Uplister Cuts Indie Label Deals for Subscription Download Service
by Mark Lewis
Playlist-sharing service Uplister said today it has struck music licensing deals with several prominent independent labels, paving the way for a subscription download service that it believes meets the needs of its audience better than major-label services.
Oakland, Calif.-based Uplister will license albums and tracks from the Beggars Group, Matador Records and TVT Records, home collectively to artists including Badly Drawn Boy, Cat Power, Guided By Voices, Kristin Hersh, Nashville ***** and Yo La Tengo.
The deals will fuel an unlimited download service that will be available as a test version by the end of summer, Uplister executives said. The firm hopes to launch by year's end a $10 per month commercial version, based on a new web interface instead of Uplister's current downloaded application.
Users will be able to download tracks and full albums in Microsoft's Windows Media format, and Microsoft's security technology will ensure that tracks will only play for paid-up subscribers. Uplister users currently build playlists of 30-second clips; the new services will keep that structure, but subscribers will be able to download tracks from a list in one click.
Unlike forthcoming major-label services MusicNet and Pressplay, which won't allow CD recording or portable device playback, Uplister will offer a second-tier service in which tracks can be purchased outright for around 99 cents each, said Uplister CEO Toni Schneider. Those tracks can be copied, recorded to CD and exported to devices that support Windows Media.
Schneider said his firm is responding to the demands of its 150,000 unique monthly users, 80% of whom record their own CDs.
Another fundamental difference from major-label services is that Uplister has studied its existing audience and licensed music that interests consumers, rather than build a massive music database and hope the smorgasbord will attract users.
"In the current Uplister system, independent-label content has 30 percent market share in the top 1,000 playlists," said Schneider. "We targeted those independents to do licensing deals." Uplister plans to target independents including Alternative Tentacles, Knitting Factory, Shimmy Disc, K Records, Lookout!, Moonshine Music, Roadrunner Records and Soleilmoon Recordings for future deals.
Still, Schneider's figures means that 70% of Uplister's top playlists comprise major-label content, which Uplister won't have initially. He said his firm will eventually approach certain major labels about selective, rather than blanket, licensing deals.
"The [independent] labels they're working with are very impressive and certainly have given them an endorsement," said Aaron Newton, president of Epitonic.com, a Sputnik7 subsidiary that offers free downloads from more than 400 independents. "But the question remains whether the audience is there to pay for the Uplister service and whether Uplister has the financial funds to draw the audience and stay afloat."
Besides competing with free file-sharing applications and download services from EMusic, MP3.com and the forthcoming MusicNet (backed by EMI Recorded Music, Bertelsmann and AOL Time Warner), Uplister may compete in certain respects with Launch Media's interactive streaming service. It could also compete with planned on-demand streaming services such as Streamwaves, FullAudio and Pressplay, the latter of which is owned by Sony Music Entertainment and Universal Music Group.
The pursuit of independent labels for paid distribution follows a trail cleared two years ago by MP3 retailer-turned-subscription service EMusic. Napster took a similar course for its projected subscription song-swap service, first announcing a deal with TVT, then announcing in June a large-scale licensing deal with 150 European independent labels [see 06.26.01 Deal with Euro Indies Boosts Planned Commercial Napster Service].
TVT President Steve Gottlieb said his label will distribute through both Napster and Uplister because in a world of multinational corporations, "we strongly support independent companies and their right to have an opportunity to compete in this space." Because Uplister is a "totally new and unique functionality that doesn't exist in the real world, it's not cannibalization or replacement" of other music formats, he added.
Uplister's independents signed worldwide, non-exclusive deals, which could give them more flexibility than the exclusive deals dozens of labels signed with EMusic, which is now owned by French media conglomerate Vivendi Universal. "EMusic did a couple of high-profile deals, but most were small compared to our partners," Schneider said.
Tom Chernaik, CEO of independent label and artist promotions firm AllIndie.com, praised Uplister's structure of utilizing users' playlists to generate trusted recommendations, adding that Uplister's non-exclusive deals and targeted model is sensible for independent labels. "By focusing on things that you can see are already finding an audience, you're making a much safer bet," Chernaik said.
Jeremy Silver, a former EMI new media executive who is now Uplister's executive vice president, said his firm projects "tens of thousands of subscribers in the first year." Uplister can afford to build conservatively because it doesn't employ a large editorial staff to categorize and write about music, Schneider said.
Silver said Uplister will seek wider distribution by licensing an XML-based application interface that taps Uplister's music database and service, allowing other services to build their own interfaces. The re-sellers will be able to set their own prices for the service, paying Uplister a wholesale cost.
Additionally, Nullsoft plans today to release an Uplister plug-in for its popular Winamp software music player that will allow users to find Uplister playlists corresponding to their music collections. Uplister executives believe that will drive subscription sign-ups once the service is launched. Developed by AOL Time Warner's Nullsoft, Winamp claims 90 million registered users.
Uplister was founded in September 2000 with $6 million from Menlo Park, Calif.-based August Capital [see 09.26.00 Playlist-Swapping Site Uplister Funded with $6M
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