Two summers ago, Turntable.fm, a place to virtually listen to music with your friends, was everyone's favorite website. Many hours of American Office Productivity were sucked away. Then, we all moved on to new distractions—but Turntable sealed a $7 million investment round, and gradually torched it.
Unlike so many other web companies that raised millions of dollars in VC cash, Turntable was very well liked! It proved to be a musical ephemerality, a browser fad, but at least it can say that at one point in time, it was providing a thing that made people who used it happy. In that way, it outclassed almost most startups that have ever or will ever exist. But running an online house party isn't a good way to run an IRL business, and according to Digital Music News, it's finally caught up with the team: "This is a company that is now admittedly fighting for its life." The company spells out its troubles in a new blog post:
Early on, we decided to partner with the labels and do everything by the book. There were pros and cons to this. One of the biggest cons is it has been very expensive. We spend tens of thousands of dollars a month in royalties, service fees, hosting, etc. We could have removed a ton of that cost by just simply using YouTube or another service, but we felt it would dramatically reduce the ease of use and user experience.
So that leaves us in a tough place. We started turning on ways for the community to help support us (GOLD) and methods to offset some streaming costs for non-gold members (ads). Thank you to everyone who has joined in. It means a ton to us.
All of this is in the hope to try and neutralize the cost of running Turntable so that we can keep it running. The change we made yesterday, removing the ability to upload music directly, will reduce our monthly bill by roughly $20,000. That’s a huge saving that we need and we thought validated adding an extra step to uploading (upload it on SoundCloud and search for it on Turntable). It was a choice we had to make to keep the service running.
When you start jettisoning feature cargo to keep the whole thing afloat, the capsize isn't far off. Turntable's co-founder Billy Chasen says "Turntable is incredibly important to us and we want to see it stick around. We aren’t trying to kill it, you are watching us fight for it." But this kind of admission of mortality is rare even for companies that are clearly screwed—to volunteer this kind of dire stuff means it's even worse than it seems. And worst of all if you stuck $7 million into the whole outfit.
[via Matt Lynley]