Monday, June 13, 2011

Deezer's future threatened by a complaint from Universal

Deezer and between record labels, is "I love you I do not either." On the one hand, the independent label Sooner or Later will use the resources of Europe's leading streaming music and offered him to celebrate his fifteenth birthday, a nice roster of artists on stage (Yael Naim Thomas Fersen L, Dick Annegarn, Heads Stiff ...).

They will succeed at the Cabaret Sauvage in Paris, Tuesday, June 14, for a private concert broadcast live on Deezer. But the charm of operation will not forget that Universal Music Deezer filed a complaint June 10 in summary proceedings before the Tribunal de Grande Instance de Paris for infringement.

The first major French accuses of illegally using his platform music catalog, the contracts have been renewed in January has still not been finalized. "We agree on prices, but not on the operating conditions of our catalog," said Pascal Negro, CEO of Universal Music. His target: free on the Internet.

"All the comments we have conducted by Tech News Buzz lead to the same conclusion: the provision of a free catalog with funding by advertising does not support the music industry," he insists. In 2010, according to Universal, Deezer, which owns 90% of streaming (no download play) in France, would have returned to producing music a "small" four million euros from advertising revenue.

The announcement on June 6 by Deezer its new business strategy - to offer five free hours of listening to an unlimited selection of songs - of course cringe at Universal Music. Universal Music and Deezer both agree to say that the market must move to a paid model. But their vision of how to get there differs.

Universal Music has signed a licensing agreement with the Swedish platform Spotify streaming European number one, who dreams of foothold in the United States. As a commercial, it was authorized April 10 free hours per month while limiting to five times the number of listening to a single title.

This practice (known as "try and buy", try and buy) encourages users to subscribe to the paid versions allowing unlimited listening, a model obviously more profitable for the industry. If Axel Dauchet, CEO of Deezer, users want to convert to the principle of subscription, it rejects the strategy of Spotify.

"After the fifth listen, the title will disappear forever. If we follow this strategy, we will lose the basis of our users - around 20% - which, themselves, will never go to the offer subscribed. We found a solution acceptable to all fifty producers who work with us, except for Universal.

He might be bigger, it must be consistent with our plans. "Pascal Negro, bear the formula Spotify reply:" Deezer is the only platform in the world that have not subscribed to our conditions. And do not worry, our catalogs will be on pay deals, not the free. That's all. "Despite this strong speech, pragmatism prevails.

Deezer boss may consider withdrawing from that which represents 40% of the music market in France. Such a scenario could threaten its partnership with operator Orange. Including paid access to the platform in some of his musical phone plans, the telecommunications operator, which holds 11% stake Deezer (Xavier Niel, also a shareholder of the World, is a major shareholder) has significantly increased the number of subscribers (around 1 million, with a quarter of regular users).

"Our agreement with Orange is a historic success," said Axel Dauchet. This dynamic one is crucial to educate the market and pass on the free charges. At Orange, it seems to have given a huge boost to the music industry. They are very worried today. "Pascal Negro replies with a smile:" Spotify has 800,000 paying subscribers on a Swedish population of 9 million, or 1 in 9.

Waiting on 9 million French subscribers to Deezer. "Article published in the edition of 14.06.11

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