As rumored, Rhapsody downsizes, Irwin out as president

Tuesday, September 17, 2013 - 12:00pm

Last week when word hit that pioneering music service Rhapsody might shake up its leadership, RAIN editor Brad Hill asked (here): "Can a subscription-only service provide compelling value against free-listening platforms? For that matter, can any streaming-music business hold its own against content costs?"

The official word came yesterday (and was covered right away by The Verge's Greg Sandoval) that Rhapsody will "rebalance and restructure U.S. operations," has laid off 15% of its staff (30 workers), and will replace top managers like president Jon Irwin (who'll move into an advisory role) and CFO Adi Dehejia. Rhapsody's new "executive operating committee" will be made up of executives Brian Ringer (CTO), Paul Springer (SVP/Americas), Thorsten Schliesche (SVP/Europe), and new CFO Ethan Rudin.

The company also announced investment firm Columbus Nova has taken some ownership of the company. Columbus Nova, by the way, owns Harmonix, which owns the Rock Band videogame franchise. Rhapsody says it will "add resources to enable the company to accelerate its efforts in Europe and emerging markets."

Sandoval puts Rhapsody's fortunes in the larger context of the tough go online music services have had.

"In the post-Napster era, we've yet to see a single digital music distributor generate lasting or significant profits," he wrote. "More recently, Spotify's losses have grown. Grooveshark has cut the size of its workforce. Rdio has struggled to keep pace with Spotify in terms of building an audience. In this environment, Rdio and others are trying to stay competitive. Operators of these sites say the obstacles are significant, as consumers remain reluctant to pay for songs and the cost of licensing music is still too high" -- the two very points Hill made last week in RAIN.

Read Rhapsody's official announcement here. Read Sandoval in The Verge here.

New Rhapsody "companion" app adds touring info to functionality of streaming service

Wednesday, June 12, 2013 - 1:50pm

Streaming music service Rhapsody has launched a new "companion app," focused on artist touring and selling concert tickets.

The new app combines the company's on-demand music streaming service with an easy way for listeners to find live events and purchase tickets.

Rhapsody president Jon Irwin keynoted RAIN Summit West in Las Vegas in April. He spoke of the importance of connecting artists and listeners in meaningful ways, and going beyond simply delivering music in the effort to create "the Ultimate Stream."

This is Rhapsody's second "companion app," after the Songmatch app that identifies music (like Shazam) and can automatically add it to Rhapsody playlists. The new Rhapsody Concerts app was released for iOS today, with Android to follow.

Our recap of Irwin's RAIN Summit West keynote speech is here, and you can hear complete audio here. CNet reports on the new Rhapsody Concerts app here.

Rhapsody's Irwin suggests strategic partnerships to defray costs, make services more attractive to consumers

Wednesday, May 22, 2013 - 6:20pm

Streaming music service Rhapsody has committed to providing "liner-note-style credits" for every track in its 17 million-plus library, including the names of producers, engineers, composers, session performers, and more (you can read more about this in The New York Times here).

There are likely several reasons why Rhapsody would commit to such a huge undertaking, but one might just be that enhancements like this help make service the center of (listeners') music experience," to quote the company's Jon Irwin. Irwin, Rhapsody International president, gave the second of two keynote addresses at the recent RAIN Summit West event in Las Vegas.

Liner note-style credits would also help the listener and the artist to "connect in a meaningful way," to again paraphrase Irwin -- fundamentally necessary for creating the experience for which consumers will pay. 

The streaming music/Internet radio space is certainly crowded, yet Irwin maintained that none of these companies are "really killing it" from a customer experience perspective, or from a profitability perspective (and he includes his own company in that assessment). "Nobody has nailed it across all content types and all listening modes," he said, to offer what he termed "the Ultimate Stream." That is, the various types of content (music, news, sports, comedy, live radio) a listener might want at different times, in any listening venue or device (in the car, the mobile phone, at home).

Irwin listed what he thought the necessary qualities of the perfect music service interface. It would (be):

  1. deeply personal
  2. drop-dead simple
  3. connect fans to artists, personalities
  4. new yet familiar
  5. easier than piracy
  6. guided by trusted sources
  7. needs to be embraced by artists and personalities.

Yet creating that is just half the challenge. There's the question of creating "a rational business model" he mentioned. That is, balancing the need for momentum and growth, yet "making sure you're following a sustainable business model, in which you're delivering enough value to your listeners so that they'll pay you for the service" (either by accepting ads or paying a subscription fee).

One solution he offered is for streamers to partner with services with which consumers already have "trusted billing relationships" -- like mobile carriers. Rhapsody itself has partnerships with moblie carriers Metro PCS in the U.S., and E-Plus in Germany. The cost to the consumer is decreased (as its subsidized by the carrier), and it's easier to pay because it's rolled into a bill they already pay. Parntering in this way "takes you down off that $10 price point, you can get actual and perceived reductions in well over 50% for consumers and still give them a great experience," Irwin said.

We have audio of Irwin's speech (and all our RAIN Summit West content) available for free via SoundCloud. Look for the links in the right-hand margin of Irwin also published an op-ed summarizing his speech in Hybebot here.

RAIN Summit West will take place April 7th in Las Vegas

Thursday, January 31, 2013 - 1:35pm

RAIN Summits has confirmed Rhapsody International president Jon Irwin as the second keynote speaker for RAIN Summit West, April 7th in Las Vegas.

Rhapsody is the U.S.-based online music subscription service with more than a million subscribers. It offers access to over 16 million tracks on more than 70 consumer electronics devices. Just this month Rhapsody announced a partnership with wireless phone provider MetroPCS allowing customers to add Rhapsody for $5 to its newly simplified select monthly smartphone plans. At the recent Consumer Electronics Show, Rhapsody announced its availability in Ford and Lincoln vehicles with SYNC AppLink.

Irwin, Rhapsody International's top executive, joined Rhapsody America in 2009 as COO and chief of staff. He planned and oversaw Rhapsody's 2010 spinoff from parent RealNetworks into a standalone company. In late 2011 Rhapsody acquired competing service Napster. His specialty has been in building strong subscription businesses, with prior senior positions with Boingo Wireless, Earthlink, InfoNet Services Corporation, and WorldCom. He recently told Inc. magazine he doesn't believe in the "freemium" approach embraced by some of Rhapsody's competitors (RAIN coverage here).

Earlier this month RAIN Summits also announced (here) Radio Advertising Bureau's Erica Farber as a RAIN Summit West keynote speaker.

RAIN Summit West, Internet radio's premiere industry gathering, is held annually in Las Vegas during the week of the NAB Show. Now in its 12th year, the Summit focuses on the intersection of radio and the Internet, and is geared to both broadcasters on the Web (like Clear Channel Radio and CBS Radio), and Internet-only webcasters (Pandora and AccuRadio).

Previous keynote speakers at RAIN Summits include ESPN senior vice president Traug Keller, Pandora founder Tim Westergren, Hubbard Broadcasting (at the time Bonneville International) president and CEO Bruce Reese, NPR SVP/Digital Media Kinsey Wilson, and Pandora CEO Joe Kennedy.

RAIN Summits will announce more speakers and panel topics in the coming weeks. Other RAIN Summits are set for later this year, including Europe in late spring, and Orlando (at the RAB/NAB Radio Show) on September 17th. For information on the event or for sponsorship information contact RAIN Summits president Jennifer LaneRAIN Summit West is a co-located education program of the NAB Show.

Rhapsody's Irwin says Pandora's, Spotify's "freemium" approach won't work

Wednesday, January 16, 2013 - 12:25pm

Rhapsody Intl. president Jon Irwin told Inc. magazine he doesn't think Pandora's and Spotify's "freemium" model  (that's when a basic version of a service is available free, but a subscription is charged for the full-feature version) is the way to go.

Inc. reports Irwin believes Spotify's (and Pandora's) strategy is to "build a big name and a big user base by giving away the store, then do an IPO and leave the shareholders to figure out if the service can make money." He says his company's strategy is in building partnerships with automakers, mobile providers, and consumer electronics manufacturers (which, of course, Spotify and Pandora have done with wider success). Rhapsody did, in fact, launch its app for the Roku set-top device this week (more here).

Spotify has 5 million paying subscribers, plus 15 million more who use the service free. Pandora says in December it had 67.1 million "active listeners" (the vast majority of whom listen free). Rhapsody, which doesn't offer free usage, has 1 million paying customers.

Irwin reportedly revealed to GigaOm his company's plans to expand into 16 more European countries (see RAIN here) in the coming months (Rhapsody is available in the UK and Germany under the Napster brand name).

Read more from Inc. here.

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