eMusic is old-school, OG MusicTech.
It was 20 years ago (1998) when the company launched as the “first ever legal, digital music store.” If you’re curious, the iTunes Store launched in 2003. eMusic has made its bones off of a mixture of discovery, music locker, downloading center, and a “take it anywhere in the app” cherry on top. The monthly subscription price that included a certain number of tracks for download had a unique position among competitors. If you stopped paying the subscription you still got to keep the songs. Compare that to, say, if you stop paying Spotify $10, poof! all of your music goes away.
eMusic has always been a champion of the independent artists, although it has tried to lure the majors from time to time and unfortunately took a lot of heat (and losses). But a company based on downloads can read the tea leaves and see that the market is shifting to streaming.
Here’s the interesting thing to me. I’ve covered lots of companies launching a digital service (DSP) on blockchain, but I have not seen one transfer its whole offerings to one. Certainly, eMusic is the largest established player making this move, which may lead the way to broader adoption. eMusic is also planning to raise a $70m ICO offering on its proprietary Ethereum-based ERC-20 token called eMU.
Another differentiator in what eMusic is trying to pull off is that the company wants to offer its blockchain-driven solution to other DSPs. Think of it as Blockchain as a Service (BaaS). So, you would load your music onto eMusic and then it conceivably could be distributed through blockchain ledger transactions to all of the DSPs (Spotify, TIDAL, Apple Music, etc.) if they wanted to adopt this new system, rather than build it out on their own.
Set aside what my thoughts on all of this blockchain, ICOs, crypto, tokens, transparent ledger stuff means to music (it’s problematic to say the least); the important thing for you to understand is that literally hundreds of millions of dollars are pouring into this space–your space, where your music will be– so pay attention.
In 2015, the company was purchased by TriPlay, an Israeli media cloud startup founded by Tamir Koch, who is now the CEO of eMusic. We discussed the future of streaming and eMusic’s plans to launch a blockchain solution for the industry.
I like to start out asking leaders music companies about their background in music; did you play, write, or sing, or are you just a fan?
I can’t carry a tune; my ex-wife was a singer, so my kids are unbelievable. None of it came from me. My mother was also an amazing singer. So, I guess I’ve always surrounded myself with those who make beautiful music.
Talk to me about how this new direction eMusic is taking came about.
eMusic has always been known a retail storefront and still the champion of indie, classical, and jazz. TriPlay acquired eMusic three years ago because of its brand and loyal fans. Our plan was to turn eMusic as a download store into an actual music service with subscriptions. So, we did that last year. Now, 62% of the market is streaming. You used to perform live in order to sell albums, now you try to move streams in order to promote performances; but those who don’t tour can get money for their artistry. So, instead of using the tired model of just streaming which we see kills companies–Spotify can’t turn a profit at 70/30 splits and iHeart Radio just went bankrupt–our aim was to fix the problem on the company and artist side.
Where does the money go? It gets lost in-between all these intermediaries and we are trying to strip that away to let artists upload direct, and get paid directly, almost instantly. Let’s leverage the open cloud for blockchain technology to increase payouts and transparency, then let’s introduce a token that gives music purchasing more power and value, then let’s offer it as a distribution platform for indies cutting out the middleman and as a service platform for any digital music service that wants to stream.
In general, tell me about your view on downloads. Do you think iTunes will close up shop? Is eMusic committed to them?
I can’t comment on Apple. I know they are fighting Spotify for the dominance; I do not think that model of streaming-only is sustainable. There are hundreds of millions who still want a collection and we want them on eMusic. 80% are listening to their own collection and get 20% new from us.
Do you have some eMusic numbers to share?
Well, we have around 1 million uniques per month, eMusic has served over 467 million customers, and we currently have over 26 million tracks available.
How does the platform work with PROs and SoundExchange?
We are working through these issues and of course, this is a large undertaking. Royalty management with micro royalties in the smart contract and those got to wherever they are assigned. The difference is, it will be much faster and most importantly, transparent.
Can eMU be exchanged for fiat; cashed out for dollars, or only used in the eMusic ecosystem?
Yes, there will be an option to trade to fiat, but our purpose is to build an entire ecosystem where better value is gained as a member of eMusic and as an artist (or asset holder) in exclusive offerings, crowdfunding, and more. There will be secondary offering as well. Ours is the only project that I know of where our token will be available to use the day it launches.
How will this change eMusic today — can I still download?
Absolutely. eMusic wants to be your music destination. We know that there are still lots of people who believe in building a collection, and we will still house that and serve that to you anywhere. I can tell you that Hi-Res downloads are coming to eMusic. The blockchain and token will enable new models. Maybe you charge for every 5 plays, maybe you let the user download after paying for 10 plays, it’s up to you.
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ABOUT THE AUTHOR
–Michael St. James is the founder and creative director of St. James Media, specializing in music licensing, publishing, production and artist development.