Deeper into the mix
It's interesting to see Loudeye, key enabler of legal download services (and aspiring disabler of P2P networks through its Overpeer division), announce a second deal in the Portugese market in a month, with local label X-Tazee Records (last month it was Portugal Telecom). With every conceivable player rushing headlong to sell the same Kylie and Justin Timberlake tracks, this is bound to be the next wave in differentiation for digital content, digging into local content on independent labels. Portugal in particular is an interesting case in point, because while a small country, there are large Portugese communities in the UK and Luxembourg (it's true), where other Loudeye/OD2 platforms are already in place.
On a more global view, independent labels account for around a quarter of global music sales, as much as a third in Africa and Asia ex-Japan, and around half in Japan. Getting U2 to back a signature edition iPod is a great marketing ploy in the US, but it might not mean a great deal to a teenager in Shenzhen (and in the film world Hollywood can occasionally get its nose bloodied by content for which local audiences find they have more affinity). Though the major labels are now more risk-averse in developing new acts, local knowledge and an eye/ear for the unusual should in fact be the key to a differentiated digital music offering.
Enter TuneTribe, which was today profiled in the Financial Times. Headed by Groove Armada's Tom Findlay, it is to launch this month, and offers artists and labels an 80% cut on downloads, as well as allowing each to manage pricing as they see fit. The FT reports that 30 independent labels have signed up in the past week. TuneTribe will also take an active role in artist development and promotion, launching an internet radio station next year with a playlist comprised of popular content from its site, and also funding studio time for promising unsigned acts. It's going to be interesting to see if something this apparently democratic and decentralized can deliver a black eye to the major labels, iTunes or Loudeye.