MOG Is (Kind Of) For Sale As Subscription Music Consolidation Looms
(UPDATED) Spotify, Deezer, Rhapsody, Rdio, MOG, We7, Slacker, Pandora, Grooveshark and more. Each is a little different, but it's not likely that so many streaming music services can survive. And what happens if Apple and Amazon add streaming music? Rhapsody recently bought Napster, and now comes word the MOG is for sale.
Muisc sunscription service MOG has been contacting a variety of companies to gauge potential interest, according to CNet's Greg Sandoval who sights "numerous sources in the digital-music sector". He also hints that the company may be in financial trouble.
MOG founder David Hyman denies both claims. "We're not actively trying to sell this business," Hyman told Reuters. "The Facebook integration has been fantastic for us, but as we're not yet profitable we're always engaged in conversations with our shareholders about all possible options."
MOG is currently hiring engineers, marketing and sales staff and has not laid off any staffers since 2009, according to Hyman. MOG was founded in 2005 and has raised $33 million from Menlo Ventures and Balderton Capital. The service is estimated to have 500,000 regular users.
Maybe it would be a great business, but just for a much, much smaller group running it.
Of course, the recording houses need their cut, it would be better if these services could somehow reach out to the musicians more, give them a deal to promote the music in return for giving the musicians a fair part of the revenues, based on how much it’s listened to or something. Maybe there’s enough $ available for just a distributor and the musician, but not with everyone else.
Consolidation is a must for this industry. All companies essentially have the same equal distribution and roughly the same product idea. (Is Pandora’s “Today’s Country” channel any different or appreciably better than other competitors?) As far as the record companies are concerned, the more participants the better. However, once the streaming music sector shrinks to 2-3 major players, that newfound revenue stream they’ve been hoping for will evaporate considerably and no record company is counting on that.