The cable programming giant has sold its Harmonix unit, which published the game, to investment fund Columbus Nova LLC. It hasn’t disclosed a price, and if it’s not material it won’t have to. And my guess is that it won’t: Viacom bought the games business for $175 million in 2006, when the games were on the upswing, and if I had to bet, I’d say it will end up selling it for less.

Let’s take a minute here to point out something obvious, but which we always seem to forget–media consumption trends move very, very fast. You only have to go back two years to find Warner Music Group’s Edgar Bronfman Jr. demanding that the music labels get their fair share of the “enormous opportunity” the games were creating.

And just a year ago, (some) people were convinced that a special Beatles version of Rock Band was going to be a very, very big deal.

Now gamers are on to something new: Microsoft’s Kinect, for instance, seems to be selling very well this month. But I wouldn’t bet on it staying hot a couple of years from now.

So says Billboard’s Ed Christman, who has been talking to label executives familiar with Google’s (GOOG) proposals for its yet-to-be-launched service. The music industry hasn’t agreed to any of this yet, so the gap between “like to” and “will be” could be significant. But it’s worth reading Christman’s piece to get a sense of what the Google guys are looking for.

In short:

• Google would like to sell music a track at a time, just as Apple’s iTunes does.
• Google would like to give users the ability to listen to any track all the way through, at least once, as MySpace Music does, and Lala did before Apple (AAPL) acquired it and shut it down. Google’s music search service provides free full plays for some songs but not others.
• Google would like to offer a $25 a year “locker service,” where any music you own, no matter where you procured it, would be stored on an Internet server. You could then listen to a stream of the song no matter where you where, via a Web player or a mobile phone.
• Google would like to let subscribers share their music with their friends, allowing them to listen to a song a single time.

All of which sounds pretty good. And all of which sounds like concepts that the labels would be fine with, in theory–even the part about letting you access songs you “shared” via P2P services.

The sticking point, of course, will be money: How much will the labels demand up front, how much will they charge per user or per use, and how will the money be split up between different rights holders?

The last part is a question that often gets ignored when people start spitballing ideas for music services, but it’s crucial, because music rights are a complicated web that tangles up even the best intentions. Even if the “labels” agree to Google’s terms, that likely won’t be enough, because the “labels” don’t usually own songs outright–any given song or catalog may have multiple owners.

That’s not a problem if you simply want to open up another download store, or even a streaming subscription service, because there’s a broad consensus about how to split up the pennies that those generate. But with something new, like the locker/sharing proposal, there are a lot of cats to herd. Which makes this stuff interesting but far from definitive.

Probably not at Apple’s newest product launch next week. But music executives say they do expect a big overhaul of the iTunes music store. And we could see that next Wednesday. Think social, not streaming.

Industry executives tell me Apple (AAPL) has yet to approach the big labels for new license deals, which they say Steve Jobs and company would need if they want to run a streaming “locker” service. But Apple can do interesting things at iTunes without new label deals.

Apple plays its cards close to the vest even with the music labels it works with, so the people I’ve talked to are making informed guesses. That said, music sources tell me they’re expecting a lightweight, Web-based version of the iTunes store. The new version would be designed to synch up easily with the rest of the Internet and make it much easier for customers to share their musical tastes (but not songs) with friends.

Right now, you can get to the iTunes store only by using a downloaded program on your Mac or iPhone/iPod/iPad. But a Web-based version would allow buyers to get there without having to quit other applications. And if Apple makes it easier for services like Twitter and Facebook to link into the store and share recommendations, playlists and the like, then you can imagine some pretty interesting possibilities.

“There’s a reason Steve Jobs calls it an iPod–he thinks you listen to music by yourself, on your headphones,” says a label executive. “But lots of people like to share music, and if this lets you do that, that’s exciting.”

Some label executives also speculate about a wireless system that makes it easier for you to manage iTunes purchases. In theory, Apple could make it possible for you to move a copy of a song you bought on your iPhone onto your laptop without having to manually connect the two devices.

Apple’s license already allows users to synch their music on five devices at a time. So that wouldn’t require a new deal, just new technology. But it’s not the “jukebox in the sky” that many techies are eager to see.

Caveat: It’s possible, but not probable, that Apple goes ahead and launches a more ambitious locker/streaming service without the approval from labels.

That’s what small start-ups like mSpot are already doing. And subscription service eMusic has announced that it will launch its own locker service next year, and that it doesn’t plan on paying the labels any additional fee when it does.

But Apple is working very hard to persuade big media companies to let it sell their stuff. (It intends to announce a TV show rental service next Wednesday, though industry sources say most of the big networks still haven’t signed on.) Launching a new product while the labels squawk doesn’t seem to be a great way to go about it.

[Image credit: ExplorePAhistory.com]

Billboard also cites sources suggesting that Spotify still hopes for a U.S. launch this year. But Spotify has been hoping for/promising a U.S. launch for so long that there’s a Tumblr site dedicated to cataloging those unfulfilled aspirations. It’s called Not-ify.

What gives? Ask around and you’ll hear two different theories about the holdup. They’re not mutually exclusive:

• Spotify wants to replicate the model it has in Europe, where users can listen for free, then pay for upgrades like mobile and/or ad-free access. But the labels are no longer interested in supporting free streaming sites: Now that Lala and Imeem have gone away, the only free on-demand service in the U.S. is News Corp.’s MySpace Music, and they don’t seem that enthusiastic about that one.
• Spotify has raised a big pile of money from VCs, and the labels are demanding a big chunk of that for themselves.

I’m also not clear whether the holdup is with all the labels, or just some of them. Sources close to Spotify have hinted to me in the past that the company has had deals in place with some of the big four music labels for some time but was waiting to lock up at least three of them before launching.

Then again, those same sources suggest that Spotify is willing to avoid the U.S. altogether if it can’t get the deal it wants. Choose the story you like, I guess.

Meanwhile, if you’re itching to subscribe to a music service that lets you listen to all the music you want, without ads and on your PC and on mobile devices like Google’s (GOOG) Android handsets and Apple’s (AAPL) iPhone, you’re in luck! There are plenty of options.

Go ahead and try any of the following, which offer more or less the same stuff, at the same $10 a month price point:

• Rhapsody
• MOG
• Rdio (still in beta)
• Thumbplay

$10 a month too much? Okay. Best Buy’s (BBY) Napster offers an ad-free, all-you-can-eat service, without mobile access for $5 a month. Meanwhile, MySpace Music, which is co-owned by News Corp. (NWS) and the labels themselves, remains free and ad-supported. And the company’s line is that will remain so (though it doesn’t rule out a paid option).

You may be able to get that via Google (GOOG) and Apple (AAPL) one day, and both companies have talked about the idea with the music industry. But in the meantime, mobile entertainment start-up mSpot says it can offer the same thing.

The basic idea: You can take any music you own, as long as it’s in an unencrypted file format, and move it to mSpot’s servers, then play it back on different devices–your PC, your phone–on demand. The service is free for the first two gigabytes of music you upload, and mSpot charges for more storage: An additional 10 gigabytes (the equivalent of 8,000 songs) costs $2.99, and 100 gigs (80,000 songs) goes for $13.99.

One big caveat: The service, which Google showed off at its developer conference last month, supports only Android handsets. So this won’t get your music to your iPhone, at least for now.

Another big caveat: MSpot doesn’t have licenses with any of the big music labels. CEO Daren Tsui says his company doesn’t need agreements with the labels to let users stream music they own from the cloud, but Big Music disagrees. So unless they can reach an agreement, Tsui and mSpot could find themselves fending off a lawsuit like the one EMI filed against Michael Robertson’s MP3Tunes, which offers a similar service.

However, mSpot’s biggest challenge probably won’t come from the labels, but from competitors. Tsui is basically offering the “iTunes in the cloud” scenario that people would like to see from Apple, but without Apple’s cooperation. If Apple gets around to offering its own version, that would make it awfully difficult.

And Google seems even more interested in launching its own version of the same service, but without mSpot’s help. At the same Google I/O conference where mSpot launched in private beta, Google announced it had acquired Simplify Media, which makes software designed to stream music to mobile phones–news that took the mSpot people by surprise.

But those are future-tense moves, and mSpot is open to the public this morning. Will that be enough of a head start?

Less than two days after pulling books published by Macmillan in a dispute over e-book pricing, Amazon has conceded.

The world’s dominant e-commerce company says it has agreed to Macmillan’s demands to sell its e-books at a higher price–and in doing so, has made a tacit admission that e-book prices will rise across the board.

That’s because most of the industry’s big players have embraced a similar plan, advanced by Apple (AAPL) to support its iPad launch, to sell e-books for $12.99 and $14.99 instead of the $9.99 Amazon (AMZN) had been pushing.

In an extraordinary statement published on Amazon’s site, the retailer says that it “will have to capitulate and accept Macmillan’s terms because Macmillan has a monopoly over their own titles, and we will want to offer them to you even at prices we believe are needlessly high for e-books.”

No word yet from the other big publishers that have sided with Apple in the e-book pricing war–Pearson’s Penguin Group, News Corp.’s (NWS) HarperCollins, Hachette Book Group and CBS’s (CBS) Simon & Schuster. But keep in mind Steve Jobs’s all-knowing pronouncement about Amazon and Apple e-books: “The prices will be the same.”

Also bear in mind that publishers will actually make less money with the Apple pricing plan. Under the old plan, they sold books to Amazon for around $15 wholesale, and Amazon took a loss in order to retail them for $9.99. Under the new plan, the publishers will get closer to $10 per book.

But the publishers are so freaked out by the parable of the music labels, in which Apple replaced $15 CDs with $1 songs, that they are willing to take the hit in order to maintain some control of their digital pricing.

Odd as this sounds, there’s logic to it, since e-book sales will be small for some time and publishers think that this strategy will help keep the prices up when buyers really do embrace digital.

(Aside: The notion that digital pricing should be dirt cheap simply because it doesn’t cost publishers–or music labels, or Hollywood studios, or whatever–very much to distribute bits, is facile. If you don’t believe me, try ordering a vegetarian entree the next time you go out to dinner, and then tell your waiter you refuse to pay full price because you know that vegetables cost much less than meat. It may be dumb for publishers to try to keep digital prices high, but it’s equally stupid to demand that they lower them on principle.)

It will be interesting to see what Kindle buyers make of the impending price hike, particularly since so many of them are price-conscious consumers who prefer to pay nothing at all for their books.

UPDATE: That was quick: Amazon has conceded to MacMillan’s demands.

Amazon (AMZN) sells most e-books for $9.99 or less, and Apple (AAPL) plans to sell e-books for 30 percent to 50 percent more. How long can this disparity last? It won’t, Apple CEO Steve Jobs told Walt Mossberg on Wednesday: “The prices will be the same.”

The implication of that comment is clear: Jobs believes publishers will use Apple’s e-book store as leverage to force Amazon’s prices up.

As I noted earlier, this is an inversion of Apple’s relationship with the big music labels, whereby it demanded that those companies sell their songs as $1 singles instead of $15 CDs–and helped accelerate the industry’s demise along the way.

In that scenario, the labels had no option but to play along, because Apple controlled the digital music market. Here, Amazon has the clear lead in digital books, having sold “millions” of Kindles, but the market is still nascent, so the retailer’s lead alone isn’t enough.

But Amazon does own the market for physical books sold on the Web, so pulling those off its virtual shelves is powerful leverage indeed.

Next step: Keep an eye on books from the other four publishers Apple touted during Wednesday’s iPad launch: Pearson’s Penguin Group, News Corp.’s (NWS) HarperCollins, Hachette Book Group and CBS’s (CBS) Simon & Schuster.

All of them are selling their wares through Amazon for the time being. Wonder how long that will last.

Below, Kara Swisher’s video of Mossberg’s chat with Jobs following the iPad debut, in which the two men discuss the brewing book war.

]]> http://allthingsd.com/20100130/the-apple-amazon-book-war-heats-up-and-claims-macmillan-as-a-casualty/feed/ 0 http://allthingsd.com/20091123/spotify-expands-its-mobile-reach-but-still-hasnt-landed-in-the-u-s/ http://allthingsd.com/20091123/spotify-expands-its-mobile-reach-but-still-hasnt-landed-in-the-u-s/#comments Mon, 23 Nov 2009 13:36:42 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=13183 Another expansion for Spotify, the much-hyped European streaming music service: It’s now going to be available on Nokia (NOK) phones and other handsets that run the Symbian platform. That’s good, because the service is supposed to work best as a mobile play.

But Spotify has yet to make a key expansion: To the U.S., where the big music labels worry that consumers will love everything about the site except paying for it. That’s bad, since Spotify is supposed to work best as a subscription service.

Most Americans have never heard of Symbian, though it remains the biggest player in the global smartphone market (as long as you use a broad definition of smartphone). But it’s telling that Spotify made a point of making its service compatible with Apple’s (AAPL) iPhone and Google’s (GOOG) Android handsets first.

In any event, Spotify is only available via mobile to paying subscribers, who shell out around $16 a month in the U.K. (and less in some countries). They key question for the music business is how many subscribers there are.

Spotify won’t release statistics, but one number that I’ve heard from people close to the company is 100,000, which works out to less than two percent of the company’s overall user base (free users can listen to the service only on their PCs and have to endure a small smattering of ads). But U.S. music industry executives worry that the subscription number may be even lower than that.

The two sides continue to chat, and conventional wisdom is that the service will indeed get to the U.S. one day. But at one point, Spotify was talking about coming to America in 2009, but that looks just about impossible. Now, CEO Daniel Ek is talking about the first half of 2010.

]]> http://allthingsd.com/20091123/spotify-expands-its-mobile-reach-but-still-hasnt-landed-in-the-u-s/feed/ 0 http://allthingsd.com/20090827/pirate-bays-would-be-buyer-sinks-blames-media/ http://allthingsd.com/20090827/pirate-bays-would-be-buyer-sinks-blames-media/#comments Thu, 27 Aug 2009 11:32:23 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=10389 A proposed deal to buy The Pirate Bay and turn it legit, which never made sense in the first place, now looks all but dead.

Global Gaming Factory X, the Swedish software/Internet cafe company that’s supposed to buy the file-sharing haven for $8 million, was supposed to get shareholders to approve the deal today. But in advance of a shareholders meeting, the company issued a press release in which it says 1) that investors that were supposed to finance the deal have disappeared and 2) this is the fault of the U.S. media, which it says spooked said investors.

But wait! There’s more! Global Gaming Factor says it has figured out an alternate way to pay for the deal whereby the company’s majority shareholders in the penny-stock company will offer their equity as a security. Alas, there’s yet another catch: Swedish regulators, who have already suspended trading in the company twice in two months, are now threatening to delist it.

It’s hard to get too worked up about the failure of a plan that made no sense on the day it was announced. But for the record, you can read the backstory to this weird tale here and here. Meanwhile, The Pirate Bay itself is up and running and still cheerfully thumbing its nose at Hollywood, the big music labels, and the rest of the media world.

]]> http://allthingsd.com/20090827/pirate-bays-would-be-buyer-sinks-blames-media/feed/ 0 http://allthingsd.com/20090630/is-the-pirate-bay-going-legit-not-really/ http://allthingsd.com/20090630/is-the-pirate-bay-going-legit-not-really/#comments Tue, 30 Jun 2009 13:32:43 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=8789 You can hear the head-scratching going on at movie studios and music labels across the world: What just happened to The Pirate Bay? Reports out of Sweden are murky at best. But supposedly, a Scandinavian software outfit is buying the world’s most notorious file-sharing site for about $8 million and will create a service that pays copyright owners when people download their work. Maybe.

You can read a confusing release from the supposed acquirer, Global Gaming Factory X, here, and an equally confusing post from The Pirate Bay’s operators, here. And The Pirate Bay guys, who are supposedly looking at a big fine and a jail term, say they didn’t actually own The Pirate Bay but will get some of the profits from the sale anyway and will use them to finance an “Internet project.” Etc.

Oh! And the Pirate Bay’s new owners say they can’t promise that copyright holders are actually going to get paid. Here’s Global Gaming CEO Hans Pandeya in the Financial Times:

However, Mr Pandeya said the company would not be able to compel any filesharers to pay content owners. “We are trying to create a different model that addresses the needs of the different parties. However, it is up to them if they want to participate,” he said.

So it’s understandable that Hollywood and big music are mute, or close to it, on the deal. Because it’s difficult to say exactly what the deal is. I was able to extract one statement from the IFPI, the international music trade group. Here’s chairman and CEO John Kennedy:

“We don’t know the details and there are many questions to ask about how this will work in practice, but we would be delighted if this resulted in the Pirate Bay turning into a legitimate licensed service.”

But let’s be honest: There’s no way The Pirate Bay is going legit. And if it does, it won’t be The Pirate Bay, but something else.

Instead of being a massive site that attracts a huge audience that wants to devour free content, it will be a small distributor of licensed content, and the masses will flock somewhere else for their free stuff. Because they don’t want licensed content, even if it’s legal and/or better quality. They want free stuff.

The movie studios and the labels should be able to pat themselves on the back, gently and cautiously, for getting The Pirate Bay’s current owners to more or less abandon the site.

The problem, as they’re well aware, is that The Pirate Bay was only a directory that sent users to “torrents” that allowed them to gobble up as much pirated stuff as they want. And shutting down the Bay doesn’t mean the torrents are gone. And it doesn’t prevent other directory sites from popping up, whack-a-mole style, all over the world.

]]> http://allthingsd.com/20090630/is-the-pirate-bay-going-legit-not-really/feed/ 0 http://allthingsd.com/20090617/another-music-startup-sued-emi-takes-grooveshark-to-court/ http://allthingsd.com/20090617/another-music-startup-sued-emi-takes-grooveshark-to-court/#comments Thu, 18 Jun 2009 00:59:37 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=8299

Digital music start-ups seem to come in two flavors these days: Those being sued by the major music labels and those with expensive licensing deals they can’t afford.

But for some reason, plucky Grooveshark, which runs a very nice, free streaming music service, has stayed out of both of those buckets until now. I’ve confirmed that EMI Music Group is suing the site–whose motto is “Play any song in the world, for free!”–for copyright violation.

The label filed suit against Gainesville, Fla.-based Grooveshark in a New York court on May 8. I don’t have a copy of the complaint yet, but if you feel like sharing, hit me at peter@allthingsd.com or use the blind tip box here. No comment from EMI, but Grooveshark sent me a very long statement, which I’ve printed at the bottom of the post.

The takeaway: Grooveshark says it was working on a licensing deal with EMI and now finds itself in court instead. The company does refer to deals with “many artists, labels and publishers,” but as far as I can tell, it doesn’t have deals with any of the other three majors–Warner Music Group (WMG), Universal Music Group, or Sony (SNE)–either.

Grooveshark started out as a peer-to-peer file-sharing start-up in 2006, and has since morphed into a streaming model. When I talked to marketing VP Joshua Bonnain in May, he told me the company was primarily funded by friends and family–most of the company’s employees are either students at or graduates of the University of Florida, he said. But he also said the company had received a “substantial investment from a large party” that he wouldn’t identify.

Bonnain said the site, which generates at least some ad revenue, planned on splitting half of it with the copyright owners of the music it played. But I was never clear about how that was going to work since Grooveshark doesn’t have deals with the majors. Then again, Bonnain didn’t tell me that the company had been sued a few days before we talked, either.

In the music world, negotiations don’t preclude suits and vice versa; Warner was, at one point, suing iMeem, but then became an investor in the site. Same thing with Universal and News Corp.’s (NWS) MySpace. The only real question I’ve had is why the big guys haven’t gone after Grooveshark yet. I’ve been asking label folks about the start-up since November and I’ve only gotten shrugs for an answer.

Anyway, as I said, it’s very nice service, and it would be a shame if the labels can’t figure out a way to work with it or help it survive. But the odds of that happening, based on the unpleasant history of digital music start-ups to date, are very low. So enjoy this themed playlist I created with the site’s help, which features music from all four majors, while you can. Grooveshark’s statement is below.

For the past year, Grooveshark has been in talks with EMI Records and other copyright holders to negotiate licensing agreements for the use of their content. We are pleased to announce that over the past few months Grooveshark successfully concluded mutually bene?cial agreements with many artists, labels, and publishers that we hope to be a template for other such agreements with additional copyright holders.

Recently, EMI Records chose to abandon the template we’ve built with the help of other major copyright holders and opted for their traditional intimidation tactic of ?ling a lawsuit as a negotiating tool. We ?nd the use of this negotiating strategy counterproductive, as Grooveshark has been willing to conclude an agreement with EMI Records that is economically sustainable for both EMI Records and a start-up company the size of Grooveshark.

Grooveshark is run by a group of young and passionate musicians. We love music, we make music, and we believe that the use of all music should be paid for. We adopted this core philosophy at our inception and to date have concluded agreements with hundreds of record labels, major US performance rights organizations, and thousands of independent artists who support Grooveshark’s business model. (See: Grooveshark Artists)

As musicians, we support the rights of copyright holders and strive to sign sustainable agreements with all content owners, ensuring that all artists get paid– or we agree to remove content from our system in accordance with our DMCA Takedown Policy. We hope that EMI Records eventually follows the lead of the many forward-thinking labels we are already working with, who would rather get their artists exposure and a fair share of our revenue than block content access and force customers to illegal networks.

We understand that the economy of the digital music business is in a state of ?ux, and we hope to help ease this transition by providing the required new tools and services that lead to the next generation of the music industry. We respect the ownership rights of the major labels and publishers, and our core mission has always been to compete with piracy by offering a service that is genuinely better than what illegal networks offer, while also ensuring fair payment to copyright holders. Our next important step on our road to success is to conclude a mutually bene?cial agreement with EMI Records that is sustainable for both EMI and Grooveshark.

]]> http://allthingsd.com/20090617/another-music-startup-sued-emi-takes-grooveshark-to-court/feed/ 0