Spotify Confirms U.S. Launch (sort of)

Spot the Spotify U.S. holding page and sign up for an invite! That's right. Finally, Spotify is admitting they are rolling out in the U.S.and the last few deals with labels, publishers, collecting societies, and the rest of the hornets nest that embodies the music industry have apparently fallen into place.

This is great for my friends and family, and the rest of you back in the old (new) country. This is one service that can really fly in the U.S., especially if they get that deep integration with Facebook that we've been hearing about. Spotify was not included in today's "awesomeness"  from Zuck and Co. but don't underestimate the power of a one-two punch. If FB gets both Skype AND Spotify integrated they will add a whole lotta stickiness to FB as an IM/Entertainment dashboard. Add all of your music likes and recommendations to the graph and soon we have a soundtrack for social advertising, pulling up the right content based on what is playing on my Spotify right now. Not necessarily music-related ads but simply using that soundtrack/playlist/catalogue and comparing it to the the social graph and serving up the right stuff. The converse could be even more vital for Spotify as they can now get better analytics for targeting ads into their free client.

Daniel Ek and friends just bagged another $100 million. One could argue that these monies could have helped finalize the label deals, but you could also wonder if the label deals helped convince investors of the viability. A successful U.S. launch weighs heavily on their future profitability.

Good luck, Boys! And to the rest of you, "Go sign up!" (shameless fanboy, I know)

iCloud freeing your iDevices - but no streaming.

Apple announced iCloud today. Finally! Free the masses from that bloody iTunes tethering. That's great for those iProduct users that can't master syncing everything via other services such as Google. All of your documents, calendars, contacts, mail, and media, will be synced immediately over the cloud. Fantastic! You can even "match" your music library into iCloud and get everything synced across your devices from iTunes. No need to upload your entire library like Google Music. A clever way to legalize all of your music you gathered up from various sources both legal and questionable. Another great innovation by Apple - sort of. 

Here's the breakdown. Omnifone did the library matching 4 years ago for various mobile service providers and OEMs. This was done in partnership with Gracenote and their services included this type of playlist matching (PlayNow Plus for Sony Ericsson among them). One could also synchronization between PC and Handset. Anything done on one side mirrored directly on the other. You could also select which tracks, playlists, etc. to sync to your handheld in order to manage memory. The thing with these earlier services was that they pushed eAAC+ files to the handsets. Significantly smaller file sizes and very good audio quality for handheld listening. An entire album would download in about 1 minute over a normal 3G network.  Today that time would be closer to 30 seconds.

Now that I have ranted on Apple not being original let me raise a couple of points from their presentation. Some things just don't add up.

1) Steve said that, for $25 annually they will match your library and provide you 256kbps mp3 files without DRM. He also said that this service may be deployed across up to 10 devices. Now… how can a file be DRM free and be limited to 10 devices? If they are DRM free and I don't renew for next year, how will they block or delete them? You get my point.

2) Why no streaming? I chalk this up to the publishers more than the labels. The labels are more than happy to get their cut of $25/user you for music that they have likely already purchased. Basically doubling up on the rights. So I'm certain that the labels will allow Apple to turn on the streaming once they get to a certain number of subs. The publishers and collecting societies, on the other hand, have yet to find a good solution for how they choose to understand these business models. Basically there is no margin in track sales. Kids aren't interested in ownership. Subscription services will be the future. It is a complex matrix of service definitions that determine the license type. Apple is surely paying publishing for a new digital copy of every track they "match". What they will argue in the future is that you can stream to yourself, everything that you have matched and/or purchased via Apple, and thus avoid performance or web radio rights. If Apple were to make available the entire catalogue to you for streaming (like Spotify or Rdio, etc) then they would be paying yet another license. That's how it works.

iCloud launches sometime in the autumn. So for now, we will just have to wait for Apple's next big thing, without streaming.

Apple Patenting Music Caching? C'mon!

So apparently our friends at my favorite fruit company are out after "revolutionary" patents and marketing headlines. Over on Geeky Gadgets and other sites they have reported that, in advance of an iCloud announcement, Apple has filed for a patent optimizing track buffering performance over streaming services by caching portions of the songs to your internal memory (schematic below). The idea being that if the first few seconds of everything in your cloud library is cached locally (maybe cleverly managed by play count statistics) then when you jump to the next track there will be no streaming lag. Apple, when they finally launch a cloud streaming service, will tout this as the coolest, newest, most revolutionary thing to hit streaming music since, well, streaming music. Problem is they are about 4 years behind on this point if not more.

Spotify does this today and has been using this methodology, albeit better, since their inception. I remember being in a meeting with Spotify reps early on when they were pitching this new concept to our team in order to ingrate it into our handsets. Groundbreaking then. Proven success now. Spotify's version, however, uses a structure similar to torrents where not only do they cache a large portion of your cloud playlists locally - but what  is not available locally on your device is cloud-sourced among other Spotify users that are online, thus accelerating the startup time for every track.

So I have a hard time seeing how Apple can legitimately get a patent for this but stranger things have occurred in patent land. All in all, for me, it seems yet another indicator that Apple, despite its immense success, is struggling with the disruption of other services to their long, tired, ecosystem. I love Apple, and Steve is God in the tech world, but I wonder how much his illness is beginning to ripple into operations and visions. Let's keep an open eye on that one.

Google Music vs. Amazon

OK. So Google announced their Music beta. Personally I think it's a big step in the right direction and totally get their legal logic. Screw the labels. Avoid the publishers. A pure locker service where you can store up to 20k songs. That's a shitload more than the average Joe has out there in their digital catalogue, and for those with well over 100GB of music this could be a fantastic service. 

Here's where Google is differing from Amazon. They aren't selling music. And they are, therefore, not accessing a library of licensed master recordings that they have licensed for track sales. Google avoids dealing with the labels as the music is yours already. No dealing with the publishers either as they are not streaming from a central library as part of a subscription service. A pure cloud storage/streaming solution.

Downside? Well… you have to upload everything, but that's a one off. Again, for the average Joe with a thousand tracks or so this is minimal pain. The success would lay in the performance of the streaming and start times, as well as the interface. I really don't see the lack of track sales as a negative for the end user. The "Measure of Cool" has changed and ownership is a burden. When I was young the measure of cool (mock) was how many orange crates of vinyl you had stacked up in your room. Then it was how many shelves of CDs in your living room. That evolved to how many GB of MP#s you had on your hard drive and, of course, now the measure of cool is how much you can access at your fingertips without having to manage all of those files.

So Google Music beta is out, and can be a great thing. Will they succeed? Remains to be seen. What I would like to see is that they would make integration available to existing subscription services like Spotify, Rdio, etc. to be able to add my cloud to these excellent online services. And, of course, lift the US only restriction.

Google being Google I do expect to see some advertising showing up in any fermium model but this in itself will present problems. You can be sure that, if Google adds advertising around the metadata of my music library, artists and publishers will be coming fast and furious with a new license for using that metadata. But that is a subject I will save for another post.