Music biz speeding toward iCar
Popkomm panel discusses convergence of tech, torqueVehicles will drive a viable revenue stream for record labels in the coming years, panelists said Wednesday at the opening session of Popkomm, the three-day international music and entertainment conference being held here.
"Cars have been an offline silo for a long time. Now they are starting to come online," said Ty Roberts, co-founder of chief technical officer of Gracenote, who moderated the "Auto Mobile Music: The Dashboard Jukebox" panel.
While in-car music interfaces are limited by technology and safety issues, the participants noted, new voice-activated devices are poised to enter the market, breaking open the possibilities for tuning in at the wheel.
"We will connect our cars with the Internet in the next three to four years. It's small steps we are taking," said Wilbert Hirsch, principal of Audio Consulting Group in Germany. "The iCar is not far away."
Stephen White, Gracenote's senior director of product and content management, urged music companies to align with car manufacturers.
"The big opportunity is to work with the automobile industry now," he said. "It is a new frontier for digital music. We have to see what the reaction is to the user community. You need to think of automotive as a distribution channel."
The sophisticated devices of the future, built into existing satellite-navigation systems, will enable drivers to customize their playlists on the go.
"Personalized downloads to the car will become a viable business model," Hirsch added.
And music videos inevitably will come into the mix. "Music videos in the car are not good for the driver," quipped Chrisa Haussler, senior vp at Sony BMG Music Entertainment Germany. "But how do you entertain the kids in the back? It's a good option."
Other speakers suggested downloads could be bundled into the price of car repayments, and delivered when the vehicle is being serviced.
"When we talk about filling the car up, we could be talking about filling it up with music," Roberts said.
Later in the Popkomm program, the complex system of rights collecting in Europe and the slowing market for ringtones came under the microscope.
Philippe Kern, CEO of KEA European Affairs and founder of European independent music companies trade body Impala, took moderation duties for the afternoon panel called "Collecting Societies Joining Together: Entent Cordiale or David vs. Goliath."
The session pitted executives from European collecting societies Buma/Stemra, SACEM, GEMA and labels body IFPI. And though it never quite descended into the battle it promised, attendees were treated to an insight into the competitive nature of European rights organizations.
"Harmonia is ready to cooperate with everyone. We need cooperation from all the societies," said Thierry Desurmont, deputy CEO of France's SACEM. Along with Italy's SIAE and Spain's SGAE, SACEM is a crucial cog in the Harmonia one-stop licensing alliance. "But it means the small collecting society will also need to improve their measures of administration to achieve better efficiency."
Joe Mohen, founder and CEO of ad-supported digital music firm Spiralfrog, chipped in from the audience: "I've come into the industry from a computer programming background. Music is the most complicated intellectual property ever. It makes software seem like a vacation."
Later in the day, executives admitted on the "Stepping Into the Popkomm Ring" panel that the market for ringtones — until recently a revenue power-player for the industry — has seen its heyday.
"It's not a growing business. I hope that it will stay stable, but that is optimistic," said Gudrun Schweppe, vp music licensing at German ringtone and download firm Jamba. "Handsets are improving, and the typical ringtone buyer can edit his music on his computer and turn into a ringtone. We're looking at new business models, such as selling full-track to mobiles. We need to find new ways of having people pay for music. But it's still very difficult to operate on an EU-wide basis."
Lars Brandle is global news editor at Billboard.