Warner Music Group chief executive Edgar Bronfman Jr. has recently commented that the “free streaming services are not a positive thing for the industry,” and assured that “as Warner Music Group goes, [our music] will not be licensed. It is not the kind of approach that we will be supporting in the future.”
British news sources, namely The Guardian and BBC, report that services such as Spotify, Last.fm, and We7 will no longer have the right to stream artists and songs from Warner Music Group. However, according to a Warner spokesperson, deals already in place will remain, meaning if a streaming service plays an R.E.M. (Warner) song that was licensed in a previous deal, listeners may still stream it. But if R.E.M. release a new album soon, don’t count on being able to listen to those new songs on free streaming services.
The Guardian and BBC cite services popular in the U.K. and Europe, and at face value, this issue seems to only concern European music fans. However, North American music lovers must take note, because services especially popular in North America such as Pandora are also likely to be affected by the change. Of course, the U.S. is no stranger to Last.fm, either. Spotify, a primarily European service which allows free streaming with advertisements or fee-based mobile streaming without ads, has plans to enter the U.S. market in the near future, and subscribers will have to deal with a lack of new songs from Warner.
Spotify was on track to prove its legitimacy as a business model, but they are likely to suffer from Warner’s decision, according to Paul Brindley of Music Ally digital music consulting, saying that Warner removing their catalog would “definitely be a tremendous blow” to the service they provide.
Bronfman and his corporation make their comments and decisions in light of Warner Music Group’s most recent sales figures, which indicate a loss of $17 million (£11 million) in the last quarter of 2009.
WMG was mostly influenced by their own losses, which they believe is partly caused by the aforementioned streaming services. The megacompany also has plans to start a subscription-based music service to mitigate losses. They are in hopes that their service will take away attention from Apple’s success with iTunes.
