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Q&A: Deezer says streaming doesn’t kill CDs and music downloads

October 14th, 2013 | by Alfred Siew
Q&A: Deezer says streaming doesn’t kill CDs and music downloads
Internet
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Dona yellow

Deezer arrived in Singapore and Southeast Asia last year, ahead of other music streaming services such as Spotify, to finally gave music lovers in the region an alternative way to get their groove on.

Just what do fans in Southeast Asia listen to? And will such streaming services, criticised by Radiohead frontman Thom Yorke as being unfavourable to musicians, replace CDs and music downloads in future?

Techgoondu checked in with Dona Inthaxoum, Deezer’s head of label relations for Asia and Oceania (above) for a quick e-mail interview.

1. Can you share with us the reception in Southeast Asia so far for Deezer since the launch a few months ago? 

We are unable to provide a breakdown of subscribers in Asia, but we have seen positive interest and uptake in Deezer since we launched in Singapore, Malaysia, Thailand, Indonesia and Philippines last year. Globally, we have 10 million monthly active users, four million of whom are paying subscribers.

2. What are some of the popular tracks that users are listening to and how do music fans in the region differ in terms of taste and other usage patterns from other regions like the United States?

Within Southeast Asia, we find that Singaporean users on Deezer take more interest in American pop music, whereas other countries listen to more local music. For example, top tracks played in Singapore are P!nk’s Just Give Me A Reason, Katy Perry’s Roar, and Bruno Mars’ When I Was Your Man. Only two per cent of Asian artistes made up Singapore’s top 100 tracks in September.

Interestingly, music fans in Thailand enjoy both Thai and K-pop music, with 50 per cent of Asian acts making up their top 100 tracks in September. Malaysians and Indonesians listen to local pop but also show great interest in rock music.

Both reported 17 per cent and 20 per cent of Asian acts (respectively) in September’s top 100 tracks. However, music fans, no matter which region, are always looking for an easy and quick access to a large catalogue of music as well as discovery to new music.

3. With a number of other music streaming options in Asia now, including Spotify, what would make Deezer more attractive to users?

We pride ourselves in helping emerging artists get heard through the work of our editors.

Unlike other digital music services that rely purely on algorithms to make recommendations, Deezer is unique in that over 20 per cent of our global team are employed to hunt out and recommend the best in new music, actively spreading the word across our over 180 countries and breaking down the barriers of the old physical distribution systems.

This means that we aren’t an unthinking machine – we don’t just collect music and share it, we have local experts making editorial recommendations from their experience of local culture and local character.

We also help artists connect with their fans easily and efficiently. We provide artists and labels with advanced analytics tools – Deezer4Artists – that help them plan campaigns and tours to reach their fans. To complement Deezer4Artists, we have a smart integration with Songkick to surface local gig recommendations.

4. Some musicians, such as Radiohead’s Thom Yorke, have spoken out against the music streaming model, citing the small cut in revenues for them. Do you feel this is fair criticism?

While we’re big fans of Radiohead’s music, we have to disagree with their position.

The fact is, while our model is still in its infancy, what is clear is that streaming is the future. It has already proved instrumental in helping the recovery of the music industry, by providing a legal alternative to piracy for music fans around the world.

The way that artists receive revenue has changed, with a significant proportion coming from concerts and merchandise. Marketing and reaching fans is vital for emerging artists. Deezer is a fantastic platform for emerging artists – as long as they make great music that people want to hear and our editors want to recommend. Artists do get paid when people listen to their music on Deezer.

What’s changed is that with music streaming the artist makes money over the lifetime of the song, rather than just from a one-off purchase. Deezer does not determine the share of that revenue to the artist. Furthermore, streaming is complementing other forms of music consumption, not replacing them.

Many music fans use both our free and our premium service as a music discovery tool. They then still buy CDs, download music, purchase merchandise and attend gigs. Streaming just removes the restrictions of pay-per-play, allowing people to have fun discovering as much new music as they want and wherever they may find themselves.

All of this means that our music service helps emerging artists get a level of exposure unmatched by other music distribution services, beyond simply being a place for people to access back catalogue.

This is so important to us that we’ve made it our company mission; to rebuild the engagement of people with music through active discovery, curation and exclusive content, instigated by our worldwide team of Deezer editors. It is our hope that through Deezer emerging talent can be heard.

5. Do you see music streaming services replacing direct downloads and CDs in future? How do you expect users to consume music in future?

We don’t think that streaming cannibalises music sales, but rather, is the future of the music industry. With streaming, the artist makes money over the lifetime of the song, rather than just from a one off purchase.

There’s been a clear movement from ownership to access – music fans want instant access to their favourite tracks whenever and wherever they are, and on whatever device they’re using – that’s what we provide.

Streaming is still a relatively new means of both promoting artists’ work and remunerating them for it, and the revenue model is very different to a single-price-for-a-single-unit (a CD or download, for example), so it’s understandable that there would have been some initial concerns – there always are with new ways of doing things.

But at least two of the major record companies have stated that, based on their research, there is no evidence that streaming cannibalises sales in other formats – rather, streaming is complementing other forms of music consumption.

Many music fans use both our free and our premium service as a music discovery tool. They then still buy CDs, download music, purchase merchandise and attend gigs.

Streaming just removes the restrictions of pay-per-play, allowing people to have fun discovering as much new music as they want and wherever they may find themselves.

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  • Sami O’Malley

    I think more and more artists will ditch their labels and sign deals with services
    independently thereby collecting more of the revenue. It seems the likely route
    with record companies offering less and less to artists, and a larger DIY
    atmosphere for smaller acts…which is a good thing I think. I t means less
    money for execs who shouldn’t have gotten so much in the first place, and more
    to the actual acts. Deezer sounds interesting, but it’s not in the US. If it
    ever gets here I’d definitely give it a shot! For now I listen to pandora and
    torch music (for when I want video access), and feel decent about not being a
    pirate, even if Thom Yorke isn’t happy.

  • Guess

    CDs are not easy to find as they used to be with more music stores closing. Partly it has to be do with alternatives like streaming, but partly it has to do with both pricing and availability of albums at stores too.

    Distributors of entertainment media such as music, games and video should consider setting up official online stores and sell cd/ dvd/ blu ray directly to the customers, thereby doing away with the middleman and lower cost/ prices for the customer, but for some reason how many have done that?