In a nod to the increasing share of music that is getting listened to via streaming platforms, Billboard has added a Streaming Songs Chart to its weekly listings. Last spring Billboard started charting top songs played by On Demand services, this list will cover those and add the songs played most by streaming services. Macklemore & Ryan Lewis holds the top spot on Streaming Songs with 1.45 million total streams in the U.S. Services included in the reporting are “such services as Spotify, Muve, Slacker, Rhapsody, Rdio, MySpace, Xbox Music and Guvera.”
The data comes from Nielsen Soundscan and Nielsen BDS data – Nielsen SoundScan measures U.S. point-of-sale of recorded music product. Nielsen BDS tracks U.S. radio airplay and music streams. Both systems power many of the Billboard charts. Nielsen recently reported that music purchases are at an all time high, up 3.1% over last year, driven by digital sales. For 2012, sales of albums and track equivalents are down slightly at -1.8% vs. 2011. Digital Albums are up 14% and Digital Tracks are up 5%. CD sales declined 13%.
Pandora meanwhile has posted a recap of sorts of last year on its blog, noting that last year listeners to Pandora created 1.6 billion stations and listened to more than a million different songs by 100,000 different artists. I’m thinking that data is probably at least as deep in terms of sample size as the stuff Nielsen is collecting…
Guvera, the on-demand service that recently launched here in the US, has gotten some early traction with big national advertisers who like the streaming services idea of building streaming channels of music around a brand.
According to a report last week, advertisers in the US include Victoria’s Secret, Microsoft, Sprint, Mastercard, Geico and H&M, all of whom have dedicated channels. Guvera Founder Claes Loberg explains that listeners are “brand loyal, taking the time to select a brand and interact with the individual channels to download their free music.” They are logging long periods of sponsor engagement double digit click through rates as well.
Guvera hails from Australia, started streaming in the US in March and is still working out licensing deals with some of the record companies. Their song library currently includes EMI Music Group’s labels; EMI, Virgin, Capitol Music, Bluenote, Mute and Domino. The website informs us that they’re hoping to add Universal Music Group, IODA and several independent labels in June and July. They are reporting 75,000 users across Australia and the US, with roughly 40,000 coming from Down Under. About 3-5,000 are joining weekly.
I like the approach this station is taking. They set out to distinguish their ad model from the beginning, emphasizing that they weren’t selling impressions but were focused on brand engagement by working with brands to create channel sponsorships. Apparently, some big brands think it sounds like a good idea as well.
While big online music services like Pandora, Spotify and others (Last.fm, Guvera, MOG…) are getting a lot of attention these days, Rhapsody is often overlooked. Rhapsody has been around longer than the others – they launched in 2001 as the first music service to offer streaming on-demand access to a large library of digital music. Prior to 2001 they were a service called Listen.com.
In 2007 Rhapsody America became a joint venture between RealNetworks and Viacom. In February 2010, Rhapsody’s owners announced their intention to restructure the company into a fully independent corporation, a move that took place last week with Viacom and RealNetworks, as well as Universal Music Group, maintaining positions in the new company.
Over the years, Rhapsody has tried lots of things, from offering songs that had to be played in their player to DRM free all-you-can-eat offerings. They’ve partnered with Verizon, Yahoo, and iLike/Facebook. The service has over 9 million songs in its library, and for a monthly fee of ten bucks they’re available for unlimited on-demand streaming. Yet, according to the LA Times, its paying subscriber base dwindled from 800,000 in early 2009 to 675,000 by the end of the year.
This week, on the heels of their reorg, Rhapsody launched a new iPhone app that should spur a bunch of new subscriptions. In addition to unlimited on-demand streaming for ten bucks, subscribers can download their favorite Rhapsody playlists to their iPhone, iPod touch or iPad so they can listen anytime — even when they’re not connected to the Internet. From their blog: “Simply launch your Rhapsody app, open the playlist and click the Download icon. You’ll need either a 3G or WiFi connection to do this initially, but once the songs are saved to your device, you can rappel into the deepest crevices of the Grand Canyon and still be able to play them back.” For ten bucks you get to do this on one device, for $14.99 you can download your playlists to up to 3 devices.
Access to 9 million tunes, streaming on demand plus untethered downloads of my favorite songs onto a mobile device. It’s the kind of thing that could make listeners trade in their ipods. (And there’s talk that Apple bought Lala to launch something similar). It really puts Rhapsody in a whole new category, but will the listeners follow? Only their history makes me wonder..
The service is not yet available in the US, but they expect to open up to beta testers in the next month or two here in the US. It offers free streaming or downloads.
In addition to lots of funds, and the most curious name I’ve heard for an online music service, Guvera has a unique revenue model. Something that, to my knowledge, has not been tried thusfar.
Guvera will sell channels to advertisers, who will sponsor channels with content that gets selected by the brands (or the agencies representing them) based on “personality”; there’s an assessment tool companies can use to determine which artists or specific songs fit their brands and target audiences best. (The actual songs are not chosen by the advertiser, but are tagged for use reaching certain target customer criteria.) Advertisers can add other criteria such as location and then set a price they are willing to pay per listener on their channels. The revenue generated is shared between Guvera and the music labels (of course). Techcrunch reports that advertisers include McDonalds, Johnson and Johnson, and Harley Davidson.
Guvera plans to do deals with all the record labels as well as movie studies and television networks, and offer all the content using the same ad-sponsored channel delivery model. They just announced a deal with Universal Music Group. David Ring, executive vice president of business development & business affairs at Universal Music Group’s eLabs, said the hope is that Guvera will attract people who simply won’t pay for music online. “What I think is incumbent on us in the new world that we’re living in is to make sure we try to segment the market,” and have something to offer the segment that’s getting its music free — and illegally — online,”
In a recent interview, Guvera CEO Claes Loberg explained that this ad model is not about cost per click or cost per thousand impressions, instead it’s about the cost of engaging a target customer. He says the service is an engagement tool for advertisers.
Engagement is the elusive goal of most advertiser’s campaigns. CPMs and CPCs are definitely inadequate standards for measuring engagement and the idea of putting the focus more on buying a customer’s attention is a good one. The challenge will be in teaching the old dogs new tricks – agency media folks like their metrics just-the-way-they-are-thank-you. Nonetheless, letting advertisers participate in selecting and pricing their audience? I’m definitely intrigued…