snapshot 4/2/08

Researchers Compress Music Files 1000 Times Smaller Than MP3s
University of Rochester researchers on Tuesday said they have come up with a way to reproduce music into a computer file that's 1,000 times smaller than a comparable high-quality MP3 file. The technique involved isn't an audio recording technology; rather, it re-creates the clarinet solo in the same way that a player piano re-creates a piano piece from a roll of punched paper. But in addition to re-creating the notes, it also re-creates the way in which the player played the notes.


eBay bans auctions of digital downloads
Online auction site eBay is changing its policy on digital items that are delivered electronically. Instead of selling these items via auction, eBay now requires sellers to take out 30-day classified ads for $9.95 to sell digital goods. The change is intended to prevent sellers from artificially boosting their feedback ratings by selling thousands of identical downloads for as little as pennies.

Users can still sell digital goods in traditional auctions -- as long as they provide physical media which requires shipping. If you've got software on a CD or DVD for sale, that's fine. Just don't offer buyers the option of digital downloads or you'll be in violation of eBay's new terms of service.


Red Bull Readies Music Label For 2008 Launch
Red Bull plans to officially launch their new record label in 2008 and is now exploring different distribution models. The initiative, which we revealed in November, now has several A&R executives attached to it, as well as a website. The professional recording studio in Santa Monica is said to be active with several indie rock acts, however nothing has been disclosed about electronic music artists, which seems to be a more natural fit, especially for the European market. Red Bull has always sought more innovative marketing strategies, and currently supports several music based endeavors including Red Bull Music Academy and Red Bull Music Labs. The elaborate Santa Monica studio has been letting hand-picked rock-based acts record there since it opened for free, and is being run by Greg Hammer, who left Universal’s A&R team to launch Grace Marketing.

Eschewing massive spending on more traditional advertising approaches, Red Bull enjoys supporting lifestyle events and “experiences” which promote the brand in a more subliminal manner. However, judging by the scale of the endeavor it appears that the company is actively pursuing a revenue model instead of creating yet another music money pit. The question is what can Red Bull truly offer artists in the current climate of plummeting record sales? Recording and touring support are no-brainers, but a comprehensive distribution model is going to be a tough nut to crack. Although, Red Bull has tremendous brand-equity in the market, how will that translate into record sales when they don’t have their own retail presence for physical distribution, like Starbucks.


Amazon Launches Text-Message Shopping
Amazon.com Inc.'s brick-and-mortar competitors have yet another reason to fear the Web: a new service that lets shoppers compare prices and buy things with a few quick taps on their cell phones. Amazon TextBuyIt, which launched late Tuesday, lets people text the name of a product, its description or its UPC or ISBN to 262966 (that's "Amazon" on the keypad) from anywhere their cell phones work - including from inside physical stores.
If Amazon stocks matching items, the service returns two results at a time. Shoppers can immediately buy one of the first two the selections by texting back the number "1" or "2," or they can ask for more by texting the letter "M." New TextBuyIt customers will be prompted to enter the e-mail address associated with their existing Amazon account plus a shipping zip code. The service then calls them and walks through the checkout process using an automated voice system. Shoppers get confirmation by text message and e-mail.


The Four Dollar Insert
Is an iTunes "Digital Booklet" worth four bucks? That's the only difference between the $13.99 iTunes version of the new R.E.M. album and the $9.99 bonus track version from Amazon.com. (Interestingly, Amazon's also selling a non-bonus-track version for $9.99.)Update: It's now a $5 digital booklet -- Amazon lowered its album price to $8.99 at some point during the day.


Amazon.com Digital Payout Same As iTunes'
Our first download sales from Amazon.com just showed up in our CD Baby account. We received 63.7 cents per download, after CD Baby's 9% cut. Which means that Amazon.com is paying out 70 cents per single-song download to CD Baby, which is the same as the standard payout for U.S. iTunes sales of 99-cent downloads.


Sources: MySpace Music Service To Launch This Week
The much-anticipated digital music service from MySpace could go live as early as Thursday, but most likely Friday, Billboard.biz has learned. According to sources close to the discussions, UMG and WMG have either already signed agreements or are in the process of doing so today. EMI is not expected to be onboard at this time, and Sony BMG's status remains questionable. Draft versions of a press release announcing the service are in the review stage, with only a few minor details, and a distribution date, left to finalize.

Simply called MySpace Music, the service is expected to be a one-stop destination for all things music, including DRM-free full-song downloads, ad-supported free full-song streaming, concert tickets, merchandise and ringtones. There may even be a mobile storefront that will include some or all of these services as well.


How Long Until People Start Worrying About The Decline Of The MP3 Player Market?
We've been pointing out for a while that analysts who try to measure "the PDA market" are wasting everybody's time. The addition of personal organizer functionality to mobile phones (or we could just as easily say, the addition of wireless telephony features to PDAs) meant that phones and PDAs were now part of one big "mobile communications device" market. The next step in that trend, already underway, is the gradual merging of the smart phone and MP3 player markets. An analyst is predicting that half of all cell phones will double as MP3 players by 2011. The cell phone market is getting close to saturation in the developed world, which means that manufacturers have to keep adding new features in order to convince customers to upgrade. I really hope this doesn't mean we'll have to spend the next five years debunking silly stories about the decline of "the MP3 player market."


Scott Moore shakes up Yahoo Media Group, music chief leaves
Scott Moore, the former Microsoftie now running Yahoo's media businesses, has reorganized his group, which runs Yahoo's original-content websites. Out the door: Ian Rogers, the outspoken head of Yahoo Music, who had loudly criticized the music industry for insisting on copy protection. Rogers says on his blog that he's joining Topspin Media, a music startup, as CEO. Rogers also oversaw some of Yahoo's video efforts, which Moore now says he'll run personally. The reorg comes in advance of two days of all-hands meetings in Sunnyvale and Santa Monica in two weeks.