Look out, ahead. According to a story in Financial Times, Vevo, the music service we mostly know from YouTube, is seeking $300 million to $500 million in funding to create its new subscription channel. That seems like a huge risk even for the best positioned digital music video service.
As FT points out: “The fundraising comes as competition hots up among digital music services. Spotify and Apple Music have become the dominant players in music streaming, but both are increasingly focusing on video. Meanwhile, more free music is streamed on YouTube than on both services.”
That’s the problem. Free works.
I wish I could relocate a quote--from someone--who made the point that music is the thing that media services give away to get you to buy into the bigger package. It’s an add on, the “wait, there’s more” throw in after you’ve already succumbed to buying the ginsu knives.
But music isn’t very unique. It’s all around. It’s handy.
After MTV more or less invented music video as a viable programming genre, cable and broadcast channels loaded up on music videos they could shove into any vacant time slot they had hanging around. It was cheap to produce.
My Comcast super-duper package includes about 40 awful Music Choice channels that serve to just get in the way.
The monotony of AM and FM radio, and the proliferation of Kiss, Hot and Warm and Magic and Ben stations may get you down. But people still listen to a lot of radio and hear a lot of music. It’s still the place most people discover new artists.
The thing is, Vevo is quite good.
It is smartly promoted, exciting and relatively indispensable to pop fans and recording labels--Sony and Universal own a big chunk of it. But when you put a price on that, you’d better have something going on besides the latest videos or exclusive concerts. Consumers judge music formats like Spotify or Apple or Amazon or Pandora or YouTube on a series of three-minute trials, even if the consumer is the one picking the music.
A pay Vevo service would have to be very special to be very successful for very long. And if it goes toward a subscription model, it puts itself up against broad based SVOD services like Netflix, HBO and more. I wonder if it’s a niche with enough video power to make a go of it.
Vevo, under new CEO Erik Huggers, seems eager to get going on to prove a lot of what I’ve said here is dead wrong. It already has fixed its app and Web site, and it’s adding hosts and new programming that will better curate its music. Going forward, it seems Vevo will be trying more original programming.
But pop music seems so transient, its fans seem so splintered and music criticism so absolute that some false moves can be fatal. It’s also a competitive place. Spotify raised $1 billion in funding earlier this year so as Forbes advises, “this is not the time for half-measures.”
The question, though, is whether any time is a time for a subscription service. We’ll find out.