Tuesday, October 21, 2008

MySpace Music: Penthouse or Third-Floor Walkup?

By guest blogger Greg Capobianco
October 21, 2008

When MySpace Music launched last month, early reviews were generally mixed, although most were optimistic for what the service could eventually become. MySpace’s revamped music component was long in development, so the fact that it was finally released was newsworthy in and of itself. A few weeks in and over a billion streams later, we can finally look a little deeper at the quality of the service and what it could mean for artists and fans.

The Welcome Mat
The MySpace Music interface itself is probably the chief point of contention for users. Although it’s likely that fans of the current MySpace design will find the layout completely acceptable, those who already think the core site is cluttered and obtuse will probably feel the same about the company’s music venture. That said, there were no user interface dead ends in our testing and, despite lacking some design refinements, it’s solid enough in terms of functionality. Managing and sharing user-created playlists is easy, and purchasing music is as simple clicking the “buy” button, which takes you to the Amazon.com MP3 Download Store — widely considered to be the largest legitimate competitor to Apple’s iTunes.

The Directory
Browsing by “Top Artists” provides three lists, each one featuring 100 singers/bands. It’s nice that MySpace Music breaks out the top major label, indie and unsigned artists into separate categories, potentially preventing non-major acts from being buried in the listings. You can also browse by genre, which by default sorts by the most number of plays the artist has received (at time of writing, Panic at the Disco, Akon, and the Ying Yang Twins).

The sheer number of artists on MySpace Music makes casual browsing somewhat difficult, but no more so than sorting through artists’ profiles on MySpace itself. The search criteria/filters help, as they’re tailored particularly for music (by influence, genre, etc.). Still, the service works best if you have an artist in mind, instead of stumbling around.

When visiting an artist's page, users can stream music via the embedded player, which requires no additional software download and will be familiar to most MySpace users. With the new playlist feature, you can add songs you like from artists’ pages directly to your own personal playlist, and share them with your MySpace friends or place on your own MySpace profile page. For regular users, this enhanced functionality is probably the most noticeable new feature, though the playlists cannot be shared with or embedded other sites like Facebook or on personal blogs.

As for the purchasing process, Amazon.com MP3 links appear next to each song in the player (if they are available in the store). The process is quick and simple, provided you have an Amazon account and have used the MP3 store before. If you haven’t, you’ll have to go through a standard Amazon account creation process before the song will download. After the initial set up, downloading songs is simple. Perhaps most importantly, you’ll be able to play them on any device – including the iPod – as all music sold from Amazon is DRM-free.

The Rent
Under the current agreement between the four major record labels and MySpace, the labels make money in two ways. First, the labels are reported to get a portion of advertising revenue. Second, MySpace has agreed to give each of the four major labels equity stakes in MySpace Music in exchange for their participation. The specifics on how the revenue is spilt among the labels remains unclear, with all parties seemingly uninterested in revealing the details of the deal.

While MySpace Music may be the most robust attempt yet to build an ad-supported model, some questions remain. First, there has been no announcement about whether the labels plan to share the equity with their artists. FMC would hope that major label artists and their management team would be asking these questions during the next royalty accounting period. Second, it’s been widely reported that independent artists and labels – mostly represented by UK/EU’s Merlin, IODA and A2IM – were not offered similar equity arrangements. This means that many independent artists – the kind of artists that built up MySpace’s public profile and traffic – are not completely sharing in the wealth. For now, even though independent artists will be able to collect song royalties, they will not be able to collect additional revenues from the ad-supported service.

Unsigned musicians are worse off. While MySpace Music does enable the user to include unsigned acts’ music in their personal playlist, the artist has no means to collect any ad revenue or even offer their music for sale. As it stands, if you do not have an agreement with MySpace, you cannot participate in the most lucrative parts of the service. MySpace claims they are working on “opportunities” for unsigned artists to participate more fully in future. The traditional method of unsigned artists uploading music to their profiles still exits, but so far there’s no way for them to collect money from the streaming of their music.

MySpace has created the underpinnings of a potentially great service, and now they need to make some key improvements. While they should be commended on implementing a universal playlist solution and integrating a DRM-free, legal download store, the service cannot receive full marks until it puts independent and unsigned artists on a level playing field with major label talent. Until the equity gap is narrowed, the service gets a mixed review. MySpace Music is off to a decent start, but there’s more work to be done.

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