music_news 91 posts

Maddona announced that she ends her 25 year long relationship with the Warner recording company. Instead she intends to sign a 10 year contract with Live Nation Inc. a concert touring company. This new $120m deal will include touring, merchandise and releasing of 3 new albums.

"The paradigm in the music business has shifted and as an artist and a businesswoman, I have to move with that shift," Madonna said in a statement. "For the first time in my career, the way that my music can reach fans is unlimited ... Who knows how my albums will be distributed in the future?"

However, Warner will publish one more album by Madonna within a year and will retain all the recording and publishing rights to such hits as Like a Virgin, Vogue and Music. The rights to Material Girl though are under question.


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This week the Warner Music Group, the forth-largest label has started to sell digital downloads without DRM protection.

The company opted not to work with the iTunes store for this project, although it’s been announced that downloads are iPod compatible and are priced similarly as at iTunes: around 99 cents per song.

To prevent downloads unprotected by DRM being leaked to the file sharing networks, files are downloaded straight to portable MP3 players without being stored on a PC.

The Warner Music Group is the second label sell DRM free downloads after EMI did the same last month.


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Lala Launches Free iPod Music Service, Reuters
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Nine Inch Nails speak out on record labels continuing to screw the consumer over.

They give an example of “absurd retail pricing” of their recent album Year Zero in Australia. “Shame on you, UMG. Year Zero is selling for $34.99 Australian dollars ($29.10 US). No wonder people steal music. Avril Lavigne's record in the same store was $21.99 ($18.21 US).
By the way, when I asked a label rep about this his response was: "It's because we know you have a real core audience that will pay whatever it costs when you put something out - you know, true fans. It's the pop stuff we have to discount to get people to buy."
So... I guess as a reward for being a "true fan" you get ripped off.”

NIN are critical of marketing tricks used by the labels. “The point is, I am trying my best to make sure the music and items NIN puts in the marketplace have value, substance and are worth you considering... read more

Warner reported its second quarter financial results this week. The label had a “net loss of $27 million, or 19 cents a share, compared with a loss of $7 million, or 5 cents a share, a year earlier,» according to Reuters.

This news follows the announcement that Warner Music Group was about to lay off 400 of its staff.

Among the reasons for the revenue decline the label marks out piracy, “changing consumption patterns in the shift from physical sales to new forms of digital music".

Nevertheless, Warner expects the situation to improve when the company implements its restructuring plan and boosts digital distribution of its music. “…we'll start to see benefits of that over a couple quarters after that, so certainly early fiscal 2008,” said their statement.


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Warner Music posts wider loss, Reuters

Warner Music Group is planning to lay off 400 employees as part of a restructuring campaign and “place further emphasis on digital strategy and distribution, sources say” (The Billboard).

In January earlier this year EMI made quite a similar move and announced that it would lay off 900 of its staff (along with a few top executives). This was a sign that the label was not doing very well as later few attempts to sell its catalogue and the label itself followed. Finally, EMI ended up releasing its music in DRM-free format. The latest offer to buy the label for $6 billion was rumored to happen. (read more

Warner Music Group has announced last week that it intended to sell digital music content via the MySpace Music Service. The label plans to offer its top selling artists. The downloads will be in available in DRM protected WMA format making them unplayable on iPods.

The prices and further details haven’t been revealed yet.


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Warner Music Group's Artists to use SNOCAP MyStores to Make Music Available for Sale Through the Myspace Music Service, Company press release
Warner Music Group Joins Snocap, MySpace Initiative, Digital Music News

Last week Warner got very displeased with an online store which tried to sell Warner albums without DRM. The site offers albums in MP3 format at a discount compared to a physical CD. Customers get MP3 files plus a CD could be shipped later as an option.

According to Reuters “Warner Music Group on Thursday demanded that online retailer AnywhereCD remove its digital albums from the site, saying the start-up had violated their agreement by selling Warner's music without copy protection software.”

It’s OK by Warner if the store helps customers to rip the CDs into MP3s but it’s not OK if those MP3s are without DRM. This way of selling music "flagrantly violates" the agreement between the label and the store.

Earlier this year Warner Music Chief Executive Edgar Bronfman had expressed his views on DRM. "There is no reason to conclude that music is the one content category that should not or cannot be protected, simply because there is an unprotected legacy product available in the physical world," he... read more

It has all been only rumors with no official statements that EMI is up for sale or at least its catalogue could be available in DRM-free MP3 to anyone who offers a handsome advance payment. According to Bloomberg, potential buyers interested in the catalogue included Microsoft, Apple Inc., RealNetworks Inc., Yahoo! Inc. and Amazon.com Inc. However, no one had offered enough for EMI’s music and the talks were suspended.

At the same time Warner Music Group Corp. and reportedly a number of private equity groups were in turns trying to buy EMI. Those negotiations haven’t produced any result yet as well.

For the time being EMI keeps reducing its revenue and profit forecasts. It has warned about its falling profits already twice this year. Nevertheless, EMI’s shares rose a few percent after the news of a potential acquisition.

More news might follow, but so far nobody seems to want either the company or its catalogue for the price demanded.


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The music industry met the Apple’s proposal to abolish DRM with no enthusiasm.

Rather music executives pointed to Mr Jobs that interoperability is the issue and that Apple shouldn’t pretend its all labels’ fault when European consumer protection bodies outlaw iTunes for its proprietary DRM. IFPI commented that contrary to Apple’s CEO argument interoperability won’t be that disastrous to quality control and security. The Apple’s appeal to the labels that they are selling 90% of their music without DRM protection anyway was rejected with indignation.

The Norwegian Consumer Council which had recently declared the iTunes store illegal was not impressed either with Apple’s efforts to shift the blame on the labels.
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