Feeds

Digital deals screwing the indie labels?

Stick together, advises IODA chief

The Essential Guide to IT Transformation

Must the digital music revolution screw the little guy? Kevin Arnold, founder of major digital distributor IODA, thinks not. Arnold issued a warning for labels not to do direct deals with internet companies that can't or won't pay them - or only pay them peanuts.

IODA supplies iTunes and Rhapsody with a catalog of thousands of small labels - but it's the streaming upstarts such as Imeem and LaLa that are causing concern.

Arnold says indies only get 25 per cent of the revenue a major may get, and to get a fairer rate means sticking together and negotiating as one.

LaLa began life as a CD exchange, while Imeem started out as a web-based chat service. But both have recently announced their intention to stream full MP3s. LaLa says it will pay for the music through advertising, but has set a ceiling on how much the labels get paid.

"Please remember that it is the collective bargaining power of the entire IODA catalog that gives us the ability to negotiate better deals that benefit all of us. A single label, even one with thousands of titles, cannot match what we can accomplish together, representing more than a million tracks of independent music," he wrote in a letter to labels this week.

"Additionally, remember that IODA's success correlates directly with that of our labels - we do well only when you do well. Retailers like these will not have your financial best interests at heart in the same way."

With the closure of Pandora UK, it's a red hot topic. Pandora founder Tim Westergren blamed the decision on high rates set by the recordings and publishing rights owners.

But Paul Sanders pointed out that Pandora had refused to sign more favourable deals.

And some Reg readers describe the Pandora stance as corporate welfare: the company gave up subscription revenue and doesn't try hard enough to make a go of the business, they reckon. ®

Build a business case: developing custom apps

More from The Register

next story
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Amazon says Hachette should lower ebook prices, pay authors more
Oh yeah ... and a 30% cut for Amazon to seal the deal
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
Nintend-OH NO! Sorry, Mario – your profits are in another castle
Red-hatted mascot, red-colored logo, red-stained finance books
Sonos AXES support for Apple's iOS4 and 5
Want to use your iThing? You can't - it's too old
Joe Average isn't worth $10 a year to Mark Zuckerberg
The Social Network deflates the PC resurgence with mobile-only usage prediction
Chips are down at Broadcom: Thousands of workers laid off
Cellphone baseband device biz shuttered
Feel free to BONK on the TUBE, says Transport for London
Plus: Almost NOBODY uses pay-by-bonk on buses - Visa
Twitch rich as Google flicks $1bn hitch switch, claims snitch
Gameplay streaming biz and search king refuse to deny fresh gobble rumors
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.
Maximize storage efficiency across the enterprise
The HP StoreOnce backup solution offers highly flexible, centrally managed, and highly efficient data protection for any enterprise.