Mixcloud has signed its first direct licensing agreement with Warner Music. Until now, the online radio platform has relied on blanket licences from collecting societies like PRS and PPL. It has been able to operate under such licences because it offers only access to mixes and radio shows, not individual tracks on-demand. Though, given the user-upload element of Mixcloud, it was always an innovative use of the PPL licence on the recordings side.
This first move towards direct licensing with the record companies is part of a plan to build a subscriptions-based business around the content uploaded to the Mixcloud platform. According to the Financial Times, Mixcloud is also in negotiations with Sony and Universal, with plans to allow users to subscribe to the output of specific radio personalities or shows. The subscription option will also apparently allow listeners to download content to listen to offline, functionality the company couldn’t offer under its collecting society licences.
What the company is not trying to do, stresses co-founder Niko Perez, is “do a SoundCloud” and try to compete head on with existing streaming music services in an already crowded market. “We don’t want to do the $9.99 a month [thing]”, he tells the FT. “That’s done. That market is served. What we’re building is going to be very customised”.
Speaking at one of the CMU Insights sessions at this year’s Canadian Music Week conference, music industry consultant Vickie Nauman said that the cost of entry to the streaming market – in terms of the advances demanded by the labels from innovative start-ups – was stifling the development of a broader range of services. Demanding tens of millions of dollars upfront and pushing services to stick to the standard $9.99 model makes it difficult, if not impossible, for more niche services to compete.
Licensing Mixcloud, which does not, and seemingly will not, compete head on with Spotify et al, may be a sign that the major labels are ready to make it easier for smaller services with more targeted audiences to get into and grow within the digital music market.
CMU’s Setlist podcast is on Mixcloud, where you can listen to it for nothing. There’s a new episode out today and everything.[from http://ift.tt/2lvivLP]