Rdio finds its new CEO, Anthony Bay

Tuesday, December 3, 2013 - 12:40pm

Two weeks after restructuring its costs via workforce downsizing (in other words, layoffs), Rdio has named a new CEO. Anthony Bay, former head of digital video at Amazon, replaces outgoing CEO Drew Larner, who becomes vice-chair of Rdio’s board. Larner announced his resignation five months ago.

Bay has been involved in digital media for nearly 20 years, with stints at MOD Systems, Loudeye, and Microsoft where he was GM of Redmond’s Digital Media Division. He left Amazon in March of this year in an executive shakeup in the company’s digital services department. At Amazon, Bay’s purview included Amazon Prime, the subscription video-streaming service, an operation which parallels Rdio’s business model in some respects.

Rdio is facing a daunting competitive landscape in the U.S. market, with direct competitor Spotify owning a larger user base, and Google All Access enjoying a vast ecosystem placement in front of millions of potential users. Furthermore, newcomers Deezer, YouTube, and Beats Music either rumored or promised to enter the fray in the next few months. All these subscription services compete generally with Internet radio platforms such as Pandora, iTunes Radio, and dozens of smaller players for a broad listening audience which doesn’t necessarily recognize how the brands differ.

Rdio’s deep cuts and the troubling future

Wednesday, November 20, 2013 - 10:50am

Rdio, competing for audience in a crowded online-music market, made significant workforce reductions to lower costs. Layoffs are reported to have carved out about a third of the company.

The subscription music service competes directly with Spotify, Rhapsody, Google All Access, and Xbox Music in the U.S., and more generally with Pandora, iTunes Radio, Songza, Slacker, and other radio-style streaming platforms.

In the wake of the layoffs, Rdio made confident noises about its future destiny: “Rdio confirms making workforce reductions yesterday to improve its cost structure and ensure a scalable business model for the long-term.” But the road will get rockier in the short term.

Rdio started in 2008, and opened its platform to the public two years later, about one year before Spotify expanded into the American market. Despite the early-mover advantage in the U.S., and without the significant European listenership Spotify built up since its 2008 launch, Rdio lags in audience metrics. The company did not release updated numbers today, but Digital Music News is quoting 250,000 paid members. Spotify boasts six-million paying subscribers.

At least one departing Rdio worker was a contractor, not an employee -- Ian Gilman, a freelance app developer, who documented his exit on Twitter and called Rdio his largest client. It is common for companies trimming costs to look hard at their contracted labor force. But little is known about the “Who?” and “How many?” of today’s action.

Jukebox service Rhapsody, the grand old uncle of subscription music, underwent a layoff sweep in September, and a management shakeup that ushered its CEO out the door. Coincidentally, Rdio’s chief executive had announced his departure, but is still in place while the headhunters look for a successor.

Rdio operates a sister site, Vdio, which rents movies on a one-by-one basis. There has been speculation that Vdio would eventually move into the subscription model, and would somehow integrate with Rdio. The movie/TV subscription business is dominated by Netflix, Amazon Prime, and Hulu.

Speaking of daunting competition, the already crowded music landscape is about to be glutted with three additional major players in the U.S. YouTube is reliably rumored to be building a music service. Beats Music has announced that its “Daisy” listening venture will launch within months. And Deezer, a popular Paris-based international service is reportedly coming to America early in the new year.

So, by the end of Q1, the streaming music industry will be more top-heavy than it already is. The good news for consumers will be the bounty of choices. The bad news on the business side is that, to many consumers, the listening options are indistinguishable. That is a scenario in which the rich get richer, and the others get bought.

The real threat of Google Music on Apple devices

Monday, November 18, 2013 - 11:55am

Last week’s drop of Google’s All Access music subscription app into Apple’s app store was a milestone moment in both the music-service wars and the larger tech-ecosystem land grab. We had fun with our “Google invades Apple” headline, and every media site covering the convergence of music and Internet hit the same note.

The invasion metaphor is apt, more than just for its imagery of two tech/media giants engaged in business warfare. Google’s Play Music All Access, awkwardly-named thought it might be, offers a more complete music platform than Apple does -- and likewise for Spotify, Rhapsody, Pandora, and Rdio. The competitive thrust is more feature-specific than merely inserting the Google brand into the music choices of iPhone and iPod users. Its features connect with the three major ways that people connect with Internet-delivered music as a 21st-century type of radio.

Three Types of Listening

There are three types of app listening. By “app listening” we mean listening that happens through a desktop program, a web browser, or a mobile app. There are three cornerstones of app listening:

  • Radio: Broadcasters understandably bristle at the re-definition of “radio,” which used to denote a technology, not a behavior. Now, “radio” commonly means lean-back app listening that simulates the traditional passive radio experience. Pandora is the poster child for “Internet radio,” but Pandora is more interactive than thousands of Internet pureplay stations which don’t offer any customization.
  • Jukebox: The “celestial jukebox” is lean-forward listening in which access to music replaces ownership of music. Spotify, Rhapsody, and Radio are leading examples of app services that provide access to huge song catalogs on demand, with suites of features that personalize the jukebox around the user’s taste.
  • Cloud storage: Even with the rise of Internet radio and the celestial jukebox, people own personal music collections in digital file formats. Amazon, Apple, and others provide apps that allow uploading those files to the cloud, from which they can be accessed from any connected device.

Integrating these three modes of listening is not easy, or common. How do personal collections (the ownership model) fit into subscription services (the access model), and how do those users integrate the existing value of their collections with the new value of music access?

It’s Called “All Access” for a Reason

That is the key issue addressed by Google Play Music All Access, and a key selling point of its subscription service. All Access provides the usual access features -- jukeboxing, playlisting, favoriting, downloading for offline listening. At the same time, All Access (living up to its name) is a cloud storage service which invites users to upload 20,000 tracks. Those collections are integrated into the jukebox service, and intelligence derived from scanning the owned music helps personalize the music Google suggests to the user.

Apple has a cloud service, too, and of course iTunes is the world’s biggest music store, still a champion of the ownership model, widely predicted to be waning. The two-month-old iTunes Radio service provides lean-back radio-style listening, a second rung of the app-listening ladder. But Apple does not have a celestial jukebox function for random access and full listening of songs and albums.

That missing piece is the opening through which Google has driven its All Access platform, and why the invasion is meaningful. Google provides both models -- access to an owned collection on the same platform which accesses the celestial jukebox, and plays radio-style streams.

Google craftily makes it easy to convert an iTunes collection to Google’s cloud. Doing so gives Apple users a full, three-point app-listening experience on iPhones and iPods. Google provides the purchasing dimension too, through Google Play song-buying, which emulates the synergy of Apple’s iTunes Radio and iTunes Store linkage.

It’s not only iTunes that could be hurt by Google. Spotify, Rdio, and Rhapsody lack cloud integration of personal collections. Google sits in the iOS store as the complete problem-solver -- in that light, the awkward “All Access” name is justified. The extra value it brings signifies why Google invaded Apple. Time will tell how disruptive the invasion will be.

Listn gets funded for social music listening

Thursday, November 7, 2013 - 11:50am

Listn is a music app owned by MFive Labs that expands the social possibilities of music listening by connecting people, and their music collections, across platforms and services. The company received $500-thousand in seed funding this week, giving it a foothold for future growth.

The presumption is that many people use more than one music service, or have more than one collection source -- for example an iTunes collector might also have a YouTube account and be registered at Spotify. Listn solves the “walled garden” problem by providing an encompassing space in which to share content from multiple sources, and develop a social network that likewise crosses boundaries.

Currently, Listn has connection agreements with YouTube, Spotify, Rdio, and SoundCloud. An Apple-only app presently, Listn also soaks up information about your iPod or iPhone collection purchased from iTunes, adding those tracks to YouTube favorites, and your music associated with membership in the other services.

Listn provides a twofold benefit. First, the user doesn’t have to hop from one app to another -- one’s entire macro-collection is presented in a single location. Second, the realm of social sharing and following is greatly expanded. In Listn you meet new people and are exposed to more facets of a person’s music life.

That second point has yet to be fully proved out, in our opinion. Listn provides an interesting way to meet new people, but does not transfer social relationships from connected music service, as it does with music. So, while you can listen to your Spotify tracks in Listn, you cannot listen to your Spotify friends’ playlists unless those friends pile into the Listn app. A socially active subscriber to Spotify, for example, would probably fall back to Spotify where his or her friends are.

Listn’s core mission is reminiscent of the Instant Message startups which pulled that form of communication out of the early web services (CompuServe, Genie, Prodigy, AOL), and unleashed it to the open web in the mid-1990s. That transition can be difficult, when users are reluctant to jump off their islands into the ocean. But the idea behind Listn is solid. People who use multiple music services are forced to engage with separate social schemes. The social aspect of online listening would be more useful and enjoyable if it were more open.

Rdio improves personalization of its iOS app

Wednesday, November 6, 2013 - 12:15pm

In the conforming world of subscription music services, many of which share the same broad features, it is easy to assume that they exist in parity, competing on the basis of design rather than function. But then one of those services will update one of its products, and it becomes apparent that it has lacked an important feature that might have existed on competing platforms for years. That was the case when Rhapsody recently introduced genre stations -- basic, belated, and nicely implemented.

In that context, a new update to Rdio’s Apple app is surprising, but welcome. Rdio now refines its playlist suggestions on the basis of the user’s listening history and social following. This refinement is crucial in any listening service which hopes to retain its users. When the service gets smarter about your taste over time, it plays better music and gains in value. Without that increasing stickiness, retention is more difficult.

Along with the underlying intelligence layer, the iOS app now makes a three-fold display of songs in the playlist. The current album art is surrounded by previous and next selections, enabling the user to swipe ahead to the next track, as illustrated in the screenshot. (You cannot swipe backward, alas.)

Music services not boarding the early Christmas train, but maybe they should

Monday, November 4, 2013 - 1:10pm

Tom Taylor notes in his morning newsletter that all-Christmas radio is breaking out early on the broadcast side. Taylor’s interpretation: “Most are an attempt to lay claim to the local market’s Christmas image -- even if it irritates regular listeners.”

Local broadcasters walk on a thin November ledge between pushing Christmas upon listeners too soon, and attracting Black Friday ad dollars before it’s too late. Most online music services don’t have a sufficient local sales effort to worry about that conundrum, Pandora being the exception.

But a close look at activity in several music services this morning offers indications that users might be swinging into the holiday mood sooner than their in-house programming departments. Holiday listening stations don’t usually appear in the genre lists of music services this early in November, and that trend is born out. The following services lack a Christmas or Holiday preset in their “stations” lineups: iTunes Radio, Pandora, Spotify, Rhapsody, Rdio, Slacker (even as a sub-genre of Christian).

Interestingly, user-generated 8tracks.com shows a Christmas tag fairly high up the genre list (Android app), and digging into the details on the website shows over 300 user-created Christmas playlists, dozens of them created in the last few days. Creator comments reveal an eager early-season jubilance: “The jolliest time of year is back!” Some of these playlists were assembled in mid-October, indicating some degree of appetite for the Christmas spirit even sooner than broadcast radio is willing to bet on.

Perhaps unsurprisingly, Clear Channel-owned iHeartRadio is displaying a “Holiday” channel preset this morning in the Live Radio section. Some of the listed stations are pureplays, not live, but the interesting point is user comments -- many listeners are happy to find the early dose of Christmas tunes. “Start super-duper early! Why not?”

Note to Apple, Pandora, Rhapsody et al: The Christmas train might be leaving earlier than you think. When you have an unlimited programming slate, it makes sense to claim the space early.

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