who’s really number two?
This morning I read with some surprise in USA Today that Amazon is “No. 2 in digital [music] sales since opening nearly six months ago.” Amazon’s entry into this market last year was an important milestone in the continuing irrelevance of DRM and the overly restrictive and anti-consumer policies that the music industry has foolishly wielded in this new, digital age. But let’s get one thing straight: outside of iTunes, no one sells more music digitally than eMusic, and we don’t plan on giving up that title anytime soon.
So how is it, we wondered, that USA Today came to name Amazon No. 2? After talking to USA Today, we learned that:
1) USA Today called representatives of the four major labels, who declared Amazon to be only behind iTunes in sales.
2) USA Today believed that our subscription model was not relevant to the story they wanted to tell.
I’d like to address both of these points. First, allow me to point out that no sales or market share figures were cited in the USA Today piece. In fact, the article states that Amazon “won’t say how many songs Amazon has sold but will say that consumers love the experience.” Is that enough for USA Today to make such a bold pronouncement, particularly when there is plenty of widely available evidence to the contrary?
While Amazon isn’t willing to make sales data available, we are more than happy to: eMusic sells more than 7,000,000 songs a month. Seven million tracks of independent music covering everything from Cat Power to Miles Davis. Since Amazon opened its MP3 store on September 25, 2007, eMusic has sold 40,000,000 tracks. Since November of 2003, we have sold almost 200,000,000 songs. These are huge numbers, and firmly back our claims to be the #1 site for independent music and the #2 digital music service after iTunes. Those declarations have not previously been disputed.
USA Today overlooked the vitality, importance and amazing growth of independent music in the writing of this article. Independent music makes up just under 30% of the music market in total (but more than 40% digitally), more than any of the individual major labels, and it encompasses so much incredible, vital music that is by and large ignored by the mainstream media. These labels and artists support themselves through devoted networks of music consumers, the kind of people who are still willing to pay a fair price for an album or song — or, as we like to call them, our customers.
There is a much larger world out there beyond the major labels, and eMusic has been waving that flag for ten years, breaking new artists, reinvigorating our customers’ love of music and, again, selling more than 7,000,000 songs a month. We are proud of our achievements, and believe that their omission in this article displays a continued lack of awareness of just how much amazing music happens outside of the mainstream spotlight.
As for USA Today’s claim that our model is not relevant to the story, there’s a problem with that, too. Let me explain what eMusic does. Yes, we are a subscription service, but we are a download-to-own subscription service, more akin to iTunes than Napster or Rhapsody, which are predominantly streaming or rental services. At eMusic, our basic plan is $9.99 a month for 30 MP3 downloads. These are unprotected files — which we have sold since the very beginning — that our users are free to burn to CDs, move to any media device, etc. You can be sure that our sales figures were included in the 239 million digital tracks sold this year, attributed in the story to Nielsen Soundscan.
The only distinction between us and Amazon — aside from our service being more affordable — is that our users essentially prepay for those songs each month. This helps artists immensely, as it enables our customers to try out someone new, and to spend more time and money on artists who traffic way outside of the commercial mainstream, who make music not for fame or glory, but because they feel compelled to. This is why we got into music in the first place.
Again, none of this is at all meant as a slight on Amazon. They have been a pioneer in the world of ecommerce, and we respect the empire that they have built. But in terms of digital music, we are still on top, and will continue to be so. If we ever decide to start selling blenders, we’ll be sure to give them a call.
David Pakman, President and CEO, eMusic
I like your spirit, David.
There is a wide world outside major labels and there is also a wide world outside the USA. As an Australian I cannot access Amazon MP3 downloads at all. I believe that also applies to Europe. The fact that eMusic makes all this music available (more or less, obvously the labels place some regional restrictions on some things) globally is a great mark in eMu’s favour.
When I asked my friend what she thought…
“who even reads usa today? you get it free at the hotel and throw it away?”
“goes to show that mainstream media can’t venture off their beaten path. but that’s why emusic is here, cause music listeners want to do just that.”
to be fair, she’s in PR.
I’m not resorting to sentimentality or hyperbole when I say, “eMusic is #1, because it actually changes lives.”
Let me just say that I fit the coveted 18-35 market that you could use to measure corporate music service success by, but my father, a retired biologist has rediscovered his love of music since I turned him on to eMusic. Long story short, he sends me new music every week that he has “discovered” through the combination of brilliant editorial, train-of-thought social exploration, the pricing schema on emusic makes people feel comfortable to explore, spend time with, and learn to love new types of music because they lower the risk of that exploration through this unique combination of features.
I can say that having access to artists like William Basinski, Nigerian Highlife Collections, or out of print indie rock would be economically unfeasible, given the price tags of $24 dollars or more…and I would have had a hard time acquiring those types of titles without emusic.
Thanks for the great service and access to beautiful music that major labels buy up long after my father and I have discovered it through eMusic, making every other service second in my book.
“Who are you?” “The new Number Two.”
“Who is Number One?” “You are… Number Six.”
“I am not a number — I am a free man!”
You miss the point, David. Amazon and iTunes have a wide variety of music; you have a wide variety of noise. As an older listener, I find very little on eMusic that comes close to touching my musical interests.
Guess it’s time to reconsider my eMusic subscription
How odd. What are your musical interests? My musical tastes skew to areas other than indie rock too(jazz, blues, country, crooners, folk, “world”) and find more music than I can possibly ever listen to.
If by “noise”, Jim, you mean interesting, innovative, groundbreaking, refreshing music from a wealth of independent labels and artists who still matter, then you’re probably right. eMusic is my favorite noise in the world.
To each his or her own, I guess. Amazon has a great model, but one that is ultimately dictated by the majors. Just as they did all the years they had the whole music business model by the balls.
There’s also the lack of major label releases on the site, and to that I’ve always said “oh well”, whatever a major DOES release that I’m really REALLY interested in, I’ll buy the CD, most probably used.
I’ve been an eMusic subscriber since 2002, and continue to find awesome music there each month.
Um, Jim Wickman, I think you miss the point. The point was about the number of downloads. This quantifiable number has nothing to do with your opinion about the quality of that music.
Perhaps more importantly, why do you continue to subscribe to a service you don’t like? Is it because you are retarded? Because I agree with you - emusic definitely underserves that particular demographic.
I love eMusic it’s like rummaging through a good record shop and turning up gems every time, there is so much good music on the site,and as mister T would say “i pity the fool” especially the ones who cannot find anything to listen too.
Well said, Mr. Pakman! Last winter I attended the eMusic subscriber/focus group in Chicago. Your passion for cutting-edge music and it’s distribution are impressive and very much needed these days.
Personally, I discover both obscure and mainstream items constantly. I’ve got tons of music waiting to be downloaded. I’m currently a 100 download/month subscriber and am seriously considering an upgrade!
I couldn’t be happier with your service or the site. Thanks for watching out for the little guy.
You tell ‘em David. Don’t let eMusic get crushed by the machine. To borrow from a tacky McDonalds ad: eMusic - I’m loving it!
@Jim Wickman,
This has been mentioned before but 2 major points: why do you subscribe to a service you don’t like and what are you considering “noise”? The classical stuff? Jazz? Soundtracks? The 60s/70s rock (including live gigs) - assuming you don’t like the hundreds of new bands that appear every week? The wide selection of soul and reggae? None of those genres are exclusive to age group (unless by being an “older listener” you mean “not interested in finding anything you’ve not heard before”, in which case point taken).
@David Pakman: Well said. It’s a shame that such shoddy reporting is allowed to go on. In my opinion the “research” they did was akin to calling up a few major movie studios for their figures and then guessing that Juno wasn’t successful because nobody mentioned it. Shocking and utterly inaccurate. I’ll wager that they don’t print visible retraction after you’ve corrected them either.
This kind of behaviour makes me concerned for the future. I such a long-running and successful site like eMusic gets the short end of the stick, what chance do interesting newcomers like WE7 and AmieStreet have?
As an artist who sells their music on eMusic, I can tell you that they pay the absolute LOWEST rate per song of any digital music retailer. It’s ridiculous. Before long, the payable mechanicals will cost more than the wholesale payments received. David Pakman, you need to SERIOUSLY look at your business model and reassess before it’s too late.
So, don’t put your stuff on eMusic then.
@Phillip Jeffries: As Amanda said, if eMusic isn’t a good economic proposition for you, you shouldn’t use it as a distribution mechanism (or you should lobby your label not to do so). Obviously if the mechanical royalties end up higher than the payouts then you don’t definitely want to be on eMusic. Less obviously, you shouldn’t be looking at per-track payouts, you should be looking at total profit from all downloads. If eMusic ends up driving more downloads for you than you’d have if you weren’t on eMusic, if you’re making a profit on each one, and if eMusic sales aren’t cannibalizing sales through other channels, then arguably it’s good business for you to distribute through eMusic.
eMusic sales are potentially profitable incremental business to price-sensitive customers you might not reach through other channels (exactly because they’re price-sensitive and they don’t want to pay $9-10 per album). I’ve done a number of posts about this on my blog, including discussions of how labels could use release windows and other mechanisms to optimize eMusic vs. non-eMusic sales. (For example, put releases on eMusic only after you’ve made them available through the iTunes Store and Amazon for a few months.)
@Philip:
Lowest rate paid per song because they’re the lowest price per song. The question isn’t how much raw revenue you’re receiving through eMusic, but rather how many people who have downloaded your music through the site would have done so otherwise.
The fact that eMusic’s prices are so low allow people without a huge amount of spare cash to be more adventurous and thus download albums we would never have touched before. With eMusic, you may have more fans who may be more likely to buy physical goods, concert tickets, etc. Without eMusic sales you may have someone who has never heard of you and will buy nothing instead.
As far as I’m concerned Emusic is the only one selling what I want to buy.
Re: my comment @ #15, I don’t want to sound like I am unsympathetic to the artists. I’m not and I sympathise with all the current challenges. I support musicians wherever I can and support them in anything they want to do to make it work. I’m sometimes disappointed when labels don’ t put stuff of eMu or pull out or whatever but I’ve never questioned their right to do it. Labels and artists should organise their business affairs however they see best for themselves. I don’t expect them to be charities, but I’m not a charity either and I have to organise MY financial affairs in ways that make sense to me. eMusic offers what I want to listen to at a price I will pay ( … and pay and pay and pay, over a long time.)
There is the occasional new release I get on eMu I might have gone out and bought copy of in the old days, but actually not that many (and I still do buy new CDs). Where eMu has cut into my spending on hard copy discs is in second hand. I used to buy a couple of second hand CDs every week, at least, on eBay or in shops. Can’t think when the last time I did that was. So, from a position of the artists/labels directly getting NOTHING for the bulk of my music purchases now they do get some money.
And that doesn’t include the future spending on music, concerts, merch down the road for the literally dozens and dozens of acts I have only discovered because of this, all of whom I have evangelized to my friends and often random strangers.
By all means, don’t use eMusic if it doesn’t work for you but lashing out at a LEGAL service which targets the most serious music fans is really , well, dumb. I recall a year or so ago a jazz label pulled out and in doing so the basically called us thieves for dl’ing the music at this price. Way to alienate the people who are going to save your business and your livelihood if it can be saved.
If Phillip can direct us to his music on eMusic, he might get a few more sales out of it!
Well put, Amanda.
Wow, Amanda well Put I was going to put relatively the same thing but you put it very pretty not icky/ugly like my posts usually are.
While I’m not sure what eMusic pays to their artists, I’m a Music Studio and have been trying to find that out for years pretty much since we made it Crystal to eMusic that we demanded artists were paid (back in the day y’know 2004 or something, when they left the all you can eat model). I do know that the price model for the lowest subscription rate (no I’m not cheap just broke and only charge my artists a meager amount (read $50/song as opposed to $80 /Hour) compared to other similarly built studios) is $9.99/month for 40 songs (call it $10 flat for math) that’s $0.25/Song as opposed to $0.89 /Song the Big companies charge. (EDIT i seem to be grandfathered into the 9.99/40 so new lowest figures are $0.30/song)
so, Mr. Jeffries, you gotta figure that in with your “I can tell you that they pay the absolute LOWEST rate per song of any digital music retailer.” And as the Beautiful Amanda (OK so I don’t know she’s beautiful but still) said don’t sell your music through eMusic if the lack of pay you get outweighs the amount that musical press and advertising execs/cronies are paying to eMusic to maybe discover your songs and use them. I make the above statement only based on conjecture stemming from the fact that soooooooooooooo many eMusic artists keep popping up in television and commercial soundtracks and that many movie soundtracks for many major motion pictures end up on eMusic and made out of a piecemeal of eMusic artists.
See I told you my posts are ugly tl:dr (google it if you don’t know what it means)
MiDoJo
(Brought to you by Carl’s JR.)
doh the blog prog used by 17dots ate my plus symbols please reread my post with $80 /hour reading $80 plus/hour and $0.89/song reading $.89 plus/song
this blog prog is a /b
I hate that I’m now not only double posting but triple posting but 17dots ain’t got no edit post button so I say to all of you “Sorry, but I thought this to be important.”
With the help of Frank’s Blog I found this article that pretty much shows how much eMusic is paying out and It’s really really really close to the number they are taking in. Here is the link: http://digitalaudioinsider.blogspot.com/2007/11/increased-per-song-payouts-from-emusic.html .
@Amanda:
Well said. The fact is that so many of the artists (who rarely seem to mentioned their recording names or available albums when complaining like this online) don’t see the big picture. I was in a similar positions to you - I’d gone from spending £30 per week on music (I was a DJ for a few years) to virtually nothing. What I did buy was generally from second hand stores or eBay, so while I was still enjoying music, the artists saw nothing unless they happened to play live near me.
When I joined eMusic, everything changed. I now buy a minimum of 7-8 albums per month, discovering new artists and getting into new genres I’d never been into before. The reason for that is simple - the subscription model and the price. I buy so many albums because it’s cheap. I delve into new genres and artists because I would spend the same each month whether I download or not, so why not experiment?
I can sympathise with artists looking at the royalties from eMusic and concluding they’re low but I say look at the bigger picture. Sorry to hammer this point in again, but you’re not necessarily gaining money as an artist by moving away from eMusic. Try to work out how to leverage the exposure you’re getting there instead.
The other small lesson is this - at the end of the day, consumers will choose the best price for music and this is getting lower and lower. But, moving to a higher revenue service does not mean that the consumers will follow. I used to buy every release from the Global Underground label, but since their aggregator (Vital:PIAS) left eMusic, I haven’t bought a single release. Why? I’m already spending a lot of money on alternatives at the site and can’t justify buying more expensive albums. Do what you want with your music, but if you depend solely on the royalties you’re going to be screwed eventually. Leverage the new fans into something else, and you’ll profit.
Now, upgrade eMusic to 256kps VBR Mp3?