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Warner Music Ditches Streaming, Strands Spotify, Last.fm, Napster

Gordon Kelly

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Warner Music Ditches Streaming, Strands Spotify, Last.fm, Napster

The music industry is famously regressive. In fact, I once said that if their "industry executives were any more out of date they probably could've fathered themselves" - and this still leaves me staggered...

In a desperate, ill-thought out and frankly ridiculous decision which will not so much come back and bite it on the backside, but tear out its tailbone Warner Music has announced it is looking to unilaterally pull its entire catalogue from the streaming music sector. As a result companies like Spotify, Last.fm, Napster, Sky Songs, We7 and the US-only Pandora, Deezer and Grooveshark which offer 'free' ad-supported services will suddenly find a huge proportion of their music libraries gone.

As one of the so-called 'Big Four' record labels artists like REM, Moby, Sean Paul, Linkin Park, Frank Sinatra, Johnny Cash, Morissey, the Red Hot Chili Peppers, Oasis, Prince, The Prodigy, Guns n' Roses, Muse, Paramore, Green Day, the Flaming Lips, Fall Out boy and A-Ha are just a few of the big names Warner Music has locked down (here is a full list). On the plus side, it does hold Paris Hilton's recording contract.

"Free streaming services are clearly not net positive for the industry and as far as Warner Music is concerned will not be licensed," said Warner CEO Edgar Bronfman Jr in a sentence which should have had for us to maximise the amount of money we can make tacked onto it. "They get all your music you want for free, and then maybe with a few bells and whistles we can move you to a premium price strategy, is not the kind of approach to business that we will be supporting in the future."

Well, that's definitely the logic of a label which would sign Paris Hilton. Unfortunately Warner Music also hasn't given any specifics about its decision, so we don't know if premium streaming services will be spared or what the timescale for any withdrawal will be.

The bigger problem is that - like it or not - streaming music services are incredibly popular with consumers with Spotify one of the biggest talking points of last year. Rival labels also seem unlikely to follow Warner's decision with Universal Music Senior VP Rob Wells telling the BBC "Spotify is a very sustainable financial model - full stop," just last month. That said, any sudden loss of artists may convince the minority number of subscribers to these services (on which they rely greatly) to return to the free ad-based model and that could spell serious trouble.

Troubling times. Very troubling indeed...

Disclaimer TrustedReviews is owned by IPC Media, the publishing division of Time Warner. Clearly this greatly impacts our free speech... *cough* Trusted, remember ;)

Update: Spotify has posted an obtuse update on its twitter account proclaiming: "To be clear WMG is not pulling out of Spotify. Media is taking things out of context. So don't worry-be happy :)"

A few points here. 1. We're all referencing the BBC here, so it isn't general 'media' and the Beeb has quotes directly from WMG. 2. Not pulling out how? For premium subscribers only or everyone? 3. If we are "out of context" it would be nice to give some context...

Unfortunately since this update late last night Spotify has yet to respond to any press enquiries (including my own) or even post an additional Twitter update to much some much needed meat on these bones. Until then, we really can't know what on earth it is on about...

Link:

via The BBC

Chris

February 10, 2010, 11:40 pm

Ouch.





Sounds like they're trying to shape the industry into a subscription model and relegate free services to independent artists only. I suppose it's possible the tracks could stay on Spotify, but only available to the premium subscribers. If other studios follow suit, radical changes ahead.





Kinda reminds me of when Warner ditched HD-DVD for BluRay, and we know how that went...

Helmore

February 10, 2010, 11:42 pm

I guess Warner Music is not run by monkeys, as monkeys would have made a wiser decision.





Unfortunately Spotify is not available over here, but otherwise I would use it. This decision by Warner makes it a bit less useful though and does make pirating music the easier choice. That last part is precisely what Warner does NOT want to happen. I guess some companies just don't understand that to beat piracy, you have to give consumers an option that's easier, safer and quicker than piracy and that is exactly what Spotify is. In my opinion Spotify is one of the answers/solutions to piracy.

jingyeow

February 10, 2010, 11:44 pm

This is interesting. Spotify must be a very poor revenue stream to simply give it up without an immediate replacement in mind. Perhaps Warner are going to revolutionise the music industry and bring out the PERFECT business model for earning money on music.





Out of interest, if a record label does "go under" what happens to all the Intellectual property? Does it revert back to the original owners (the artists) or does it go to the creditors?

xbrumster

February 10, 2010, 11:59 pm

WM is so lame.





I may as well just listen to radio from now on. free with restricted choice, I can bottle that. Or illegal downloads, they dont make any money at all in that sense.

Ohmz

February 11, 2010, 12:02 am

Looks like Spotify isn't coming to N. America anytime soon. And even if it did, why would I want to use it now?





Looks like the record labels still don't get it.

Occam's Razor

February 11, 2010, 12:09 am

Watch someone stick the entire Warner catalogue up on Torrents/Newsgroups. Their Achilles heel is the relatively small file size of music.





High quality streaming at a flat fee of £5-10 per month is the only option these guys have. The game has changed.

rav

February 11, 2010, 12:12 am

Bad news for everyone but I still do think that Spotify is over rated.





Would love to see Pandora come to the UK. From what I've heard it's great.

Hugo

February 11, 2010, 12:16 am

Paramore! Fall Out Boy! Panic! at the Disco! Nooo!!

lifethroughalens

February 11, 2010, 12:22 am

"Disclaimer TrustedReviews is owned by IPC Media, the publishing division of Time Warner. Clearly this greatly impacts our free speech... *cough* Trusted, remember ;) "





Oh come on guys, falling on your sword is a much more honourable thing to do! (and a lot more interesting for the reader :) )





I don't know why, but this news doesn't even slightly surprise me. Whilst the industry continues to shoot it's toes of one by one, the rest of the World will go about accessing their entertainment by the course of least resistance.

Gordon394

February 11, 2010, 12:42 am

@ravmania - Pandora was in the UK! It was forced to pull out... check the associated stories link ;)


@Hugo - you're just obsessed with Hayley Williams!


@lifethroughalens - You do realise I was being ironic, right? Beside, I'm not so much a fan of falling on swords, more a fan of swinging them :p

Guest

February 11, 2010, 12:50 am

Looks like the music industry will only learn when the bailiffs come round and close them down. After they alientated a lot of their customer base with all the DRM nonsense you thought they had finally seen the light. Clearly not.

Paul 32

February 11, 2010, 1:00 am

I signed up for the Spotify Premium last month as it was clear I could not buy every cd I wanted to and I should not be using illegal methods aslong as there is a decent paid alternative.





I hope warner does not pull out from the paid spotify (will they sell their share too?). If they do and the other three labels stick with it then I think the solution is clear: I will stay with spotify and continue to purchase non-warner cds as I can, but I will not buy or download anything just because it is not available on spotify.





Given just how much spotify free is used by the younger generation I imagine this will have a similar effect on them - if they dont find out about artists from spotify they wont buy the albums. But then I guess aslong as this forces some users to buy what they otherwise wouldnt have then Warner wont care.

Beaky69

February 11, 2010, 1:36 am

Hey, don't diss Paris Hilton...from what I can gather, she's very orally talented ;)

Xamph

February 11, 2010, 1:42 am

Looks like Spotify now knows how Toshiba feels... :-(

Max

February 11, 2010, 1:47 am

Idiots

DrDark

February 11, 2010, 5:29 am

Well done, Warner. At least 50,000 people just logged onto their favourite torrent sites and started grabbing your artists' albums. Yes, I did just grab the number out of thin air, but I think there's a possibility it's true.





I noticed the music industry's annual report (can't remember its official name) said CD sales were down. What, did they think doing this would bring them back? Casual "filesharers" download stuff to try out albums, streaming stuff meant they had no need, but now they'll just grab the whole album and not bother buying at all...





Anyway, I'm preaching to the choir here. Need some kip. G'night.





P.S. @Occam's Razor: Cool name ;).

TechnicPuppet

February 11, 2010, 6:13 am

I signed up for spotify premium, then canceled it due to their point blank refusal to release a version I can use with a remote from my couch, or open it enough to let someone else do it right.

elwood p

February 11, 2010, 1:52 pm

Oh well, looks like its time to re-install silverjuke on my living room pc.





Spotify had become a great choice for get-together's at my place, especially with the ability to 'go premium' for one day.





I think many people will just continue to use spotify and download illegal copies of any Warner music they really want. Don't really see the benefit to Warner from that.

Dorian Knightley

February 11, 2010, 3:00 pm

Spotify should make it possible to intergrate music on your hard drive into the same environment as music being streamed so you don't need to open a new application to play something which is not available to stream. There is already so much that's not available on Spotify and now with Warners pulling all their music, it makes sense to enable users to mix between Spotify and stored music on the fly. (I know it's not exactly relevant to this post but it would make things a lot easier, especially when using spotify on a phone...)

Simon

February 11, 2010, 3:29 pm

Oh dear. Exceedingly poor understanding of how to server their customers on Warner Music's part. At least the other labels don't seem to be wanting to follow in their footsteps. Maybe if the big labels keep acting like d*cks we might see some of the smaller indie labels succeeding after having a better understanding of the market.

Thomas204

February 11, 2010, 7:16 pm

Nooo! Natalie Imbruglia :'(

Siebenstein

February 11, 2010, 7:59 pm

hmmm, I've read nothing about paid subscription services like Napster in the source link. Also, from what it looks like, Warner isn't pulling its content right away.





My 2 cents: I agree with Warner when they say that ad-supported free streaming music is not a very good business model. And please, quit the whining; "they don't get it" translates to "I want free music! If you don't give it to me for free, I will steal it!"

Guest

February 11, 2010, 8:15 pm

@Siebenstein, I would say that because of the Music Industries inability to embrace technology over the last 10 years or so the culture of "free" music (legal or not) has become the norm for many, certainly in the younger generation. Changing such a culture is going to be very difficult to change now. It is not whining to say people will just steal it, it is fact! They already do and will continue to steal! Things like Spotify were a chance to get some of the "thiefs" back. Sure it is better to get some money rather than none at all?!?

Simon

February 11, 2010, 9:36 pm

Update: They won't be puling out of the existing deal with Spotify in Europe.

Simon

February 11, 2010, 9:42 pm

Oh just seen Gordon's update. In future: Read first, comment second. D'oh!

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