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June 15, 2005

Independent Music Clout Growing

IodaCNET: Here's a link to an excellent interview with Kevin Arnold, CEO of the Independent Online Distribution Alliance (IODA), which is the industry-leading digital distribution company for the global independent music community that distributes thousands of releases from independent labels to digital music outlets around the world. Surprisingly though, independent labels still don't receive the same royalty percentages for online sales as major labels do - even when working with an aggregator like IODA. Hopefully that will change with time as the sector's marketshare increases. (Some estimates put independent music comprising almost a quarter of the U.S. music market - nearly $3 billion.)

Overall, Arnold seemed to support the subscription model, where returns tend to come as a percentage of subscription revenues, instead of a set amount per download and the "barrier to experimentation is pretty much nonexistent." He points out that songs licensed for subscription services can essentially earn indefinitely and the model is a little more of an open ended platform and also predicts that eventually, monthly music subscription prices will rise once enough people sign up - just like cable tv has..."Basically, any indie label that's not participating in digital music is leaving money on the table and the main thing to realize is that, "It's still very young, and the rules of the game haven't changed such that this is some magic elixir. It's still a rough game." I was a little surprised to hear him claim that the current digital market is 5 percent of the overall market, but he may have access to proprietary research.  As the rules change and mountains are moved - it's too soon in the game to tell whether the indies will ever get the equal respect that they deserve at the bargaining table, but I for one am glad there are organizations like the American Association of Independent Music (A2IM) and IODA out there fighting for our rights....

Posted by Todd in Indie Labels | Permalink


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We have a new site up (Still in beta testing. my id# 2265)
We plann on being the biggest and best site for all the indies of the world.

check it out. www.apeus.com

Thanks, Steve L.

Posted by: steve | Sep 27, 2006 4:39:41 PM

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