Last week, Dublin-based Muzu TV struck a deal with EMI, followed up this week with the legendary Beggars Group label. Ciaran Bollard, is co-founder and director of business development.
THE music industry was caught napping when the internet came along. Has it finally got its head around the internet, and can it make money?
The problem was there was no business model and people were getting their music for free and illegally. Apple’s iTunes showed it was possible to sell music in a structured way.
The labels are starting to engage and have gotten their heads around the whole idea of digital distribution. The key is that the Muzu model has the competence to give the industry what it wants, and the fact that the model is ad-supported means the industry can begin to engage.
The reason the industry has been standing back is really to figure out how it will exist in and around a parallel revolution in user-generated content. It wants to enter the market in a controlled way and doesn’t want its brands associated with illegal content.
Will Muzu TV compete directly with YouTube?
YouTube got the ball rolling with a mass-market opportunity, but it takes a long time for labels to establish that trust.
We come from a label background and realised what was needed. We focused on getting exclusive deals with artists such as the Ting Tings, The Script and Leona Lewis.
Our model is to pay bands 50/50, whether they are signed or unsigned.
Having already signed Sony BMG and EMI, it is only a matter of time before labels like Universal and Warner come on-board. In this current climate, business is challenging for everyone, but we see exciting things happening in the coming months.
The internet is more than just a PC-based experience, thanks to games consoles and devices such as the iPhone. What integration plans to you have for Muzu?
We recently launched an application on Bebo in Ireland and the UK to allow consumers add content from Muzu to their Bebo profile.
We also struck a deal before Christmas with Microsoft’s Xbox to promote its Lips game across the Xbox and Bebo. This will be part of a longer-term strategy. The web music experience will transcend computers, games consoles and mobile phones. We’re ready for that.
How is Muzu funded and what plans have you to go global?
Muzu has raised €6m in venture capital from Oyster Capital, Enterprise Ireland and a variety of private investors.
At the moment, we are in the middle of another investment round and are able to be able to demonstrate key performance indicators for the business. We will be opening into new territories next year, as well as signing up new major labels.
What is the funding environment like right now for promising Irish technology start-ups?
If you’re an early-stage company there is a limit to what you can raise. It’s a battle between the valuation of the company and raising enough to get you through a particular period of time. There’s a balance you have to strike.
By John Kennedy