It’s official: MySpace has closed on its acquisition of Imeem, the streaming music service. It is paying a fire-sale price of $1 million, sources familiar with the situation tell me, and could pay up to $7 million to $9 million in earn-outs for key employees, who will likely include CEO Dalton Caldwell. Investors like Sequoia and Warner Music Group had pumped at least $25 million into the venture.
Going, going, gone: The last of the Web 2.0 music services are dwindling away. The latest is Imeem, which is in the process of being purchased by MySpace, I’ve confirmed.
Haven’t heard a price yet, but I wouldn’t expect much, given that this deal, like the iLike purchase MySpace made earlier this year, is an “acqhire”–News Corp.’s social network/portal wants to buy Imeem for its “sales team, engineering, Snocap and other Imeem IP,” a person familiar with the transaction tells me.
Google insists, over and over, that it has no intention of getting into the content business. So how is it finessing its way into the music business? Very carefully.
The search giant is working on a new service that will provide searchers with streaming music, which sounds a whole lot like a content play at first blush. But Google will only be offering limited bits of music, and it will be relying on other companies–Lala.com, MySpace’s iLike and Imeem, sources say–to actually provide the tunes.
Well look at that: EMI Music Group, which had been working on a licensing deal with music start-up Grooveshark but ended up suing it instead, now has a licensing deal with Grooveshark after all.
A year ago, Apple’s iTunes owned about 70 percent of the digital music market, and newcomer Amazon had just five percent. Today, Apple still has 70 percent, but Amazon has…eight percent. In other news: People are buying music from Microsoft’s Zune store!
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.
Just a few weeks after a very public breakup, Warner Music Group and Imeem are getting back together again. Warner, which told investors last month that it had written off the $16 million it had invested in the Web music start-up, plus another $4 million in debt, has made a new deal with the company and will get another slug of equity. The big difference–this time, Warner isn’t cutting Imeem a check.
Last year, Warner Music Group boasted about its investments in two digital music start-ups. Today the label says those dollars were wasted. Bummer for imeem, which is trying to raise more money.
The once-buzzy start-up isn’t on life support yet. But it sure could use some help–just like every other Web music player. I can confirm that the company has sought, and received, new terms from some of the big music labels, most notably Universal Music Group. One big label that hasn’t given imeem any concessions yet: Warner Music Group, which owns an equity stake in the company.
Common sense tells you that the CD is a vanishing artifact. Slightly more surprising: Music consumers–or at least, people who are willing to pay for music–are disappearing, too. So says the NPD Group, which estimates that 13 million Americans stopped buying music last year.
Why does EMI want to build its own music site? As a “learning lab” the company says. Lesson one: Finish building out the lab.
iLike, the Web start-up that made a name for itself by becoming Facebook’s de facto music service, is looking for a buyer, according to multiple sources. I’m told that iLike is actively soliciting a list of buyers that include RealNetworks and Ticketmaster, which already owns 25 percent of the company.
Give the music industry credit–a decade after the original Napster, it’s now standard practice to let fans listen to an entire disc worth of new music, for free, before it ever gets to stores. The latest example: Britney Spears’s new album, “Circus,” which you can listen to at iMeem.com. Or at the bottom of this post, via a groovy embeddable player.
Peter Kafka has been covering media and technology since 1997, when he joined the staff of Forbes magazine. Most recently, he has been the managing editor of the tech and media Web site, Silicon Alley Insider. Read more »
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