the experience that comes with the music. You just need to find a way to leverage those.

What's interesting in the entertainment space is that there seem to be no big winners in the game. Big problems = Big opportunities. That's what I'm banking on, anyway.

IODA gets iPhone app for artists from MixMatchMusic

Image Courtesy: MixMatchMusic

Congratulations to MixMatchmusic and Alan Khalfin for getting IODA on the bandwagon for their artist mobile promotional tool. IODA is a key player in the marketplace and their recognition that promotion on mobile is important, is great.
I found the quote from Adam Rabinovitz (IODA VP Marketing) interesting: "The MobBase iPhone app is an innovative and low-cost solution for independent artists who want to participate in the explosively popular iPhone app market".

We at Adva Mobile asked ourselves the question whether an iPhone app was the way to go initially, or Mobile Web. It was fan reach vs. hype. Admittedly, an iPhone app has far more hype than mobile web. From our little research, it seemed like artists wanted to reach all of their fans in the crowd, using simple and known tools like mobile web and SMS. We ended up deciding that resident iPhone, Android and blackberry app would come second.
The 2nd question I'm asking myself, reading the article, is the economics of providing artists a tailored app. We all know creating and deploying an app is not an insignificant effort. What kind of revenue artists need to make to pay $20+$15/month just for this app. (BTW, the iLike iPhone is not free). What's gonna happen in a year when Android is expected to come close to the iPhone reach? Are artists expected to pay another $15/month or more? An artist who can justify this expense is a household name. Selling out big venues, music and merch. Again, this is a dilemma we've been discussing at Adva Mobile. We ended up deciding that by charging artists that much, you essentially give up a huge chunk of the market. Our service is currently free, and maybe in the future we'll add some premium services.

Overall, I'm delighted to hear these news. It means more people add mobile to the promotion toolbox, and that's good for everyone!

our first partnership: ArtistData

I'm more than excited to announce our first partnership, with ArtistData. Not only because it's big news for Adva Mobile, but also because ArtistData's service is so spot-on: giving musicians a service that enables them to enter shows, news, blogs and other assets once, and automatically aggregate that information to other sites. It's the right approach for musicians, who are already sufferring from lack of time to deal with self-promotion on multiple sites.

This integration will allow musicians to bring their assets from ArtistData automatically to their mobile fan club on Adva Mobile. It will happen automatically daily (you need to set it up on both sites). 

I think it's very cool and hope a lot of musicians will benefit from it. Certainly a step in the right direction, for everyone.

You can read more details here.

Mobile Shopping Taking Off In US

Mobile Shopping Taking Off In US: A survey of 3,305 online consumers in the US by Pricegrabber.com has found that nearly 58 percent of them own a mobile phone capable of connecting to the web (8 percent own an iPhone). "One in 10 online consumers said they purchase online from their mobile device, 16 percent compare prices and another 16 percent research product details/specifications," writes FierceWireless. Of those in the survey who did makes purchases from their mobile phoens, 58 percent have purchased digital content for their phone, 51 percent have purchased consumer electronics, 37 percent have purchased computers, 36 percent have purchased books, and 31 percent have purchased clothing.

Source: MocoNews

It's coming, finally.

Adva Mobile Coverage on Mobile Marketer and Mass High Tech

We got some nice coverage today with Mobile marketer and with Mass High Tech, check it out:

Music artists tap Adva Mobile’s mobile fan club service

Adva Mobile salutes independent artists with social network app

Adva Mobile Launched

I'm excited to announce that earlier today Adva Mobile opened the service for musicians to sign up and start creating their mobile fan clubs. In the past two months we had the fan experience working: sending text messages, viewing mobile internet pages, downloading songs to fans' phones, sharing on twitter etc. Now we enable artists to control their messaging, mobile pages, content and more. For those interested, here's the press release.

The beta period was rewarding in that it taught us a lot about what's important to the bands and to the fans. We good great feedback and enthusiasm although we had no marketing budget. It was the power of the promoters, bands and fans to spread the word. THANK YOU FOR THAT!

Now we need to concentrate on the next challenge, and we could use your help: get the word out to as many bands as possible. We could use your help: if you know a band, or your neighbor's kid plays in a band, tell them about us: Adva Mobile, the mobile fan club service: http://www.advamobile.com.

On another note, Adva Mobile now has it's own blog: http://www.advamobile.com/blog. There is also a Twitter account: Twitter.com/advamobile.

Look for Adva Mobile stuff over there. In the mean time, I'll debate where each of my ramblings go, here or there :-)

The Value of Unlicensed Music “Shared” Worldwide on P2P Networks in 2007 was US $69Bn

Time to think how to create revenue channels from content maybe? (Source)

Adva Mobile on Facebook & YouTube

Check out Adva Mobile's Facebook page as well as our YouTube shout videos. Twitter feed coming :-)

Another DUH moment

Textually posted this post titled "Mobile Music Business Sluggish?".
Firstly I'd say, although the title is a legitimate question, it proposes something that clearly ignores the reality of making business in mobile media in the US. Not to mention suggesting that the mobile music as a whole is sluggish based on US survey results...c'mon

Here's a couple of pearls from it:
"...only five percent of U.S. mobile subscribers side load tunes from their computer while less than half of that, two percent, download tracks over the air, despite the emergence of online stores from Nokia, Jamba and MusicStation..."

Why is anyone surprised that in the US, consumers aren't aware or interested in getting multimedia on their phones? that direct-to-consumer initiatives are well behind those in EU, for example (despite large marketing budgets and fantastic technologies) ? have you NOT been reading about Verizon 3 cents-per SMS cost rise stunt just a few days ago (as example)? There's a reason why even established, strong D2C players had not penetrated the US market, and we all know what that reason is.

which leads to the next quote:

"about 66 percent of respondents to a recent survey said nothing would motivate them to listen to music on a mobile."

Oh sure. Spending another $100 or more on a music player when your phone could do the same or better job playing music makes a lot of sense when you're 22 and barely paying your rent.

No. There's a reason for this survey result and it has to do with consumer awareness and expectations.
In a recent local focus group I ran, 6 out of 8 22-year old interviewees did not know they could put music on their phone and listen to it as they please, or faced infinite trouble doing it. They said: "I DIDN'T KNOW I COULD DO THAT" or "I couldn't do it"

It's incredibly difficult for D2C players to raise consumer awareness and expectations, and that's no coincidence. Second, even if the consumer knew how to load music to their phone, they would usually be blocked from doing it, unless they have 5-inch thick geek glasses to figure it out.

Close with this related comment from a different post:
"Whilst MNOs such as Vodafone carry on pushing further into mobile advertising, several major advertising agencies continue to express the significant disconnect between their wish to involve the mobile channel as part of an overall campaign and the technological hurdles involved."

Need I say more?

Why Selling Music Still Matters... and Free Means Paid (Reblogged from Digital Music News)

Go read this great article by Paul Resnikoff...here's a couple of great snippets:

"...(traditional music revenue channels plummet) This raises the question of whether artists are smarter to give away their recordings, and focus on more lucrative areas of the value chain. Instead of charging 99-cents for an MP3, why not charge $9 for a t-shirt, and $29 for a concert ticket from a stronger flow of fans?"

"Of course, from the non-diversified label perspective, the recording is an all-important component of the business model."

"... (new ways to approach music and music-related "products") Those are ingredients for a deeper, more engaged connection with fans, a critical aspect of successful marketing strategies. Some artists like Radiohead enjoy massively-connected fan relationships, while others are just starting the process. Either way, panelists agreed that artists carrying a strong connection with their fans gain more in the marketplace."

That's exactly what Adva Mobile is all about.

Text McAlister to 70734 and try it yourself.

Adva Mobile tonight @ Church Hear Now Live show

Tonight on stage...Old Jack, Someday Rome, DPR, Tony Macsata band & Hot Knives...looking fwd to it! Another great HeaNowLive event!

Now on MySpace

Adva Mobile now has a MySpace page. Feel free to connect to us, and if you're a band, why don't you try our free mobile marketing service...we'll set you up in seconds.


We're looking for Facebook developers to develop a kick-ass Feacebook presence...drop me a line if interested!

Promo for Sep 27th show

Wow...I didn't even have time to post this. Great show last night, and great turnout from fans requests

Tonight, McAlister Drive's Video show + Lagoon, Club Felt Boston

They'll be providing unique mobile experience to their fans, with Adva Mobile:

Send to your phone, OR text McAlister to 70734



Send to your phone, OR text mybandLagoon to 70734



stay tuned for Saturday HearNowLive show!!!

New Report on Teens, Cellphones and Music

It's becoming a habbit to quote Marc Cohen, who voices the 2 key points from this interesting research by Harris Interactive:

• Cellphones are an ideal device for ad-supported music
• Teens and tweens are the ideal target market for ad-supported music
• 6/10 teens will provide personal details

Yes yes yes and yes. He's correct. I just hope more people will realize that, soon.

Brring

One of the interesting companies presenting yesterday at Webinno was Brring. Free ringback tones for the crowds.
They got the formula right...music, free, for the crowds, that should work. maybe.

The service (read more on their site, but if you're lazy, here's what I got:) you upload your own tune, cut it to be a ringback length, and select who hears which tunes. (Future feature, community-style transactions (I guess) to share & recommend tunes). You get a number from them and whoever calls that number will hear a 5-10 sec audio ad, and then (and only then) the call will be forwarded to your phone and it will start ringing.

So a couple of thought (Otherwise why would I make this post?).
Here's the stuff I applaud Brring on:

• Pretty bold: moving in on the operators (and vendors) ringback market, which although been stable or declining, is a pretty chunky market in a D2C move
• Formula's right: Free, D2C, social for the crowds. It's all there. I can see kids rushing to it
• Bring a friend and get paid feature: sure, even better. Free is not enough anymore (I see that too in Adva) in audience acquisition. So something for "bring your friend" will ignite a bigger fire
• Not married to the carriers: I suppose they found a way to work around the carriers with this "Brring number" they use. Either way, not marrying the carriers is a smart move
  

Here's what I'm not convinced about:

• Maybe most important, the content licensing bit. I've not read through the complete T&C, but briefly it looks like they hand the responsability for content to the fans. That's not gonna fly. If that's the strategy, they better get a good lawyers
• You force someone who calls you (on this new number that you need to publish) to listen to the ad before your phone begins to ring. That goes right up the advertising tolerance discussion. hmmm...unsure about that. Good news (I think), you can turn the ads off for selected people (or can you? unsure)

Maybe all of these are issues that can be solved by figuring out the right product definition, but where the real smarts is, is figuring out what would motivate people to forget about the heavy Verizon advertising everywhere (Boy, with that ad budget, I wonder how they maintain their network) and go to their service. The typical D2C challenge.

Good luck guys!

Sincerely, the Management

Sincerely, the Management were on stage last week, fun band and fun show. They used our mobile service and a few fans checked it out.
Here's their shoutout, sorry it's a bit blurry:





We're on tonight with OldJack, Gardner and Michael Bernier at FestEvolve. Thanks to HearNowLive, we'll be next week at Copperfields and the following week at Church.

Last Weekend for Adva Mobile

So between crazy weeks and weekends I'll try to make the occasional post about how we're doing at Adva Mobile. I think though that soon I'll start looking for a proper blog for us...recommendations welcome.

So anyway, last Friday we were at another HearNowLive show, at Church, which was a lot of fun and a great show. HearNowLive have a great cover of the show.

We got great feedback from all the artists, they were interested and did the shoutout really well (Someday Rome took it to another level :-))

We estimated a crowd of 120 fans at the peak, and so a collection of close to 15% phone numbers in total, and higher numbers of messages from fans requesting content, that's not a bad stat (for the very limited set of features we already have live).

We're working on the next gigs, and new feautures. Check out McAlister Drive's MySpace page with our new widget, and this Thursday Club d'Elf is at the Lizard Lounge using trying our service.

much more to come...

Tonight @ The Church with HearNowLive!

I'll let you know how it went :-)