The effort, codenamed "Vevo" according to the Wall Street Journal, would involve a new showcase for music videos on YouTube, with the notion of commanding higher advertising rates. Right now, YouTube makes pennies per view — if it's lucky. Most of YouTube's bandwidth-consuming video funhouse goes unburdened with revenue.

In December, Warner abruptly withdrew its music videos from Google. Most people assumed Warner was throwing another typical record-label fit and being unreasonable. The word from the Googleplex, though, is that the Warner deal was a victim of CFO Patrick Pichette's cost-cutting crusade. In YouTube's early days, the video site had struck a deal, then hailed as groundbreaking, to pay Warner to play copies of its music videos uploaded by users and thereby avoid a massive copyright-infringement suit. But that deal was rather richer for Warner than for YouTube. Google executive Jonathan Rosenberg explained the move on a recent conference call with analysts:

... we'd love to work with Warner. But I think we're going to continue to do what we've been doing; try to continue to make mutually beneficial deals and then try to do some of the things like we talked about on the earlier call with respect to better monetizing YouTube ...

In other words, Google just doesn't make enough off of videos to justify the rates it's been paying Warner and the other labels.

Did Warner walk, or did Google dump it? It's still not clear. What is clear: There's not enough money in online music videos to go around. Google and Universal are negotiating a deal in the hopes that there will be.

But what if there's not? In the '80s, teenagers stared slackjawed at MTV, because there simply wasn't anything else like it on the air. But now, thanks largely to YouTube, there's a surfeit of video everywhere you go. And traditional three-minute music videos, while they satisfied an '80s attention span, are too long for the YouTube generation, which likes its clips a minute or less. (A classic video like Take On Me seems epic now.) Perhaps the record labels should count themselves lucky if they get a link to iTunes, let alone a revenue share — and that anyone still wants their music videos at all.

Micorosft's music player has always been an also-ran, a late-to-market entry which mimicked the iPod but offered no new features consumers found compelling. Interviewed at the Consumer Electronics Show in Las Vegas, Ballmer backed into an admission of failure:

In digital music, meanwhile, Mr Ballmer seemed all but ready to throw in the towel on the Zune mobile device, which has failed to gain ground on Apple’s iPod. But he suggested that the focus of competition in digital media was moving onto ground that Microsoft understands well: software.

He said that, with the market for dedicated portable media players in decline, the future lay in more “general purpose” devices – such as Apple’s iPhone and touch.

Asked if Microsoft would counter with a “Zune Phone”, Mr Ballmer said: “You should not anticipate that.”

Great advice, Steve! As if anyone — aside from the media, which loves a good fight — was ever anticipating more Zune products. Even Steven Smith, the fellow who infamously tattooed himself with three Zune logos, has switched to an iPod.

So what has Microsoft "learned" in its "long journey"? Well, it's back to making software, largely for cell phones, which other manufacturers will then deliver to consumer — the model it knows so well from PCs. But that's also the same finger-pointing business model which led it to abject failure in the music-player market before it started a crash program to create the Zune. And a recent glitch which rendered a popular Zune model dead on New Year's hardly furthers the notion of Microsoft being strong in software.

How funny that Microsoft executives think its technical strategy is what needs to change, when the real problem is that the Microsoft brand is far too stodgy to succeed in an image-driven business like music. That's the kind of cluelessness that leads to one failed campaign after another — like a wannabe politician who just can't grasp the idea that no one wants to vote for him.

From: Andrea Boone
Date: November 14, 2008 9:07:06 AM PST
To: Subject: Music-mobile partnership serves up industry artists

Hi Paul...MySpace has given millions of users the inside scoop on hot new artists and the next big single. But interest has plummeted, and with the cell overtaking the computer as a user’s ‘first screen’, the mobile industry is the next promotional frontier.

SRC Records found the solution in a unique music-mobile partnership with mobile-only social networking site, [REDACTED]. [REDACTED], the largest mobile social network in the US and third most trafficked site on the web, turns a user’s cell phone into the only source for exclusive unreleased demo tracks and interviews by Def Jam artists. Holed up in a tiny NYC hotel room with a video camera, [REDACTED] asks the artists questions keyed in by members from their cell and streams the interview to chat rooms and the site. Love it? Hate it? Users key in feedback- the power to ultimately determine if or how the song is released.

Today—American Idol David Cook has ‘leaked’ one of his tracks for his album slated for release on the 18th—

Do you have time to do a quick call?

Thanks,
Andrea

——————————————————————-
Andrea Boone| Account Executive| SSPR

(photo by AP/Jason DeCrow)

A group of record labels sued Project Playlist in April — which is, sad to say, the music industry's usual approach to beginning talks. Van Natta has a reputation as a skilled dealmaker, and he led talks with the labels while at Facebook. But sources who have had recent negotiations with labels say they have been granting only short-term licenses for music — typically a year in length. Their strategy is to give startups a year to grow — and then shake them down for most of the profits they generate. Does Van Natta think he can get a better deal? Since he's taking the job, he must be betting on it.

I think I've outed Bill Nguyen's secret: In a Valley full of people who want to be Steve Jobs, he wants to be David Geffen — the maverick behind the scenes in the music business. Stoking the starmaker machinery behind the popular song! Too bad the truth is more like that other Joni Mitchell line: "I deal in dreamers, and telephone screamers."

UPDATE: Bill replied after I hit Publish too soon. I'll just paste it in:

Hi Paul,

You're not going to believe this but I just saw Leslie. I'll try to find a photo to send over in 20 minutes if you didn't get one. I definitely go to work to return capital but much of the decision for lala is the amazing economic challenge. It's great fun to wake up everyday with a team that includes Geoff Ralston (former Chiief Product Officer of Yahoo, Anselm-Baird Smith, creator of first java server and contributor on HTTP 1.1, and Billy Alvarado who ran all of engineering at SEVEN.)

We get to take on a challenge in an industry that's over hyped but lacking in revenue. So instead of following everyone into the advertising model, we went our own way to build the best app we could void of any advertising and driven by commerce. The result is an amazing new product, $20M in the bank, and opportunities we could not have imagined as competitors fold under the weight of the market.

It's the best time ever to building. And yes, it definitely helps that we play with music :-)

Bill Nguyen
co-founder, lala.com

• SlotMusic cards will be SanDisk MicroSD cards preloaded with music, album art and other extras.
• Each card will be packaged with a USB sleeve, making plug-in to any computer theoretically no problem.
• The details in the announcement seem intentionally vague on whether the disk will be a one-on-one alternative to CD albums, or whether record labels will create bundles that take advantage of the cards' 1 GB capacity.
• MP3 will be the audio format, with rates as high as 320 kbps rather than the grainier 128 kbps most commonly used to share MP3s. (The 128 kbps rate was chosen as the target for MP3 audio quality back in the early '90s, when ISDN lines were the future.)
• No DRM! Seriously, none.
• The Big Four music labels — EMI, Sony, Universal and Warner — have signed up.
• So far, no details on the initial catalogue of music. "Check back soon for announcements" says the artists page at SlotMusic.org.
• It's gotta be annoying to the record execs involved that Slotmusic.com is owned by a defunct band called S.L.O.T.

Wrong. Roxio, a CD-burning software company, snapped up the Napster name and the technical assets of Shawn Fanning's file-sharing startup on the cheap. But sometimes you get what you pay for. Roxio shed its software business and took the Napster name, but never figured out how to profit from it. In the last year, it lost $16.5 million.

And yet Napster managed to live on. If anyone can lay it in the ground once and for all, we're betting it's Best Buy. The retailer has stumbled from one unsuccessful online-music strategy to another, most recently through a partnership with RealNetworks' also-ran music site, Rhapsody. Why doesn't Best Buy just ask Steve Jobs for more iPods to sell? That seems easier.

Imeem CEO Dalton Caldwell, whose company already offers a similar product,