Music Biz News, WMG seeks demise of SeeqPod

My mind is still on the Music biz these days. Probably because I am feeling depressed about not being at MIDEM in Cannes this year, since it was an amazing time being there last year. There is so much dynamic vitality in the music world from so many points-of-view. There is an abundance of new digital music services and devices and easy access to music of all kinds. Music as a social network means and medium is enjoying exponential growth, i.e. imeem, MyStrands etc. All this makes the massively depressing ’07 music sales stats even more ironic. The numbers cited and the ’08 projections are even more dismal than most pessimists predicted.

The Economist 10 Jan Articles “From Major To Minor” concludes: “Universal and its fellow majors may never earn anything like as much from partnership with device-makers as they did from physical formats. Some among their number, indeed, may not survive.”

The article posits a trifecta of woe for CD sales:
1. Reduced retail floor space due to reduced sales resulting in further reductions
2. Decreasing Label budgets for releasing new records resulting in further diminution of the biz
3. A reduction in capitalization and investment due to poor returns.

This vicious cycle is likely to make 2008 feel like dropping off a cliff to the recorded music industry and bolster competitive efforts by companies such as Live Nation and artists that are going direct.

The article reports the Nielsen SoundScan number of US CD sales dropping 19%. Both The Economist and Digital Music News report that the 2007 sales were just as bleak worldwide:
• Spain: -22%
• Canada: -21%
• France: -17%
• Australia: -14%
• Italy: -12%

NAPSTER REDUX
In an inevitable move, one of the majors, WMG, has gone after the new Napster (by which I mean the old Napster that started the MP3 download craze and was successfully shut down in July 2001), SeeqPod.

Seeqpod is in some ways easier, better, and even more pernicious to the established music industry than Napster. It allows you to search for any music or video by artist or title, play it instantaly, store it onto a playlist and share the playlists.

In its 57 page complaint to the California Central District Court, The Warner Music Group (Warner Brothers, Atlantic, Elecktra and Rhino) does not mince any words. They are going after the Seeqpod Inc. and their “Angel” investors for both direct and contributory infringement for the max $150,000 per instance of which there are 100s of thousands. They plainly articulate how Seeqpod is egregiously enriching itself by growing its user base at the direct expense of the copyright holders.
SeeqPod has attempted to play dumb by claiming that it is only a search engine like Google, albeit specialized for the deep vertical media niches. True, Seeqpod does not store nor serve, nor even maintain an (Old) Napster-like directory. It merely points to extant mp3 files and provide a convenient means to store your searches and play them.

This will be an interesting case since it may also have implications for the Googles of the world who, it could be argued, also enrich themselves by searching for copyrighted work.

The labels measure how much a music service impacts them by how much of a replacement that service is for an untethered, unrestricted CD. Indeed with SeeqPod’s iPhone app and ubiquitous edge network access it is not far off. Sphere: Related Content