The usual suspects were in the news again this past month. At this point, it’s a game of rumour and speculation, so there isn’t any “real” news until we hear formal announcements coming from Google about their rumouredmusic service or when Spotify launches their service in the US.

One notable thing this past month has been the huge influx of new music web services which I’m jokingly guessing is because all the computer science college kids, now out on summer break and with time on their hands, are hacking and dabbling away. Some are interesting but generally, we are seeing the same ideas rehashed. Some are building very good standalone features, but nothing that can you classify as a viable business, at least not as this time in their development. You can take a look for yourself below and decide.

Other than that, investment activity was very quiet, which isn’t unusual considering we are in the heart of summer, and a lot of people are taking holidays.

With that said, let’s jump right into July’s music+tech recap.

Investments and Mergers/Acquisitions

Billboard has written up their mid-year music startup investment analysisand there were 30 deals (down from 45) for the first six months of 2010. Most deals were small investments and acquisitions, involving music download or streaming sites such MOG, Veoh, Jamendo, Vringo and Slacker and services for consumers, artists or labels such as Hello Music, Swaptree, Jelli and ArtistData. Overall, investment totals are down compared to last year.

Total 2010 Investments as of July 31st, 2010

Q1/10: $99.6m

Q2/10: $104.25m

Q3/10 (to-date): $1.97m

2010 total to-date: $205.97m

• Mediazoic receives funding from Slaight Communications, a major Canadian media investor.
• SeatGeek Lands $1 Million for Predictive Sports and Concert Ticket Pricing
• Citizen Groove, a digital portfolio/network for music students, receives $250k in Series A funding.
• GigsWiz, developers of analytics/ services for artists, agents & promoters, receives €$150k ($197kUS) in seed funding.

If you are a music startup and want a chance to pitch at MidemNet next January 23-25, 2011, now is your chance to signup at MidemNet Lab. Deadline for applications is October 31, 2010.

As I mention each month, this isn’t a comprehensive list and the numbers (where disclosed) have been pulled from public sources but it still gives us a sense of general investment activity in the music tech space. If I missed any deals, please don’t hesitate to comment below.

Music Services and Apps

Google Music takes a step closer to reality- Google’s plan to challenge Apple’s dominance in the music marketplace is advancing more rapidly than expected. P2Pnet has a critical take that is worth considering.

Ready…set…discover more music on YouTube- A few months back, Vision Critical’s Radio Futures reportindicated that YouTube is the most popular web radio/music service in Canada (Spotify and Pandora are not available and our options are limited) and third most popular in the UK (after Spotify and LastFM). I was initially shocked but now understand why because I’m finding myself using YouTube more and more to listen to music. Eric Garland, of Big Champagne noted that YouTube has become the biggest name in music. I can definitely believe that.

Ultimate Chart- An aggregation of timely, relevant metrics from Amazon, iTunes, YouTube, Pandora, MySpace, Facebook and many others. The top 20+ is fairly predictable and really isn’t for anyone into non-charting, indie bands. No longer driven by sales figures, it is an impressive use of real-time technology that gauges the buzz in the different online channels that music consumers inhabit.

MOG Mobile Music App Now Available for iPhone and Android – I’m hearing from some subscriber’s that this is quite an impressive app and are quite happy with it.

MP3tunes and Roku Partner To Bring Personal iTunes Music Collection To TVs – Media consumption now the blurs the lines between devices, services and media type. People will pay for media convergence that is convenient, personalized and extremely easy to setup. One other announcement last month shows that MP3Tunes is on quite a roll having also launched their “Buy Anywhere, Listen Everywhere”wireless synching initiative.

Flyer – A Desktop Adobe Air app (PC and Mac) that utilizes the Bandsintown APIand ties into your iTunes library to display upcoming concert dates from bands in your music library.

Lyric Discovery – This site helps connect professional and aspiring songwriters with musicians and music industry professionals.

Playlost?- View your entire music collection as a randomized hexagonal grid and make playlists by long, snaking chains.

Mixest- In talking to one of the founders of this service, he told me that “Mixest began as a satirical website for hipsters who found Pandora too mainstream”. Built using HTML5, you can stream music on your iPhone/iPad (works in the background on my iPad) and the selection of curated indie music is actually quite good. I also conducted a Q&A that you might want to check out.

Tunited- Ultravox frontman Midge Ure launches Tunited, a “fairly traded” music site for indie/unsigned artists.

Cloud Music – Very clever beating Google to the punch, for now. The Cloud Music iPhone App Streams Tracks Uploaded to Google Docs.

Xumanii- This service lets you stream your own live shows (concerts, TV, talk shows, special events) built around social networking features that is pretty much Twitter, Facebook, MySpace, uStream, Reverbnation and YouTube rolled into one.

Clear Channel’s Free Mobile Radio Apps Are A Money-Maker – 8 million downloads, average user listens to 3.5 hours and visits an average of four stations a week. Radio station’s overall audience up 15 percent when combining both apps and online, thus creating additional opportunities for ads.

AudioBox.fm- Certainly no shortage of cloud based music streaming services, as Audiobox.fm launches their new iPhone app letting you access your music from anywhere.

Who’s Who In The New Music Gold Rush- PaidContent has put together this extensive matrixcomparing music services like Spotify, MOG, We7 and many others.

The Indie is music cross platform application that uses social influence to help in the discovery, promotion and distribution of music created and owned by unsigned artists, indie artists, and indie labels.

Foot Pedal Turns Sheet Music Hands-Free On The iPad- AirTurn will be launching a Bluetooth page turner foot pedal for the iPad and other Bluetooth-equipped systems that will allow musicians to turn their sheet music pages by foot.

117 Audio Apps for Apple Lovers- Great round of music apps for the Mac, iPhone/iPod Touch and iPad.

IOUMusic – Had a chance to speak with Rob MacArthur, a fellow Canadian from the East Coast, who just launched this patronage/donation platform for fans and artists. Working in the music business for a number of years, he understands the challenges bands face and put together this platform to help facilitate fan funding of their favourite bands.

Opinions, Insights and Analysis

The Service-To-Device Journey: The Key To Success For Digital Music Product Strategy – Music product strategists need to consider that filling a music offering with benefits counts for naught if the barriers of poor integration and implementation render a music experience inert.

Movie, tech giants prep universal online media store – 55 technology companies, content publishers and content distributors have banded together to promote the format under the brand name Ultraviolet. This is all about content control, centralization and standardization. This is an attempt by all the major media companies to retain their power over the consumer by converging their media. Will it fly?

The New Media Content Revolution – “There are many new opportunities cropping up for new media. It is important to understand one thing more than anything else – the consumer.”

Suddenly, I Don’t Think I Want To Own Music Anymore – A personal piece by Brendan Mulligan, and one that I’m hearing more and more from music fans. People want access, everywhere, on any device. I’m also starting to feel this way. The overhead involved with either physical objects or the worry and hassle of downloading and backing up your music collection is turning people off given new lightweight music access options.

On File-Sharing: Are You Smarter Than A 12th Grader?- A thought provoking essay by Kyle Bylin over at Hypebot. Worth taking the time to read both the essay and comments.

The New Music Seminar was held in New York City on July 19-21st, 2010 and there was a lot of coverage by Hypebot, Digital Music News, Billboard, NYSBAand Ryan Van Etten at VirtualMusic has a great photoset. If you are inclined, check out the Twitter stream for #nms and New Music Seminar.

As Always, Mobile Music Faces Uncertain Future – ” Operators who deliver content over their networks want a piece of the pie, but margins in the subscription-music business are already razor-thin.”

The State of Internet Music on YouTube, Pandora, iTunes, and Facebook – There is such an overzealous obsession with metrics in particular the big three: friends, fans, and followers (or FFF). That’s what happens when the bean counters are let loose; music is nothing more than a product to be shifted and sold. Rinse and repeat.

Last.fm: Breaking the US, with 1,000 scrobbles per second- US audience has risen from 3.5 million monthly uniques 12 months ago to 8 million now, and has exceeded revenue targets. 30-40m pieces of listening data is generated every day – equivalent to 1,000 scrobbles per second.

Using an iPad in the Music Industry – The Daily Rind has run an informative three part article on how artists can take advantage of the iPad. Part 1: Artist Assets, Part 2: In the Studio, On the Road, Part 3: Merch, Marketing and Managing.

BlackBerry aims for music industry domination- In a Q&A session with Research in Motion’s director of consumer alliances Alex McCallum talks about why it’s really Blackberry that makes mobile music tick.

The Future of Music Coalition put together a great weekly recap of music+tech+policy+law that is always worth keeping an eye out for.

Upcoming Music + Tech Events

• 2010 En Sound Music Awards & Conference – Houston, TX – August 6th – 8th, 2010
• North Park Music Thing (NPMT) – San Diego, CA – August 13th – 14th, 2010
• Indiegrrl Music Conference – Nashville, TN – August 19th – 22nd, 2010 Bandwidth Conference – San Francisco, CA – August 19th and 20th, 2010
• Cutting Edge Music Business & Roots Music Gathering – New Orleans, LA – August 25th – 29th, 2010
• iNTune Music Conference – Darwin, Australia – August 27th – 28th, 2010
• Coast 2 Coast New Music Industry Convention – Miami, FL – August 27th – 29th, 2010

If you have an upcoming event you want us to post in next month’s music + tech recap, please get in touch with me.

Gabriel Nijmeh is a business analyst, passionate music lover and guitar player. He currently advises a couple of music startups, including Mediazoic, a real-time social DJ platform and co-founded the Toronto edition of OpenMusicMedia which brings people together to openly discuss the intersection of digital music, media and culture.

Most of the music technology scene I cover is US based with a little bit out of Europe, mainly the UK thrown into the mix. From my perch here in Toronto, I can tell you that we have a thriving music scene across our great country of Canada. We are graced with some of the world’s best artists, producers, sound engineers and as an overall economy, we are loaded with a lot of top flight tech talent across different industries.

We are starting to see smart, innovate people meld the two together to establish Canadian music technology companies who are determined to create world class products/services.  We aren’t just good at hockey and throwing snowballs in the dead of winter! We love our music, our artists and many of us are early tech adopters, as evidenced by the young and fledgling music + tech start-up scene developing in cities like Toronto, Montreal and Vancouver. Just off the top of my head and by no means is this an exhaustive list, we have the likes of Backfed, Mediazoic, IOUMusic, LyricFind, Fanteraction, Zunior, OpenMicScene, Ecoutez and Bandzoogle doing some amazing stuff. And the latest, YouPhonics, which just launched at NXNEi last month.

Fresh out of the gates after being heads down developing a new music creation/collaboration tool, Aidan Nulman threw open the digital doors by hosting a launch party which brought together more than 100+ people passionate about music, technology, arts and culture. Right now the service is invite only but if you keep an eye out on the YouPhonics and Aidan Nulman’s Twitter stream, you should be able to get your hands on an invite. Or, leave a comment and I can hook you up as well.

On top of growing his start-up, Aidan is chronicling life as a first-time digital music entrepreneur. His posts are very engaging, witty and is sharing his experiences in open and honest detail. Anyone who is currently working on their start-up will likely share a lot of the ups and downs facing every new, young company. A must read in my opinion.

The Canadians are coming, with a few cases of beer in hand! Keep an eye out for us! You will be seeing and hearing more about music+tech innovations coming out of Canada!

The other industry event I attended was the PriceWaterhouseCoopers launch of the annual Global Entertainment and Media Outlook: 2010-2014.  The study covers the global market for music, video games, movies, newspapers, magazines, radio and advertising.  Following a year of decline in 2009, the global entertainment and media market is forecasted to grow by 5% compounded annually over the next five years,  reaching US$1.7 trillion, up from US$1.3 trillion in 2009. Latin America and Asia Pacific are the fastest growing regions, while growth in the world’s biggest media market, North America, will be much slower. Consumer spending is expected to be strongest in the video game, TV subscriptions and movie markets. Forecasted music spending is near the bottom of the list, which is probably not a surprise to many people. Glenn Peoples at Billboard.biz provides his analysis on PwC’s music (physical/digital) forecasts.

Some of the major themes explored in the report include:

• The rising power of mobility and devices and the growing dominance of the Internet experience which is being driven by consumers.
• Media consumption has become a collective social experience.
• Testing the limits of paid content and a move from ad-supported to hybrid revenue models. There is a lot of experimentation with business models trying to find the right mix.
• Increasing engagement by going “hyperlocal” and consumer readiness to pay for content driven by improved consumption experiences and convenience.

You can download a copy of the presentation here (PDF) which provides global stats by various market segments and insights into what is yet to come. Combine this report with Morgan Stanley’s internet trends and mobile technology research and you have yourself a pretty good base of “free” market forecasts and intelligence to work with.

Investments and Mergers/Acquisitions

The first few months of the year started off strong and by the end of the second quarter, investment activity slowed down, with a lot more takeovers and acquisitions this past month. It’s still a pretty challenging environment for any digital music startup looking to raise money.

Total 2010 Investments as of June 30th, 2010

Q1/10: $99.6m
Q2/10: $104.25
2010 total to-date: $204m

• Sonicbids Acquires ArtistData, Terms not Disclosed. Will we see more music service consolidations?
• HP buys streaming music firm Melodeo for between $30m-35m
• Ticketfly buys music event site Gigbot to gain ground on Ticketmaster
• Triton Digital Media Acquires StreamTheWorld
• Pandora Raises an Undisclosed Fifth Funding Round Financing
• Inspired Instruments Raises $1.25M, Lets You Rock Out On A Digital Guitar
• BuzzMedia Adds Music Blogs Gorilla vs Bear and PureVolume, Partners with Hype Machine, RCRD LBL, PopMatters
• AudioBoo Lands Funding, Partners, Radio Deals
• Guardian Media Group Buys UBC’s MXR, Takes Its iTunes Tagging Service

As I mention each month, this isn’t a comprehensive list and the numbers (where disclosed) have been pulled from public sources but it still gives us a sense of general investment activity in the music tech space. If I missed any deals, please don’t hesitate to comment below.

Music Services and Apps

Seven45 Studios to pump new life into music games – Looking to revive a once hot gaming category by introducing a new kind of faux guitar and a unique kind of drum set.

LimeWire Planning A Serious, Cloud-Based Comeback – A diversionary tactic or a legitimate attempt to square things up with the labels? Are they looking to capitalize on whatever brand power they may have left to launch a service that will attract paying consumers, fast? And if they do successfully relaunch, will anyone really care given all the ticks and fleas that LimeWire may never shake-off?

Sound Around – Another in the growing line-up of DIY iPhone app development targeted at bands.  Ryan at Virtualmusic.tv does a great job covering the backstory of this new music startup.

UK supermarket Tesco is preparing for to launch of a digital locker service for music and movies -  “The way it would work practically is that when you buy a disc in store or online, that title would be put up into your Digital Locker which would immediately be accessible from devices registered to that locker.”

mSpot Opens Up Freemium Cloud Music Service in a Bid to Pre-empt Apple and Google; In-Depth Q&A with CEO Daren Tsui – First 2GB are free with plans running up to 100GB per month. Only works on Android phones for now and what differentiates mSpot from other locker services is the way they are navigating around the licensing issue by not having a master copy of a song that is served out to listeners, but will keep individual copies for each user who uploads it, which they believe is in keeping within fair use laws and therefore doesn’t require any additional royalty payments.

GarageBand Online Music Community Shuts Up Shop – Being in operation for ten years, especially a digital music business, is quite the feat. Garageband spawned social music discovery service iLike, now owned by MySpace. The general consensus around the web is that the service won’t be missed very much, having lost its lustre over the past few years.

Mixlr: Share Live Music On The Web – A new platform for DJs, bands to share live music straight to the web. You can broadcast live or upload prerecorded sets.

Tastebuds.fm – This LastFM powered music dating service helps you connect with other single people who share the same love of music. Very slick interface and easy to use.

Fanit – This new service builds on the “true fan” concept. It’s built around a gaming theme where you have to take certain actions (for example: promote on social networks, buy badges with the money going directly to the artist) within a 60 days period to prove you are a true fan. If you don’t achieve this status, you start again.

Aviary Launches Music Creator – New in-browser music creation web app lets users access free and Creative Commons instruments/loops to create music and beats for commercial and non-commercial purposes.

Slacker Radio Announces iPhone, iPad and iPod touch Station Caching for Listening Everywhere – This new feature seems like a first for internet radio. I think it’s kind of cool, especially when you don’t have the time or even know what you want to listen to. Pick a station and download programmed music for offline listening.

HomePipe now streams your iTunes to Android, other files too – Another service that lets you access all your local files (music, photos, video, files) from your iPhone and now Android.

Thumbplay Releases Subscription Music For iPhone – Thumbplay, once a dominant ringtone provider, is switching gears to leverage the smartphone boom, and is placing its bets on full-track subscription music services.

Koitunes – Currently in private beta, this new music service is a Twitter overlay app which helps you discover music that your Twitter followers are posting or talking about. The service supports LastFM, Pandora, Blip, theSixtyOne, Spotify, as well as a handful more.

Buzzdeck – UK-based digital distributors AWAL launch a new real-time analytics tool designed to help enable labels and managers to better track and respond to any buzz growing for their artists or releases online.

Aupeo – Personal streaming internet radio. Based on a recommendation engine and mood station that are powered by the latest innovations from the Fraunhofer Institute, inventors of the MP3.

Opinions, Insights and Analysis

Google Needs To Decide Which Side Of The Music Industry Fence It Is On – “The labels and Google need their relationships to be as amicable and as fruitful as they can be. The experience of Apple shows that antagonizing a key channel partner just wastes energies for both parties and does little or nothing to help the competition and does nothing to help the fight against free.”

A Guide To The Cultural Battle That Is Reshaping The Media Business – “The challenge for big media companies is not just financial. They have to find a way to embrace the power of their users and change their thought process and attitude towards their customers, while not alienating the creator-centric model that currently pays the bills.”

The Music Radio Solution – “Consumers are dictating what devices they prefer, how they want to listen (in shorter segments), where (on their mobile devices) and with whom (their social networks).”

Hidden in plain view: Google Music’s stealth infrastructure – “It’s called YouTube AudioSwap, and it’s really quite clever. When you upload a video to YouTube with a music soundtrack, you can opt for your low bitrate version to be replaced by a superior quality master recording from Google’s own extensive collection of master recordings. What’s that, you ask – you’re saying that Google has an extensive collection of master recordings already? Indeed it does. Fully licensed, with publishing information.”

We Need Digital Lockers More Than Ever – “We now live in a world where we have multiple devices on which we want to consume various forms of media: TVs, desktop PCs, laptops, smartphones, tablets, eBook readers, and more coming. We need a locker. We need an open, authenticated location in the cloud where we can store, access, receive, organize, and share our digital media. Media is too fragmented online.”

Getting into the digital groove: The top five of music 2.0 – Five new digital music projects using crowd-sourcing, cool coding and collaboration to help the music industry rock out in the digital age.

C’est Lala Vie: Does A “Stream Any Song Once” Model Make Sense for Apple’s iTunes? – “And the problem with free, ad-supported streams is that ad rates simply aren’t high enough to allow the streaming services to offer reasonable payments to labels for each stream, let alone generate enough profit to support and grow the company.”

You, the D.J. Online music moves to the cloud – “The anonymous programmers who write the algorithms that control the series of songs in these streaming services may end up having a huge effect on the way that people think of musical narrative—what follows what, and who sounds best with whom. Sometimes we will be the DJs, and sometimes the machines will be, and we may be surprised by which we prefer”

Upcoming Music + Tech Events

• OpenMusicMedia NYC – New York City, NY – July 7th, 2010
• Social Media and Direct 2 Fan Music Marketing – Toronto, ON – July 7th – July 8th
• Latin Alternative Music Conference – New York City, NY – July 6th – July 10th
• Medieval and Renaissance Music Conference – London, UK – July 5th – July 8th
• Music 4.5 Goes Practical – How to use local, social and cultural content and grow globally – London, UK – July 7th, 2010
• Vinyl Music Festival – Sarisota, FL – July 15th.
• Beirut Music Conference – Beirut, Lebanon – July 14th – July 18th
• The Conclave Learning Conference for Radio Broadcasters – Minneapolis, MN – July 15th – July 17th
• The New Music Seminar – New York City, NY – July 19th – July 21st

If you have an upcoming event you want us to post in next month’s music + tech recap, please get in touch with me.

Gabriel Nijmeh is a software business analyst, passionate music lover and guitar player. He currently advises a couple of music startups, including Mediazoic, a real-time social DJ platform and co-founded the Toronto edition of OpenMusicMedia which brings people together to openly discuss the intersection of digital music, media and culture.

Google held their annual I/O developer conference over two days in May where they (and their partners) announced a number of new initiatives including Google TV, mSpot, a music streaming/syncing service for the Android and their acquisition of Simplify Media, which allows streaming of locally-stored media to Android devices.

Next up is Apple’s annual developer’s conference (WWDC) set for June 7th – June 11th. Rumours and speculation abound about whether AppleTV will receive an update to compete against GoogleTV, although comments by Steve Jobs at the All Things Digital conference seems indicates that there isn’t a viable market for setup top boxes and Apple still considers AppleTV a hobby. If you believe opposite of what Jobs is saying, Apple is probably ready to dive head first in this business.

Also, now that Lala has been shutdown as of May 31st, the big question is whether Apple is ready to launch “iTunes in the cloud” next week.For those who can’t wait to stream music here are three different options to stream to your iPhone.

Google and Apple are two key technology companies (along with many others) working on media convergence strategies (reading, watching and listening) and preparing to battle for the networked media life. There are a lot of questions and unknowns around licensing/copyrights, partnerships with content providers, consumer behaviour (are they ready? will they pay?), open vs. closed ecosystems etc that will need to be addressed and negotiated over time. Not there yet, but inching closer.

In the meantime, there are no shortage of available hardware and software options. For most media + tech geeks, we have had access and used personal media streaming technology (Subsonic, Orb, Roku, Popbox, Boxee, Plex etc) but what does it mean for the mainstream music consumer? Most people don’t have the time or patience to setup and maintain their own media servers. So maybe Apple (with Lala’s technology) and Google (with Simplify Media) in particular might make it easier to user and legitimize these services for mass market adoption. Mainstream consumers will make decisions and choices based on what the big guys do and how these products/services are developed, marketed and supported.

David Pakman in an audio interview discussing music’s next evolution made the point that music must become “part of the very fabric of the web, not merely an overlay on top of it”. When you look back in history, Sun Microsystem’s earliest slogan, first uttered by John Gage was “The Network is the Computer.” As the underlying technology advances and evolves, the concept of the cloud is really nothing new.

Which leads me to my next point and that is every year seems to be the “year of the cloud”. For those of us working with or closely following technology, we are very familiar with the term and have discussed it endlessly. Overused buzz word and clever marketing for sure but for the everyday consumer, all they want is affordable access that is fast, convenient and just works. The “cloud” won’t mean very much to them. And why should it? Isn’t terrestrial radio in the cloud? Or cable/satellite TV? I’m sure I’m not the only one to think this but it really is time to put the term “music in the cloud” to bed because what we are really talking about is access and by extension choice, whether it is digital downloads, streaming or physical (CD/Vinyl/DVD).

The future as always is exciting, innovation is fraught with failures from which the next defining consumer product always emerges.

Investments and Funding

A quieter month with only a handful of investments and news that Terra Firma secured $156 million in order to avoid a Citigroup takeover.

Total 2010 Investments as of May 31st, 2010

Q1/10: $99.6m
Q2/10 (to-date): $73m
2010 total to-date: $172.6m

• Social Radio Startup Jelli Closes $7 Million Funding Round 1
• Ticketfly Raises $3 Million
• Media Trading Service Swaptree.com Lands $6 Million
• Google Acquires Media-Sharing Technology Firm Simplify, Terms and Financials Not Disclosed
• Investors Back Music Discovery ExtensionFM Plug-in For Google Chrome, Raise $500k
• Jingle Punks Music Completes Substantial Equity Financing, Terms and Financials Not Disclosed
• AudioMicro Acquires Audioo, an online voicemail sharing service
• Spotify Community ShareMyPlaylists Has Six-Figure Funding To Go Proper

As I mention each month, this isn’t a comprehensive list and the numbers have been pulled from public sources but it still gives us a sense of general investment activity in the music tech space. If I missed any investments, please don’t hesitate to comment below.

Music Services and Apps

Incredibox – Admittedly, this is a bit of time waster but this Flash-based app lets you create your own beatboxing acapella vocal group.

Trntbl.me – Turn any Tumblr blog into a playlist. For those who don’t realize it, Tumblr is an incredible place for music discovery and personal recommendations. To see this action, take a listen to some of the 539 tracks I have posted over the past two years on my Tumblr blog.

Hitmaker is a new iPhone app with the goal of making music listeners into music influencers. The basic premise is you promote music within your social circle who then decide how good your picks are. You collect points and work your way into beoming a music mogul.

25 Music Apps for the iPad – A pretty impressive list of apps. The more I see the various demos and videos, the more I realize that an iPad will have a future in my hands.

AudioDraft gives musicians new tools for online, worldwide collaboration – Designed to let artists collaborate on a commission, sharing the financial risk of not winning the deal and sharing the prize money, if they win.

mSpot already offers a mobile movie streaming, mobile radio and are now moving into the mobile music space. We will see more of this media convergence with Google and Apple leading the charge. Naturally this makes sense.

LoKast is a “disposable” proximity based social network that utilizes bluetooth to connect people within a 300ft radius. Some bands are using it to broadcast pictures, music and other content at their shows to fans in attendance who in turn can also connect with other attendees.
According to this recent patent filing, Apple is also working on their version of an event-driven, proximity based social networking platform called ‘iGroup”.

Radioweave which is similar to Byo.fm, lets you “weave” a personal radio station filled with podcasts, music, traffic, weather, news and even your Twitter channels. Listen on the web, iPhone/iPod touch, and Android devices. Will commercial radio stations ever take this customized approach?

Play.me and Echonest Combine Forces by separating music app development (APIs) from the complexities of music licensing. This is smart and progressive thinking. Developers can focus on making the best possible music apps and yet have full access to legal and licensed music without worrying about getting sued into oblivion.

The Best of British Digital Music Startups – Musically reporting from the Brighton for The Great Escape conference, reports on a number of UK music startups including Music Glue, MusicMetric and RjDj.

Music Hack Day weekends keep getting better and better. The sheer genius and creativity is mind blowing! I spent a bit of time reviewing the hacks that came out of last month’s SF Music Hack Day and here are a few that really stuck out.

• Six Degrees of Black Sabbath – This is absolutely wild! Enter the names of two artists and follow the path that connects them. I made a path from Death Cab for Cutie to The Smiths. Interesting results.
• Overhere – Love your friends music taste? Type in your friends LastFM account name and using Spotify listen along in (near) real-time.
• Bragging Rights – “A very hasty morning hack designed to answer the one question on every music hipster’s mind: Who heard it first?” Come on, who hasn’t at least once got into a “discussion” with a friend over who discovered what first?
• The Swinger makes any song swing. It does this be taking each beat and time-stretches the first half of each beat while time-shrinking the second half. Take a listen to a few different songs including Guns N’ Roses, Metallica and the Police. Try it out here.
• (My) Bands in (Your) Town – A widget you can post on your blog that lets your vistors know which bands you like (via LastFM) are playing in their town (via Bandsintown).

You can see a list of all the SF hacks here. More live Music Hack Day reports can be found here, here and here.

Playdio – A clever way to use digital music services like Spotify to include full length and licensed music in a podcast.

Gigswiz – A startup from Helsinki, Finland that just launched an analytics platform for the live music industry. This service helps bands, agents and local promoters make better decisions about where bands should schedule their concerts and tours.

BlueBeat is back with an iPhone app that lets you play from a variety of playlists which they claim are “fully-licensed simulated performances”. Don’t really know what that means. But if you recall, a court injunction last year forced them to shut down their questionable download service that the claimed was legal because they use “psychoacoustic simulations“.

Opinions, Insights and Analysis

As Consumers Steer Clear of Mobile Music Downloads, iTunes Continues to Run the Show – Will consumers have to wait a bit longer while Apple gets all their music streaming ducks in a row (labels, consumer culture and infrastructure)?

Face It – In Music, Devaluation Is The New Reality – Over and above royalties which are deservedly earned by artists, the physical aspect of CDs has overpriced music for many years, very little of which artists ever received. Technology comes along and throws everyone a nasty curveball and artists take the brunt of it. The suits, with their army of lawyers and MBAs will always find new ways of making money while artists are left to fend for themselves in the new music economy. Music, as an art form is not devalued, the old music business model is. A perfect segue to the next article… which is probably very true.

Effects Of The Internet: Cashing In On The Digital Economy – “In a digital economy, big business still loses millions, while the independent musician has nothing but gains.”

The Myth Of “Distribution Is King” – Content is still king! People don’t buy distribution, they buy content.

A Record Collection Of Links: Collecting In The Age Of Streaming Music – “In the age of streaming music, the way one builds a music collection, the looks of it and the way it is maintained differs from the collection as we used to know it. But is the intimate relationship between collector and collection disappearing in the age of streaming music?” Full 30 page essay can be found here.

SF MusicTech Summit which was held in San Francisco on May 17th continues to grow in prominence and importance. Take a look at a some of these post-event reports here and here”.

Everybody is a Music Maker – Dave Haynes of SoundCloud and OpenMusicMedia presented at TEDxCardiff last month where he discussed how we are becoming more than music consumers thanks to the development of music creation/participation tools. Very insightful.

Hypebot has an informative four part interview with Greg Kot who is the author of Ripped: How the Wired Generation Revolutionized Music.

Upcoming Music + Tech Events

• OpenMusicMedia Belfast – Belfast, Ireland, June 2nd, 2010
• MUSEXPO Europe – London, UK, June 14th – 15th, 2010
• Music and Advertising – New York City, NY – June 15th – 16th, 2010
• NXNE Music, Film and Interactive – Toronto, ON, June 14th – 20th, 2010
• Copyright and Technology Conference 2010 – New York City, NY, June 17th, 2010
• 7th Annual Digital Music Conference – Washington, DC – June 25th, 2010

If you have an upcoming event you want us to post in next month’s music + tech recap, please get in touch with me on Twitter.

Gabriel Nijmeh is a software business analyst, passionate music lover and guitar player. He currently advises a couple of music startups, including Mediazoic, a real-time social DJ platform and co-founded the Toronto edition of OpenMusicMedia which brings people together to openly discuss the intersection of digital music, media and culture.

Digital music services - big updates to Spotify, Lala, and more.

There certainly was a lot of news and announcements in April even though it seemed to me that things got off to a slow start. Ultimately it turned into a Spring awakening as the month rolled on that it became a challenge to keep up with the avalanche of news, stories and announcements.

Some of the bigger stories? Facebook announces their new Open Graph protocol with Pandora as one of the first companies to partner with Facebook. It’s a start but will FB ever make music a spotlight of their service or do they consider music like any other social activity that makes up just another part of your life?

Spotify releases the first significant update in awhile with a heavy focus on sharing and social networking while Lala is finally being shuttered by Apple on May 31st.

Let the Apple game of speculation begin: iTunes in the cloud? Nope not anytime soon because Apple has something even bigger brewing and it has nothing to do with a streaming music service but maybe, just maybe given the timing of Lala’s shutdown, Apple will launch a music subscription service as early June? My guess is Apple will take it slow because of concerns from the labels and they will milk the a la carte market for as long as possible. Apple, as well, does a good job conditioning their users and fan boys so whatever they ultimately release will be carefully planned to stir maximum hype and ensure maximized revenue. I’m not really convinced that Apple cares much for the social aspects of music, seeing it more of a nuisance to achieving their media domination plans.

Let’s jump right in and see what April had for us to think, discuss and debate.

Investments and Funding

April was a very strong month for investment activity. A couple of notes: I have included some hardware/networking related investments which have a music component to them and as per my usual disclaimer, this isn’t a comprehensive list and the numbers have been pulled from public sources but it still gives us a sense of general investment activity in the music tech space. If I missed any investments, please don’t hesitate to comment below.

Total 2010 Investments as of May 10th, 2010

Q1/10: $99.6m

Q2/10 (to-date): $58.72m

2010 total to-date: $158.32m

• Zenverge, Fabless Semiconductor Company Building Digital Media Solutions for Content Storage, Playback, Mobility and Networking Closes $30 Million Series C Financing
• MXP4, the Leading Interactive Music Technology Platform, Closes $4 Million Investment to Accelerate the MXP4 Everywhere Strategy
• News Corp. raises bet on digital music as part of $10m series B investment in Beyond Oblivion
• Stitcher Secures $6 Million in Series B Venture Funding to Help Transform the Way We Listen to Talk Radio
• MusicMatic buys Mangrove’s share in Jamendo, intends to raise more funds
• Thumbplay, provider of mobile entertainment including music, videos and games raises $2.5m in funding
• Nimbit, provider of career management solutions for independent artists and labels receives $2.56m in new, unattributed funding.
• Yangaroo, a B2B digital delivery solution provider for music and advertising industries received $666k in Debt funding
• FameCast, an artist discovery engine received $2.71M in unattributed funding.
• Sleek Audio, raises $285k in debt financing

A couple of interesting funding articles you might find interesting…

• Help Fund Music Technology Startups via Musicians for Music 2.0
• Good News: There’s A Little More Funding Floating Around…

Music Services and Apps

Bandsintown a concert ticket aggregator, event recommendation and notification platform announced an API partnership up with Shazam, EMI and Reverbnation which will now expose concert date to 50 million people via these partner networks. I love that I can integrate my LastFM account (or Pandaro) with Bandsintown where they will track and notify me when my favourite bands are playing in town.

Senzoo.me – A simple and customizable fan-funding widget that encourages fans/consumers to pay back value creators like artists, developers, educators and musicians. Compared to similar platforms like Flattr and PaySwarm, Senzoo is extremely lightweight and does not require any technical skills to implement. Integrates with major blogging platforms (WordPress, Typepad, Drupal etc) and payments are handled through well established payment gateways like PayPal, Google Checkout and Amazon Flex Payment Services.

Beyond Oblivion – As mentioned above, this startup just received $10m in funding and is looking at an October 2010 launch date. What are they planning on doing? Well, in hyperbolic style, they plan to… “combine the stickiness of a social network with unlimited life-of-device access to the largest music library on Earth, within a vast ecosystem where content owners are paid per-play no matter if the original music file was ripped, bootlegged or legally or illegally downloaded.”

Indaba Music releases Mantis, a web-based Digital Audio Workstation (DAW) enabling anyone, from anywhere in the world, to record, edit and mix high-quality audio.

Headliner.FM – I really like this concept. Headliner is a social media cross promotion exchange that connects bands and artists to new fans. Fans will be more open to receiving recommendations from their favourite band to other similar/complementary artists. A great way for bands to leverage existing and well-connected networks and to share fan bases.

Mixtape for You – Based on Andrew Dubber’s “I Made You a Tape” idea, this new web service lets you create mixtape MP3s. Very simple site and limited in features, it’s a throwback to those days where you deliberated carefully to create the perfect mixtapes on cassette tapes for your friends, girl/boyfriend, spouse etc. My wife still has three or four mixtapes I put together many years ago which she still relishes today and I have a few hanging around in a box somewhere that I received from friends.

Songr – Another day, another music mash-up. Like a Digg for music, users submit song title/artist they are listening to and visitors to the site can bump a song up or down. The sites uses the YouTube API to pull the song in to listen/view the video.

AirKast – Digital content delivery platform and mobile app framework used by radio, television broadcasters and content publishers to distribute multimedia-rich content to mobile and connected consumer electronics devices.

WaTunes Launches Music Store Application on Facebook Platform – Pretty good launch timing in light of the Pandora and Spotify integration with Facebook. If users are already spending a lot of time on Facebook, they don’t need to leave the site to buy music (using Facebook currency perhaps?) that they may already be sharing and discussing with their Facebook friends.

Music related startups in Ireland – Naturally with such a focus on US startups, it’s a good reminder that there is a lot of digital music startup activity happening beyond our shores. Some of these Irish startups in this list are doing some pretty cool things.

Rhapsody Adds Offline Listening To Its iPhone App – Rhapsody is giving its iPhone app some bragging rights with an update that lets subscribers listen to tracks even when they’re not online. Users will now be able to download their Rhapsody playlists to their phones and by June, Rhapsody says it will add functionality so users can download individual songs and albums as well.

Amsterdam Music Hack Day – A weekend that brings together 150 of the best music and tech geeks produces a huge array of next-gen music apps. A list of all the hacks can be found here.

How Tech is Changing the Tone of Music as We Know it – A look at four different technologies looking to change the music landscape. Hypersonic sound is really fascinating. Sound is passed through a tightly focused beam that you can only hear when the beam is pointed directly at you.

Glee fans, grab the new iPhone karaoke app and annoy your friends.

Stereomood, an emotion based Internet radio station just released a new developer API.

LastFM is in the news again having dropped their on-demand streaming, and putting a renewed focus on scrobbling and personalized internet radio. Shortly after that announcement, they introduced a new program “Play direct from artist” that lets artists post full tracks for streaming.

Opinions, Insights and Analysis

Plugged/Unplugged: How Facebook Will Change Digital Music – “Facebook already has trained more than 400 million users in how these functions work within the Facebook confines. Applying them to the broader Internet holds significant implications for the music industry. For instance, it’s no secret that music recommendation and discovery is considered the greatest digital music opportunity. More music is being created that ever before, and the digital music services that can best introduce users to the new music best suited for them in the most seamless way possible will benefit not only the music service, but the artists and labels trying desperately to reach new fans.”

Digital Music Startups: Sexy, but Smart? – Insights from Adam Wexler, a young entrepreneur building out his startup Go Rank’em. Key point in this blog post is an interesting stat by David Pakman who says that only 5 out of 109 digital music startups have led to positive returns for investors.

A Billion Taco Vending Machines = Bigger Taco Industry – “Some in the music industry may question the economic impact of cloud music, but I think it’s a great opportunity to turn every device into a vending machine. Music is such a spur-of-the-moment emotional experience that if people hear a song and can get it with one click they will (if it’s easy). If every phone is a vending machine that’s a few billion more retail outlets to take the place of the vanishing record stores,”

Black Eyed Peas Will.i.am commenting at Twitter’s Chirp Conference – “The band of the future is not going to be a singer, a guitarist and a bass player. It will be a singer, a guitarist, a bass player and a code writer – the guy who does apps, computer animation. That is a group. It is going to be about self-contained content-providers.” I’m not a fan of Black Eyed Peas but his comment is rather insightful and on the money. It’s also the same sentiment I’ve heard from a few indie artists I know.

Research: Music recommendation is *the* big opportunity – “Word of mouth recommendations from friends and family is the most powerful way of driving purchases.” Lefsetz has been writing and talking about filtering as being the next big thing.

Anatomy of a band website – Lots be honest, most band/artist websites leave a lot to be desired. Most are static, brochure-type sites that don’t engage fans and/or nurture an active and vibrant community that demands repeated frequency visits. Which bands do you think are effectively using their websites? Nine Inch Nails comes to mind. Others?

Spotting the Creators of Peer Influence – “People make over 500 billion impressions on each other about products and services every year.” In a trust-based economy, consumers are influenced by their peers, friends and family. Personal influence is the new advertising? How will this play out for artists? And how does it tie into the music filtering and personal recommendation process?

Excellent RAIN Internet Radio Summit coverage from the NAB conference in Las Vegas. A lot of insights on internet radio and mobile apps. A recommended read.

Witnessing The Atomization of Artistic Culture. – “The internet gives us far more choice than the limits imposed upon us by broadcast media. We know of more bands, we can get tour dates pushed to us, can sample music long before it is released and we can reserve tickets well before the show. But we are doing this across many more artists, spreading our limited disposable income around in ways we didn’t when we had fewer choices. Nevermind that we are offered billions of other entertainment choices from video games, YouTube, Facebook games and even Crowdreel and Bitly.TV.”

A decade of digital: 10 things for 2010 – “Digital is not a channel. It’s a suite of platforms, channels and tactics that will, ultimately subsume its parents entirely. Digital marketing is not simply a new place to disperse persuasive symbols, but the emergence of any entirely new behavioural grammar, as companies and their customer begin to engage with each other in entirely new ways in entirely new spaces, where everyone has an equal voice.”

Upcoming Events

• Digital Music LA – Los Angeles, CA, May 11th, 2010
• OpenMusicMedia Toronto – Toronto, ON, May 12th, 2010
• San Francisco Music Hack Day – San Francisco, CA, May 15th and 16th, 2010
• NARM Convention – Chicago, IL May 15th to May 17th, 2010
• SF MusicTech Summit – San Francisco, CA – May 17th, 2010
• Future of Music Coalition Presents D.C. Policy Day – Washington, DC – May 25th, 2010
• Open Music Media Montreal – Montreal, QC – May 25th, 2010
• transmitCHINA Conference – Shanghai, China, June 2nd to 4th, 2010

We spend a lot of time with our faces buried in our computers so let me end this recap by saying get out there and support live music! The best technology we have is our ears, our hearts and the magic created by artists and their instruments!

See you next month.

Gabriel Nijmeh is a software business analyst, passionate music lover and guitar player. He currently advises a couple of music startups, including Mediazoic, a real-time social DJ platform and co-founded the Toronto edition of OpenMusicMedia which brings people together to openly discuss the intersection of digital music, media and culture.

Nice to see winter hand over the reigns to spring. Mind you, winter here in Toronto was mild, some might even say non-existent. It is even nicer to see people trading their hats, mitts and down-stuffed jackets for sunglasses, short sleeves and beers on the patio. Along with spring renewal comes a slew of new album releases, concert announcements, music conferences and meet-ups.

I had a chance to attend Canadian Music Week mid-month which I wrote about here. I found it quite interesting and fascinating to sit in on a variety of executive level music panels to hear ideas & opinions being vigorously discussed which is quite different from reading blog posts and news releases. I think generally there is more optimism than you would expect but it’s also because more people are coming to realize that time, energy and resources are being misspent in ways that haven’t proven productive and never will.

Clay Shirky in his latest think piece, “The Collapse of Complex Business Models” fittingly describes what happens when stress hits complex societies and/or industries as they become far too inflexible to respond. It’s not that they don’t want to change, it’s because they can’t. There is more than enough historical precedence that shows countries, empires and industries who, after years of domination and success, find themselves quickly unraveling and never able to maintain their former glory.

He ends his piece by describing what happens to institutions when they collapse. If we consider the music industry today which is facing monumental technological, economic and cultural shifts, the battle raging between the old system as it fights to preserve the status quo and the people who have broken away from the industry is a clear indication that we are in the very early stages of an industry refresh.

When ecosystems change and inflexible institutions collapse, their members disperse, abandoning old beliefs, trying new things, making their living in different ways than they used to. It’s easy to see the ways in which collapse to simplicity wrecks the glories of old. But there is one compensating advantage for the people who escape the old system: when the ecosystem stops rewarding complexity, it is the people who figure out how to work simply in the present, rather than the people who mastered the complexities of the past, who get to say what happens in the future.

We have the likes of Apple, Pandora, Spotify and hundreds of other music startups, artists, even new music labels/companies, who are shaking things up by building new business realities. For any student of history and economics, this is very interesting to witness firsthand.

Investments and Funding

March was a quieter month with much less investment activity compared to January and February. Q1 2010 closes with an approximate investment amount of $99.6m. As I have noted in past recaps, this isn’t a comprehensive list and the numbers have been pulled from public sources but it still gives us a sense of general investment activity in the music tech space. If I missed any investments, please don’t hesitate to comment below.

• Sonos Confirms $25 Million Investment From Index Ventures
• Beamz, maker of interactive music products, raises $2.48m
• The Echo Nest Gets $500,000 Grant From National Science Foundation
• Regen manufacturer of solar-powered audio products, raises $1.6m in funding

Billboard has been tracking the hottest music-based startups, which have predominately been music service based companies, meaning pretty much anything but streaming or download services. Billboard has tracked 136 deals in 2008 and 2009, with 49 deals involving 45 companies that provide music services. 36 deals amounted to $417.5 million with $101m of that being VC based. Very interesting stats!

Music Services and Apps

Rootmusic- This is a slick little music add-on for artists who want to build a MySpace-like band page in Facebook. It lets fans listen to streaming music (using a Soundcloud player), view tour dates, photos and read a band’s bio. Rootmusic joins a list of other Facebook band apps like LP33 and My Band.

Immitter – A new music delivery service that is aiming to help unsigned, indie bands get heard. Bands can enter details/keywords specific to their music (genre, location, BPM) which helps users to discover new music, Pandora-style (as some are describing it). To be really effective as a music discovery tool, this service is going to need a massive infusion of artists to make it worthwhile for fans.

Project Playlist Seeking More Funding, In Talks with AOL- $23m in funding so far, legal troubles with two out of four music labels and the company is looking for more money? Tough pitch. I didn’t know that Owen Van Natta, former Facebook exec and former CEO of MySpace was CEO of this startup. He wasn’t there long enough (5 months) for anyone to really notice?

IMHO is a new music, video, radio and TV cloud-based multimedia service and reading the press release makes your head spin. Bleeding-edge? Watershed moment? Next generation? I gave it a spin and IMHO, it’s not very good. The service is slow, cluttered, not very user-friendly and tries to shove too much in a tiny widget.

CBS hopes for Last.fm profit in 2010 – It took me a while but once I really gave the service a chance, Last.fmhas become my go-to music service. They linger in the shadow of Spotify, Pandora and MOG and claim that subscriptions make up 25% of their revenue. It certainly helps having the muscle of CBS behind them, because Last.fm may not have survived independently. I’m definitely cheering them on. Check out my music Last.fm profile hereand lets connect! In other related Last.fm news, they have just published their long-awaited API update. It will be interesting to see what kind of new and updates apps developers might start working on.

Q+A with Claes Loberg, CEO of Australian music service Guvera- With Guvera’s US beta launch on March 30th, this is an interesting interview that provides deeper insights into this new ad-support music download service.

Muziic for iPhone- The desktop version of this music service is now available for iPhone/iPod Touch letting you search for music and videos on YouTube, tune in to hundreds of internet radio stations, build a playlist or browse featured tracks and albums.

Ultimate Guitar Mobile App- My favorite guitar tabs site now has an iPhone app! It is currently the number one paid app and a top fifty overall app in iTunes.

Snowtape- Do you remember the days sitting beside your cassette machine that was hooked up to your radio, waiting to record your favorite top 40 hits of the day? Well, here’s another internet radio player app but more interestingly lets you record individual tracks from the radio stream. Given the amount of music that can be downloaded (legally or otherwise) or accessed, not really sure why anyone would spend much time recording streams on the run. This experience will never compare to the early days of home taping.

Venue.FM- A web mash-up with a simple and clean interface powered by Songkick. Pick your city and pick a period (limited to current day, next 7 days or next 30 days) and a list of concerts is presented to you. Beyond the usual information (date, venue, location), a batch of songs from each touring artist is available for you to listen.

BYO.FM – Michael Robertson (of MP3.com and MP3tunes.com) is at it again with his latest idea that lets people program their own radio station with news, weather, traffic sports and music. CNET provides a good description of the service. I gave it a try and I really like the overall concept and I believe this is an idea that commercial radio should explore further.

Mflow- Another music recommendation platform that follows a Twitter approach. Music fans follow each other, recommend music along with a tweet size comment, each recommended song allows for a full first time listen and subsequents listen are 30 second clips (similar to Lala). When someone buys a track you recommend, you get 20% of the purchase price. This is similar in concept to Blip.FMbut mFlow has partnered with a number of music labels and is focused on getting people to buy music. Currently in beta and only available in the UK.

Universal Music Group has just released their version of Guitar Hero/Rock Band/Tap Tap Revenge called Six String. Includes six songs, they offer twenty additional tracks available for in-app purchase.  I gave it a try and it is a very well designed app, the first to be released directly by a major label.

MOG showcases iPhone and Android apps- Expected to be released in Q2, will allow users to download tracks for offline listening, which is something Spotify currently offers in their iPhone app.

Song.ly, Twitter Music Sharing Service Up for Grabs for $50,000 – A much simpler, no-frills version of Blip.FM, Song.ly is a service that lets you search for and share songs on Twitter. It appears that someone has put in a bid for $50k, although I am wondering if the bid is legit and whether a deal will go through.

Interview: Zach Zalon On Hello Music’s Opportunity Engine For D.I.Y. Musicians – Hello Music combines technology with professional A&R to identify artists and connect them with career opportunities. This type of music service proves that technology is only a part of overall effort in building a music career.

22 students + 10 days + Echo Nest = 7 mobile apps!- A group of mobile development students at Olin college just completed the mid-semester #mobdev contest. 10 days to create a compelling product prototype on the Android platform using the Echo Nest APIs.

Opinions, Insights and Analysis

Music 4.5was held in London on March 4th, that brought together tech start-ups, serial entrepreneurs, investors, artists, band managers and key industry players to talk, strategize, and debate the direction of the music industry. Musically has provided great insights into the panels and discussions that went on:

• The communications gap between music and tech companies
• A lot of music services, but where are the businesses
• 10 music startups pitch their wares
• Music startups pitch to teenagers

Dave Kusek on The Cloud, Topspin, Hype Machine, SoundCloud, and the death of MySpace – “Great music is more important than anything else”. True. Very true!

The Human Recommendation Engine – Algorithms have come a long way in automating music recommendation and discovery, but nothing will ever beat talking to a passionate friend or trusted source about new bands and new releases. It’s about the conversation and slowing life down a bit so we can actually enjoy and connect with the music in more than a drive-by fashion.

The Truth About What We’re Paying For Content- People love to debate the merits of free vs. paid content. But overlooked in all this is the cost of access to that content, that’s where the action is. We’re paying more than we ever have to receive our movies, news and music, according to Forrester analyst James McQuivey.

5 Reasons I’m Still Not Paying for a Music Subscription Service – Hard for most people to justify paying for something when so much of it is already available online and which will remain that way. I do always wonder had the labels initially came together to combine their catalogs and hired the best music technologists to build a solid, user-friendly application, would the story be different? Would they have got it right? Can it even be done today?

How Important is Gaming to the Music Industry? – According to a games developer, “Industry insiders are learning that video games are the radio and distribution channel of the 21st century”. I don’t agree that gaming is a primary music distribution channel because how many people buy games because they want to hear the music first? Music is an add-on that enhances game play.

Upcoming Events

• Replay: Symposium on Sound Sampling – Syracuse, NY, April 9th, 2010
• NAB Show- Las Vegas, NV, April 10th to April 15th, 2010
• Envisioning 21st Century Music Business Models- Berklee College of Music, Boston, MA – April 15th, 2010
• ASCAP “I Create Music” Expo – Los Angeles, CA – April 22nd to April 24th, 2010
• Music Hackday- Amsterdamn, Netherlands, April 24th to April 25th
• Musexpo 2010 – Hollywood, CA – April 25th to April 28th, 2010
• NARM – Music Business Convention – Chicago, IL – May 15th to May 17th, 2010

Gabriel Nijmeh is a software business analyst, passionate music lover and guitar player. He currently advises a couple of music startups, including Mediazoic, a real-time social DJ platform and co-founded the Toronto edition of OpenMusicMedia which brings people together to openly discuss the intersection of digital music, media and culture.

The east coast edition of Digital Music Forum played out in New York on February 24th and 25th. Digital Music News did a great job capturing some of the key points raised in the various talks. Here a few of the interesting discussions and if you want to check out the rest, follow this link.

• Live@DMF: Ted’s Locker Room Speech: ‘Enough Already’ – “Enough reminiscing, old music business is not coming back, “the old days of the music business are over.”
• Live@DMF: There’s a Mobile Music App for That – “The ability to go across platforms and devices… is an inescapable responsibility of the so-called web app developer.”
• Live@DMF: The Umbrella ‘State of the Union’ – “You’re going to see a shift in the power structure, and it’s going to be ugly… the companies that adapt, open up and let people in… the ones that don’t do that will get squashed”
• Live@DMF: The Game of Music Gaming Is Changing – “Major console, mobile, social-based (and virtual) games are leading segments for music.”

Investments and Funding

Investments in music and audio related technology companies continues to be fairly strong in February with another ~$26m in investments. For those keeping a tally, in the first two months of 2010, we have seen total investments of approximately $70m. Please keep in mind this isn’t a comprehensive list and the numbers have been pulled from public sources but it still gives us a pretty good sense of general investment activity in the music tech space. If you know of others, please share them in the comments section below.

Here are some start-ups that received funding in February:

• Music Mastermind raises first round $4.9M for virtual music creation
• LinkoTec Gets $1.5 Million For Web-Based ‘Media Manager
• Social Music Player TuneWiki Raises $7m From NTT Docomo
• Spotify Reportedly Raises New Funding From Founders Fund For U.S. Expansion
• Tunesat Raises $975,000 For TV Music Tracking
• Online Music Service Mog Raises $9.5M; UK Expansion Planned
• Slacker Gets $2.0M In Debt Funding

I should also note a couple more companies that received funding in January which I missed reporting:

• Pioneers of the Inevitable (developers of Songbird) received $2.02M in Unattributed funding.
• Instinctiv (iTunes plug-in) received $400k in Unattributed funding

Music Services and Apps

Twones just released The Music Bar which is a Firefox add-on that gives you a set of tools to bookmark, manage, share, discover and search for music.

Extension.FM is a very cool Google Chrome extension that makes it easy to listen to any music embedded on a web page. Once installed, click on the button and a playlist is created which you can listen to within the embedded music player. Amazingly, you can navigate away from the page and the music keeps playing. A couple of other great features is the ability to scrobble to LastFM and as you visit different sites, Extension.FM builds a library of music for you that you can revisit anytime. Of course, no music is downloaded or stored on your computer. Here is a quick 2 minute intro video that describes this tool. If you haven’t switched over to Chrome, this might make it worth it. Ever since moving away from Firefox for performance reasons, the number of amazing Chrome extensions being developed keeps growing.

Bitspace Launches HTML5-Based Streaming Music Player and Backup Service – “There is no dearth of streaming music services on the web today, so it takes quite a bit for a new service to stand out from other popular services like Spotify, MOG and Lala. Today, we came across Bitspace, an online music player and backup service for your music files that puts an interesting new spin on this subject. This service stands out because of its great design and the fact that it’s fully based on HTML5.”

RealNetworks, MTV to Spin-off Rhapsody Music Service – The thinking here is that both companies get to move the money-losing music service off their books, and the new structure may theoretically give them a better chance of finding a buyer.

Bankrupt, Crowd-Funded SellaBand Acquired by German Investors – Reading a few blog posts and comments, it doesn’t sound like many people were all that surprised. Sellaband’s crowdsourced music-financing experiment seemed promising, and in its three-plus years, it attracted thousands of artists and financed dozens of CD and download releases, so it wasn’t a total failure. However, the company also admits that the company’s bankruptcy resulted from a combination of old-school record industry ways and new-school misplaced optimism.

Rejected By Apple, Grooveshark Releases App For Jailbroken iPhones On Cydia – Having lost patience with Apple’s app approval process, Grooveshark has gone ahead and released their app for jailbroken iPhone/iPod Touches. This is a ballsy move and probably one that won’t sit well with Apple and the labels. Either this move goes quietly into the night or Grooveshark has just given their detractors more ammunition to go after them.

theBizmo launches Hit Or Not Facebook music app – This new facebook app is similar in concept to the original The Next Big Sound when they first launched. In this game, you play the role of an A&R person and test your hit making skills. I spent a bit of time playing around with Hit or Not and it’s kind of fun to play and even slightly addictive as you try to find those hidden gems in hopes of turning them into “big stars” and making yourself rich.

SeeqPod Founder Resurfaces with Mimvi Music Aggregator – “Mimvi, currently in private alpha, will use a similar approach to that of SeeqPod — which claimed 50 million unique monthly users at one point — to grab videos from Brightcove, Crackle, DailyMotion, MTV, Pitchfork TV, Veoh, Vevo, Vimeo, and YouTube, mashing their metadata against what its web crawlers determine about a given song’s popularity and associations. In addition, it reacts to how people use it.”

RadioDNS – I’m still a big fan of radio, mostly internet radio now so it excites me to see a project like RadioDNS. This collaborative project wants to converge radio broadcasting and IP-delivered services. I see it as taking a tried and tried technology (terrestrial radio) and harnessing today’s internet technology to turn radio in a multi-platform medium. The write-up is a bit technical but this four minute video should give you enough background information. It’s worth reading Jerry Del Colliano’s new media predictions to get his perspective on the future of radio. I believe there is some tie-in’s between what he is saying and what RadioDNS is attempting to do. We’ll see whether RadioDNS is adopted in any significant way or will it be another noble attempt that is overlooked or worse, dismissed outright without serious consideration.

Micropayments has been getting a lot more attention recently with the launch of PaySwarm and Flattr. PaySwarm is open source and allows artists/writers that create digital content to distribute it through the Web and receive payment directly from their fans and customers. Flattr, started by a co-founder of Pirate Bay, will let consumers divvy up money to the musicians, bloggers, photographers, or other publisher of their choice. Will these new payment platforms gain traction? Will consumers trust them? I also wonder how labels, managers and others in the music business chain feel if bands start receiving these micropayments, effectively cutting them out of the action. There is going to be a lot nit picky things that need to be carefully addressed in order to make this a sustainable payment model. Don’t forget, PayPal already offers micropayments and have the infrastructure and experience to expand this service if we see any significant adoption.

Opinions, Insights and Analysis

The hype is in the cloud, but the reality is hybrid – “The cloud-based solutions, specifically DaaS (Data as a Service) have to be available with the “hybrid cloud” option. Hybrid cloud solutions give you ubiquitous access to your data , locally as well as in the cloud. In does not matter where are you accessing the files — they can be locally available in your LAN or on your own computer; or they could be accessible in the cloud. A hybrid cloud solution seamlessly keeps both local and cloud files synchronized.”

Rent vs. Own: The Streaming Music Debate Continues – Is this really worth debating anymore? Some people will be quick to adopt streaming services, some will want to buy, whether it is digital or physical and then other will happily access music in multiple ways. As mentioned in the above article, realistically, it won’t be an either/or choice, consumers will just have more ways to consume music.

Sony Music chief foresees the endgame for CDs – “While 60% of Sony’s music business is now made up of CD sales, Hesse saw CDs as accounting for only 20% of the business by 2013. The rest will be made up of musical ringtones, subscriptions, and downloads, either paid for by consumers or supported by ad sponsors.”

Google’s Music Strategy: Past, Present and Future- I’m not sure that Google will unseat Apple anytime soon when it comes to music, although some of the music labels probably wouldn’t mind a new partner. If Google treats music as an after-thought, rabid music consumers will know it. But I suspect they are serious, given that they supposedly lost out on buying Lala and now the rumour is they are looking at buying Catch Media. Love or hate iTunes and the iPod, Apple has captured the minds (and pockets) of music consumers and will work hard to keep them. I’m looking forward to the competition between these heavyweights and I know that there are one or two start-ups lurking in the background that will one day become a music heavyweight themselves.

New free music sites, Guevara and Free All Music learn from others’ mistakes – My initial reaction is “why are they trying this again?”. I don’t know if this “tweaked” model will finally find success but it’s better that we cheer for their success for the sake of music and technology. More success equals more confidence by consumers, investors, artists, labels, advertisers that new music business models can work. It may not be a service that some of us will care about but if they find the right audience, hopefully they make it work.

5 Mantras For The New Music Business – So the big labels are trying to preserve past, successful business models, mainly the CD release complex and yet want to wholeheartedly embrace new digital strategies? Not sure you can have it both ways given the massive shifts in technology and digital music consumption. The question now being asked is whether content owners should accept lower average revenue per user (ARPU)? Here is a great piece by Kyle Bylin where he writes about MusicDNA and whether it has a chance to catch on. In this piece he describes very well the record industry’s structured top-down, highly centralized “push” marketing model and how “the push mentality of the record industry could not be extended into the digital realm, because all three of these institutions — that they built themselves on the back of — deteriorated in the face of the societal and technological shifts that the Internet brought forth”.

The Challenge for the Music Business – “The tried and true methods of creating success in the music industry are over and are never coming back. The economics just don’t work for most acts anymore. The greatest risk in the next 5-10 years for music is that no one will want to fund the development and promotion of new musical acts the way the major labels did in the past, until we see a new financial model.”

Upcoming Music Conferences and Events

• Music 4.5 – London UK, March 4th, 2010
• Billboard Music and Money Symposium – New York City, March 4th, 2010
• Canadian Music Week – Toronto, Ontario, March 10th to March 14th, 2010
• Digital Strategies Conference – Toronto, Ontario, March 10th, 2010 (Part of Canadian Music Week)
• 2010 Media Summit – New York City, March 10th to March 11th, 2010
• SXSW – Austin, Texas, March 12th to March 21st, 2010

I’m planning to attend Canadian Music Week, and particularly looking forward to the Digital Music and Media Summit and Digital Strategies Conference. For those attending SXSW, be safe and pace yourselves. Before heading off, it might be a good idea to check out this SXSW survival guide to help get you through those long, action packed days.

See you next month!

Gabriel Nijmeh is a software business analyst, passionate music lover and guitar player. He currently advises a couple of music startups, including Mediazoic, a real-time social DJ platform and co-founded the Toronto edition of OpenMusicMedia which brings people together to openly discuss the intersection of digital music, media and culture.

2010 got off to a quick start with CES in early January, another Apple love fest and Midem 2010, the annual music biz conference held in Cannes, France. Although it was reported that attendance at Midem was down from previous years, there was still a lot of interesting panels, news and announcements made over the five days. Definitely no shortage of ideas, opinions or stories. The Midem organizers have done a great job putting together a comprehensive roundup. 34 blog posts and 29 videos covering branding, marketing, technology, publishing, business models and much more. I’ve pulled out a few of the interesting ones that I enjoyed reading/watching:

• Labels and Digital Services panel, with Spotify, we7, The Orchard, WMG, Sony and Beggars
• Mobile Apps & Music panel
• Mark Mulligan: Music Industry Meltdown: Recasting the Mold
• Albin Serviant: Is The Future of Music…the Album (App)?
• Live Post: Who Owns the Consumer?
• “Don’t stand in the way of technology, and in the way of what the customer wants”, a conversation with Getty Images and Sulake

Investments and Funding

If the numbers are accurate, there’s some pretty big dollars ($42M) being thrown around in early 2010. Compared to January 2009 numbers noted in the 2009 investment summary that Duncan Freeman of Bandmetrics put together, January 2010 alone matches Q1 2009 investments. Keeping in mind this isn’t a comprehensive list and the numbers have been pulled from public sources, it still gives us a pretty good sense of general investment activity in the music tech space. If you know of others, please share them in the comments section below.

Here are some start-ups that closed funding in January:

• The Echo Nest, Developer of “Music Brain,” Taps VCs for $1.3M
• Jelli, a user-controlled radio startup raises $2M
• Avnera raises $10M for audio chips with coolest sound
• Guvera raises another $20m for it’s ad-supported music service
• Avega gets louder with $2.5M for home audio networking
• Hello Music raises $4M to identify talent and power musicians’ careers
• Music discovery Web site OurStage raises about $2.55 million in new funding

2010 could be busy year for digital music mergers – Apple, MySpace Music, Amazon, Google, Microsoft are all up to something or another. Consolidation might be good if it stabilizes a very shaky and fragmented digital music market. So, which music firms will get bought in 2010?

Music Services and Apps

A summary of the 15 digital music startups that presented at MidemNet Labs – The full list of startups: Aviary, Awdio, BandCentral, Band Metrics, Digiclef, GoMix, KickStart, Pops, Radionomy, Silence Media, Songkick, StreamJam, Thesixtyone, Tracks & Fields, TuneWiki.

Music Hack Day Sweden was the fifth instalment of this really cool music hacking weekend. Described best by the organizers: “The main goal of Music Hack Day is to explore and build the next generation of music applications. It’s a full weekend of hacking in which participants will conceptualize, create and present their projects. Music + software + hardware + art + the web. Anything goes as long as it’s music related.”

A lot of the hacks are very raw and may not go beyond the initial concept/prototype stage. There were a few impressive hacks that you would think were fully developed web apps. I watched a bit of the stream and have been reading some of the post hackday blog posts and testing some of the hacks. I may have missed it, but I was surprised that I didn’t see any apps utilizing the Playdar service which I’ve raved on about in my October and December recaps. Here are a few apps that stood out for me:

• HacKey – Run your LastFM profile and tapping into the Echonest API, it will tell you which key you most favour. Based on my scrobbled list of songs, I favour D major.
• My City vs. Your City - Comparing listening habits/tastes between two cities. For example, Toronto and New York are very similar but Toronto vs. Zurich is quite different.
• FindtheBand.com – Utilizing LastFM and Spotify APIs, enter a band name and you get back a list of similar artists with Spotify band and song links.
• discoverOmatic.com – Love the developer’s description: “discoverOmatic takes the gooey BBC SPARQL endpoints, stirs in the fabulous echonest analysis and artist APIs, adds a pinch of last.fm’s scrobbling and recommender system, and binds it all together with MusicBrainz to make a completely awesome way to discover music based around what you’re listening to.”

Consumer Electronics Show: Music Apps Abound – Grammy’s iPhone App, Music Mastermind, Muzu.tv and MusicStation were some of the apps announced.

Play.Me is the newest ad-free music streaming service to crowd the field further. Launched in early January, I gave this a quick whirl and find that the interface is a bit rough around the edges and clunky and the catalog is not yet deep. The Free Pass account lets you listen to ten hours per month of ad-free music and $9.99US per month gives you unlimited streaming and ten downloads. Just wondering how many more of these services can the market support? How will they ever be profitable in a fragmented market?

A new version of iPhone app, Soundhound launches with Pandora integration, allowing users to launch Pandora radio stations based on songs and/or artists.

RadioTuna – I love internet radio. Commercial-free, no annoying DJs, and music you otherwise would never hear on terrestrial radio. What’s not to like? RadioTuna is a real-time search engine for online radio that makes it easy to discover and listen to online radio. Search by genre or artist and play the station right inside the browser. Radiotime is another internet radio aggregator that I really like.

MusicDNA – new digital file that is son of MP3 unveiled – Or will this be the orphaned son of MP3. Do we really need another format? If labels/artists wanted to, they could use the open-source Ogg format to multiplex audio/video/metadata. We also have commercial offerings like iTunes LP, CMX and MXP4. Do music consumers really want more than the music? Will they be willing to pay more for these “extras”?

Misa Digital Guitar replaces strings with touchscreen – Plays like a regular guitar but your right hand is used to operate a touchscreen. Sound runs through a MIDI controller and is sent to your computer or sound module. Watch the video to see how it works. Guitar purists might cringe but it still is creative software/hardware combo.

SoundCloud teams up with The Hype Machine to transform music distribution to blogs – Great news for artists and labels who have better control and measurement of music distribution across music blogs. Some music bloggers are still influential in spite of an extremely fragmented music business. We really need to see more of these types of collaborations across platforms and services.

YouTube Music Discovery Project and Playlist Creation Tool – Surprised to see that YouTube launched this and its not too bad for a first attempt. As a mainstream aggregation tool it will work for the average music fan. Tuberadio.fm launched something very similar not too long ago.

MusicAlly has put together an in-depth interview series exploring metrics for digital music. Check out interviews with: Eric Garland of Big Champagne; Alan Ault of WaveMetrix; Marie-Alicia Chang and Gregory Mead of MusicMetric; and Brad Little of Nielsen Buzzmetrics and Duncan Freeman, Bandmetrics.

Opinions, Insights and Analysis

Will the Digital Music Industry Shrink This Year? – According to a recent report (pdf) by Redwood Capital, consolidation in the digital music industry is inevitable, as many businesses and technologies will be acquired by more viable business models.

Radio is not dead. Read how TokyoFM is augmenting the listening experience over FM with additional information via the Internet. If you don’t follow Jerry Del Colliano’s blog, Inside Music Media and the future of radio interests you, you should check him out. He passionately covers radio and the impact that the internet and technology will have heading into the future.

Music industry hopes giveaways can reverse its sliding fortunes – “The industry has been forced to compete with free in a way that still generates revenues,” said Antony Bruno, the Denver-based digital editor for Billboard magazine. “And that’s driving a lot of these things you’re seeing now — the ‘Free MP3’ of the week on iTunes and all the Amazon.com stuff. These companies, and the music labels, are very well aware that they have to compete with the fact that people can go anywhere they want on the pirate level for free music.”

‘Freemium’ Services Damage Value Of Music – “I believe one of the greatest challenges for the music industry in the coming year will be to begin to tackle consumer perception that there is such a thing as ‘free’ music. As the previous decade witnessed a rise in free digital music services, my greatest fear is that there are now too many free messages in the space to keep music truly valuable in the eyes of the listener.”

Downloads Too Expensive? – According to this 36 page economic paper (pdf), digital music prices are too high and consumers prefer a-la-carte downloading to bundled pricing schemes.

Everywhere Access Key to Paid Music Models – “Paid music services are starting to shift their focus away from selling downloads and instead concentrate on granting users paid access to content—including the music libraries they already own. Apple, far and away the market leader in the digital music industry, has seen its iTunes ecosystem slow in growth, while cloud-based initiatives gather steam.”

From Dickens to Digitization: How Technology Killed Copyright – “Copyright infringement has stirred the souls of artists and publishers since the time of Charles Dickens, who went to the United States in 1842 to ask the Americans to stop pirating his works.”

The Music Industry – Two of the New Business Models – “While in the past the music industry was characterized by one dominant business model design (the one of the major recording companies), the future will be characterized by multiple competing business models.”

Curation, Playlists and the Death of the DJ – “The death of “the DJ,” or to put it more broadly, professionally curated music, is another story entirely. While terrestrial broadcasters are, in fact, killing off DJ’s left and right either through downsizing or simply eliminating live and local airshifts, the role of curation has never been more important, especially with the skull-drillingly vast array of music-as-commodity services available to music fans.”

Music Games Need to Refocus, Not Reboot – Joe Rybicki explores the changing dynamics of the music game genre, and examines what needs to change in order to keep things viable in the years ahead.

Rock Band Network Is Creating An Exciting New Industry In Music Gaming – “Music videogames like “Rock Band” and “Guitar Hero” have tapered off after huge growth in 2008 and years prior. But a new platform that lets musicians and labels upload and sell more songs to play along with could potentially boost user interest (and spending) again.”

And that caps another month. There is so much happening out there that it’s hard to keep up. Hopefully this monthly recap helps you keep on top of things and/or fill in those news items you may have missed this past month.

And one last thing, I promised myself that this edition will be iPad and Spotify news-free and I made it through without mentioning a peep! I came close but stuck to my word. You are probably just as tired of hearing the same things repeated endlessly in the head spinning tech echo chamber!

See you next month!

Gabriel Nijmeh is a software business analyst, passionate music lover and guitar player. He currently advises a couple of music startups, including Mediazoic, a real-time social DJ platform and co-founded the Toronto edition of OpenMusicMedia which brings people together to openly discuss the intersection of digital music, media and culture.

Where is music technology headed in 2010

Another year has passed and we can only hope – and more importantly work – towards making the new year and new decade in the music business less tumultuous and one where the the disruptive forces of change are embraced for the sake of the artists and fans. Because it’s about the music, isn’t?

Now more than ever we need to keep the focus on two important groups: artists and fans.  It’s about creative innovation, not exploitation. We still have a way to go but signs are pointing up as more people focus their energy on solutions-based thinking and building.

Before we look too far ahead to 2010 and usual set of predictions, let’s take some time to reflect on what transpired not just in 2009 but over the past ten years. Has anything been learned? Are we headed in the right direction? Will we be spinning the same wheels bare?

Did anyone imagine that in just a few short years the industry would face such swift, radical change leaving some still spinning?  Disruption for one group is innovation and opportunity for another and the battle will continue to rage between these two camps.

A review of 2009 on back…

CMU has put together their review for 2009 covering the media and the internet, the music business and artists and the music.

The A to Z of digital music startups in 2009 is an impressive list of digital music startups.

11 Interesting Moments For The Music Industry In 2009- Twitter, Social Media, Music Games, drop in concert attendance.

Bruce Houghton: 3 Trends, 13 Companies & 1 Wild Card To Watch In 2009 and How Did I Do With My 2009 Predictions?

The decade in music: Sales slide, pirates, digital rise – “Nothing defines pop’s past decade as much as the Internet and its evolving powers to alter the way music is created, marketed, shared and consumed. And, some would say, devalued and plundered.”

All the Rules of the Music Business Have Been Remade – From creation, distribution, consumption, it is utterly amazing how technology has flipped the business on it’s head and blown the gates right off.

What has the digital decade meant for music? – “The way in which we consume music has been revolutionised, but rumours of the death of major labels have been greatly exaggerated.”

2010 Music Predictions, Wishes and Guesses

Here’s a recap of some predictions written about for 2010. It’s a fun, year-end exercise and it might be a better idea for those making them to review them monthly, or at least quarterly. And better yet turning these predictions into actionable goals.

All the predictions in the world won’t matter unless the music fan is looked at like a valuable consumer and not some menacing threat.

Bruce Houghton has one prediction for 2010 and honestly, it’s less a prediction but good old common business sense: Those that serve the fan will thrive. Those that do not will whither.

Here are a few that are worth bookmarking and revisiting over the next couple of months:

• Five Music Predictions for 2010 (and Five Reasons Why 2009 was a Flop)
• 8 Key Trends for the Next 5 Years
• Bob Lefsetz’s Predictions
• The Year in Digital Music and Predictions for 2010
• Bobby Owsinski’s 7 Music Business Predictions For 2010
• 2010: 5 Music Business Predictions (And A Football One)
• 10 music-tech trends that will shape the next decade

And as for my thoughts for 2010 and beyond?

Service Agnostic Playlists:
I believe that in 2010 we will start seeing more service agnostic, portable and shareable playlists. You just enter the name of a band or song, and a new service like Playdar (hooked in with the XSPF format) will help you find the song either on your local drive or any music service(s) you might subscribe to. Playlistnow.fm, Stereomood.com and Playlist are examples of the shift from MP3s to playlists, and as an end user you aren’t as concerned about where the music is located.

Music in the Cloud Goes Mainstream:
Sure, anyone with the time and inclination can use Simplify Media, Subsonic, Tunesbag, MP3Tunes to create their own streaming music service but only the biggest, most meticulous music geeks are doing so. 2010 we will see, directly or indirectly, Apple, Google, Amazon making moves towards cloud based music service offerings.

Apple and Others Finally Get Social Music:
For most of us, music has always been a social activity and we are already enjoying the social nature of music online using sites like Twitter, Blip.FM and other third-party, independent services. Apple, Google and other big players will finally start taking it seriously and will build social networking functionality into their core service offerings.

Music Tech Investments
Duncan Freeman of Band Metrics has just posted his list of music tech investments and M&As for 2009. There was certainly quite a bit of activity and will we see more investment activity in 2010? GigaOM recently posted a piece: After Weak Exits In Digital Music, VCs Start Smaller offering some additional perspective. Investors may be stepping back a bit but are not stepping away completely from investing in the digital music sector. Investment returns in music streaming services haven’t been as hoped for but there are other (not as sexy as Spotify) digital music opportunities that don’t face the same, out of the gate, licensing hurdles. With $154 billion of venture money still sitting on the sidelines, that money will have to be invested somewhere, right?
December funding news:

• App Store Champ Smule Raises Another $8 Million
• Podcasting company Lexy raises $458k in debt financing
• ZumoDrive Raises $1.5 Million For Cloud-Based Mobile Music, Media Access

Music Services and Mobile Apps

New iPhone apps like Flypt (music remixer), PRS Jam App (for guitarists), Muppets Animal Drummer (music rhythm game), Beaterator (music mixer) being released are becoming much more interactive. Instead of just being passive listeners, music lovers can now try their hand at being creators, producers and remixers.

Soundtrkr is another interesting app I played around with this month. It’s a geo-tagging music app that lets you connect with other music fans in your area. It’s like Foursquare for music. It will probably be just a matter of time before Pandora or LastFM add this functionality which I think would be brilliant move. Myxer launches MobileStage, a mobile marketing platform for artists and brands/advertisers.

Nowplaying.FM – With so much music/bands being discussed on Twitter, there isn’t always a link provided to the music. With Nowplaying.fm, they are a music search-and-play service in the style of GrooveShark which searches various services and finds the song you want to hear. As I already noted, this is where Playdar can really shine as a music content resolver.

PlaylistnowFM – Similar to Stereomood, you can listen to preselected playlists based on mood/what you are doing. Clean interface (combines elements of Blip.FM and Twitter) and a decent selection of tunes.

Playdar – I’m going to keep an eye on this one in 2010. It’s a bit of “geeky” but very promising tool. Some smart developers will create amazing apps/services that will make it even easier for the music fan’s to discover and listen to music. For early adopters getting their heads around it and Playdar powered services like Playgrub and Playlick, the focus will be building playlists and less on where the music is located. I really hope to see Playdar underpin a lot of future music services which ties well into my thoughts about service agnostic playlists. Read this write-up for a really good description of how Playdar works.

Amazon Adds Audio and Video Streaming to CloudFront – This announcement slipped through quietly. For no additional cost, Amazon will let developers/companies stream delivery of audio and video content. Keep an eye out for new and upcoming service launches now that this type of technology is easily accessible and affordable.

Best of 2009: 10 iPhone/iPod Touch Music/Sound Apps – Suzanne Lainson has recently posted a very thorough article detailing the potential iPhone music revolution where many free and/or cheap tools are allowing music fans with little or no musical talent to create music. It may not be all that good but at the very least, fans will garner a better appreciation of the time and effort that goes into the creative process.

Opinions, Insights and Analysis

In 2009, the hot talk was about Spotify (will they or won’t they launch in the US?) and in 2010 music in the cloud will be on everyone’s lips. There is still a way to go before we see commercial offerings and mainstream adoption but a lot of the hurdles are being knocked down including: technological, costs and cultural.

Music in the Cloud: Heavenly or Pipe Dream? – There are enough open-source tools and software that lets you share and stream music from your computer anyway, so streaming music from your “personal cloud” is already here. It’s just that many people can’t be bothered with setting up, maintaining and backing up their libraries. Once Apple flips the switch, it’s game on. See next article.

How Apple’s New Music Strategy Reflects a Paradigm Shift – This is a great piece with two key points: 1) the transition toward streaming rather than owning is slow, but real. and 2) Apple is still betting on owning music in a new way, rather than subscribing to it.

In the legal download world, someone has to pay for the music, so will 2010 be the year that “brandvertising” finally proves that ad-supported music downloads work? Free for All and Guevara are going to try hard to prove so. And with so much activity on the mobile front, it will be interesting to see if 2010 “will be the year mobile begins to realize its potential for marketers.”

Here is a great article that describes the The Problem With Free. It is summed up best: “When you pay for something, you appreciate it more than when you get it for free.”

APIs Can Set You Free — “Music — or any kind of information, for that matter — no longer emanates from a centralized source. Instead, it reaches listeners’ ears through a plethora of tweets, blogs, widgets, apps, social nets, search services, recommendation engines and the personal messages from the artists themselves.”

Formula That Can ID Music Industry Payola Developed — “A University at Buffalo researcher has invented a statistical method that can detect payola-like corruption in the music industry, a system that gives law enforcement an inexpensive statistical guide to identify potential music corruption and to better target more traditional and much more costly hands-on evidence-gathering.”

4 Ways One Big Database Would Help Music Fans, Industry — Great idea but very challenging to implement and maintain. We already have MusicBrainz and FreeDB plus other proprietary music industry databases. Trying to reconciliation and bridge commercial and open source interests won’t be easy. And I hate saying it but it will be impossible to reach any consensus or standards to satisfy all parties.

What was once thought will be a music business saviour, music video games sales peaked in 2009 and sales forecasts missed . Are consumers bored? Will 2010 be any better?

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And that caps another year in the business! Where do you think we are headed in 2010? What do you hope to see happen? What are you working on that you feel will make a long-term difference?

Gabriel Nijmeh is a software business analyst, passionate music lover and guitar player. He currently advises a couple of music startups, including Mediazoic, a real-time social DJ platform and co-founded the Toronto edition of OpenMusicMedia which brings people together to openly discuss the intersection of digital music, media and culture.