GenDigital

One Plus One Might Not Equal Two For MTV's Urge and Real Network's Rhapsody

According to a report yesterday, MTV has struck a deal with Real Networks to merge its digital music service, which has yet to gain any real traction, with Rhapsody, the digital media service operated by Real Networks with a hope of posing some sort of challenge to category killer iTunes. The service will get a big push starting with MTV's Video Music Awards on September 9th. In case you can't tell, we're skeptical on a positive outcome for the deal. Granted, MTV's service has been bundled with Microsoft's Windows Media Player for quite some time now, and the reality is that it has had very little impact on usage to date. The fact remains they are chasing down a competitor that has 90%+ market share so going after less than 10% seems more like a pipe dream than a sound strategy.

Is Advertising The New Radio?

Those folks that work in the music departments at major ad agencies are now referring to their musically-enhanced spots as the new radio. The saying goes, the jingle has replaced the single. Cute, right? Anyway, it definitely makes a lot of sense, radio consumption across the board is down because of the proliferation of portable digital music players, the growth of satellite radio, and simply the fact that lots of young people would rather throw a CD in their car stereos that tune in to 20 minutes of commercials every hour. So, it should make sense that record companies like EMI are announcing strategic partnerships with big time ad agencies like DDB in order to get preferred distribution and access to client spots. There is more than one way to peel an apple.

Ruckus Moves To Ad Supported Free Downloading Model

Hoping to make a bigger splash in the digital music downloading category, Ruckus Networks has announced a new service that allows students with a validated .edu email address to download music for free. Yes, there are some restrictions that go along with the service and there are some big shortcomings (in our opinion) as well. The Ruckus plan was pitched to the four major record label companies and some independent labels as well who have all agreed to participate in the new service as somewhat of an experiment. The experiment really is based on the fact that the service will be deploying an advertising supported model rather than a subscription based model. Will it pay off? Initial reaction would be no. The validated college student with the .edu address can download music for free to their computers. That's all nice and good. But the real value for the student is to transfer the music to their portable device, which in nearly nine cases out of ten mean transferring to their iPod. Here is the first hurdle for Ruckus. The transfer option is not free, it costs $4.99 a month, still a great deal, but the kid will still be laying out some dough after being pitch a "free" service. Second problem, and clearly the significantly higher hurdle, almost the size of the Empire State Building, quite frankly. The transfer service is not compatible with the iPod, thus shutting out about 90% of all prospective students. So, really the value for Ruckus is to reach students in their dorms or off campus residences when they are studying or hanging out. If that's the case, chances are the window that is playing the music from the Ruckus service will be minimized while the student is performing another task, consequently "blocking out" all display advertisements.

Gen Y's Version of New Kids on the Block

This is not your daddy's rock band. According to the New York Times, there is a very healthy, growing music scene in New York lead by musicians who can't even drive legally let alone vote or drink in the bars they are playing in every weekend. After reading the article twice, I came away with some thoughts and takeaways that are extraordinarily parallel with the current state of youth sports and other extra-curricular activities that Gen Y tends to participate in, including theater and dance. This is a fact: there are several groups of very, very talented musicians under the age of 18 making their way around the New York music scene, many of which are sons and daughters of celebrities, so no doubt, there were probably a few strings pulled at the beginning, but clearly some of these kid bands have talent and their own organic following. This is a fact: More times than not, parents of Gen Yers want their kids to not just be "good" at something, they must be "excellent" or "very special." Whether it is junior football (where there is always the threat of a parent "confronting" the coach on the lack of playing time their kids gets) or theater (the parent gets upset when their kid gets a small part in the play), there are some definite similarities all revolving around something we call "unique success" (if you are a Youth Trends client, you'll know what that terms means later this month when we release our next Insights report). The difference however, and it is an important one to take note of, deals with a sense of open creativity, a culture of creativity, if you will. Many of the parents of these grungie teenie bopper rock stars were once (and many still are) grungie, artsie, creative folks themselves, and they seem to have encouraged/pushed their kids in the same direction which, will probably end up being an advantage if you were to make a direct comparison between the kids involved in the NY music scene compared to those kids involved with a particular individual or team sport or the theater. This is all fascinating stuff, someone could write a book about the parents of Gen Yers and their must-excel-at-something-even-it-if-kills-them children.

High School Musical Hits The Road

The enormously successful Disney High School Musical franchise is about to get even bigger. No doubt that Disney/Buena Vista music execs looked at the success of the American Idol national tour as precedent before making their latest moves. Notice I say moves...So here's the deal on the first one, the mega hit movie (a sequel is in the works, of course) and corresponding multi-platinum soundtrack is taking it to the road for a 40-city live tour beginning right after Thanksgiving in San Diego. The Cheetah Girls, another successful tween targeted Disney TV musical is already in the midst of a sold-out 60-city tour, which, according to my eight-year old niece, "was so very cool." Perhaps we are getting a glimpse of the Disney multimedia franchise strategy of the future: from on-screen, to in-store and in-person.

AOL's Loss is MSN's Gain

Network Live, the partner company to AOL responsible for last summer's wildly successful live stream of the Live 8 concert series on AOL has ended its relationship with AOL and moved on to a new distribution deal with Microsoft. Network Live has renamed their operation Control Room and its first featured online stream will be a John Legend performance on October 2nd from the Royal Albert Hall in London. The company plans to make 36 live concerts available on MSN's online platform over the next couple of years.

Can SpiralFrog Take Share From iTunes?

According to research firm NPD, iTunes has a 67% share of the paid or legal digital music downloading category and according to our latest research, iTunes share of the category among teens and college students is closer to 77%. Regardless, as I've said many times before whether it was Urge or any other newcomer, breaking in to this category would be tough. A relatively new outfit, called SpiralFrog, has decided to skip the paid part of the downloading game all together and instead use an advertising-supported model. Pretty aggressive and pretty risky. Of course, you need a music company (ideally one of the big ones) to believe enough in the model to sign on as a distribution partner. Yesterday, the company announced its first big distribution deal with the world's largest music company, Universal. As you can probably guess, the terms of the deal weren't released, but I can't imagine any gigantic guaranteed payment to Universal, I think the music giant is looking at this as more of a test at this stage, regardless of the press hype around the announcement, which was enough to send Apple's shares down 2% yesterday, a bit of an over-reaction, in my opinion.

Paris Lands on YouTube To Promote Her New Album

Those of you who doubted the staying power of Paris Hilton (myself included) in the past only to be chagrined as she persevered, here's another chance to say no way. This time however, I am going to lean on the side of her succeeding as she makes a transition from heiress/reality tv star/club promoter to musical artist. In a coup for the video site YouTube.com, Paris' new CD, which is available as of today will be one of the first products marketed on the site's front page. As reference points, according to our most recent Top Ten Report, YouTube is the 8th most popular site among teens and college students and Paris (for one reason or another) is the 6th most popular female celebrity. Based on her new album, I expect her popularity (prepare to gasp) to actually increase significantly over the next three months. Take a listen for yourself...her stuff is (I can't believe I am going to say this) pretty good and should certainly resonate among her target market of tweens, teens and young adults.

Concert Attendance Should Be Up This Summer

I just got back the results from our monthly trend report (email me if you would like a complimentary issue) and thought I would share one of the more interesting results. One of the most popular summertime activities for teens and college students is attending a musical concert. We began tracking summer concert attendance two years ago and have noticed an increase in attendance and planned attendance since 2004. This summer, 53% of teens and college students plan to attend (or have already attended) at least one musical concert, up from 47% last year and 44% two years ago. In addition to asking our proprietary panelists whether or not they plan to attend a concert, we follow up and ask which acts they plan to see. As you can imagine, the musical tastes of Gen Y vary widely by age, gender and mostly, geographic location. The increased popularity of this season's installment of American Idol should have a positive effect on the Idol Live Summer Tour, with more than 10% of panelists planning to attend one of the stops, making it the second most popular touring act behind only the Dave Matthews Band, and ahead of other big names like the Red Hot Chili Peppers, reggaeton star Shakira and former American Idol champ Kelly Clarkson. Oh, by the way, the Idol Live Tour kicked off last night in Manchester, NH, but without runner-up Katharine McPhee, who was sidelined with a case of laryngitis. As I've posted several times before, the whole concept of live event marketing and promotions works well with the Gen Y audience. Integrating a product or specific promotion alongside a concert tour has positive effects: your aligning your product next to something that is already deemed cool and relevant by your target audience, you're reaching out to them at a time when their wallets are open and they are in a good mood, and the opportunity to get right up to them with a product sample or something to that effect will never be greater. With attendance and planned attendance up, the hardest part for marketers and media companies is choosing the right musical act to partner with.

Sony BMG Music Entertainment Serves Up User Generated Content

Sony BMG Music Entertainment has unveiled Musicbox, a new flash-based site that offers videos, interviews, rarely seen footage and best of all, attempts to reach out to music bloggers and fan sites to link to the content. Because the footage is flash-based, the content is not as easy to pirate, which gives a certain comfort level for the music giant to take on a such a venture. Visitors are encouraged to link to certain portions of the site and the code and instructions for setting up the links is easily found on the site. This should be a great opportunity for Sony to promote their roster of artists both new and old on a platform that is sure to gel with the current technological tastes of Gen Y.